Stephanie Armour
USA Today

Previously owned home sales jumped in the Northeast, Midwest and South. Only the West saw a decline. By Bill Sikes, AP

Existing home sales jumped in April as buyers rushed to take advantage of home buyers tax credits before they expired last month.

Sales increased 7.6% to a seasonally adjusted annual rate of 5.77 million units in April from an upwardly revised 5.36 million in March, according to a report Monday from the National Association of Realtors (NAR). That’s 22.8% above the 4.70 million-unit pace in April 2009.

Economists attribute much of April’s boost to buyers’ scramble to buy homes before the deadline for the tax credit, which provided up to $6,500 for move-up buyers and up to $8,000 for first-time buyers. Sales are expected to weaken after June.

“I thought the market would get a nice impact (from the tax credit),” says Lawrence Yun, chief economist with NAR. “But (growing) inventory is raising a little concern. It could put downward pressure on prices. Through June, sales will be elevated, and after June, measurably lower.”

The national median existing-home price was $173,100 in April, up 4% from April 2009. Distressed homes, which include those sold at foreclosure or short sales, accounted for 33% of sales last month. Distressed properties tend to bring down overall home prices.

Total housing inventory at the end of April rose 11.5% to 4.04 million existing homes available for sale, which represents an 8.4-month supply at the current sales pace, up from an 8.1-month supply in March.

The recent rise in home sales is attributed to other factors along with the tax credit. Home prices in general have fallen so low that they’re luring more buyers.

Mortgage rates also have hovered around a low 5%, making it an attractive time to purchase a home, says Stuart Hoffman, chief economist at PNC Financial Services.

“Everything sort of just lined up,” Hoffman says. “You had a very active market. (But) the upward momentum won’t be sustained at this pace.”

Joel Naroff, at Naroff Economic Advisors, says he expects sales will fall fairly sharply in the next couple of months.

“We are going to get a couple of months of softer sales,” Naroff says. “But there are enough factors out there to provide growing sales throughout the year. I also think prices are going to go up.”

Copyright 2010 USA TODAY

USA Today

Economists don’t expect home sales to remain as strong now that the government incentive program has ended. By Amy Sancetta, AP

NEW YORK (AP) — The Standard & Poor’s/Case-Shiller 20-city home price index released Tuesday posted a 0.5% drop from February.

Prices in 13 of the 20 cities tracked by the index fell month over month. Only six metro areas recorded price gains. One, Boston, came in flat.

Detroit and Chicago saw the largest monthly declines at 4.1% and 2.3%, respectively. Cleveland enjoyed the biggest gain at 1.8%.

The numbers are especially disturbing because they show that improved sales due to the tax credits didn’t translate into higher prices, said David Blitzer, chairman of the S&P index committee.

“When you look at recent trends, there are signs of renewed weakening in home prices,” he said in a statement.

In a healthier economy, extraordinarily low mortgage rates would pump up demand for homes. But economists say the job market is too weak and credit is too tight.

Sales of previously occupied homes rose 7.6% in April, the National Association of Realtors said Monday. But the sales were boosted by government incentives that have now expired. Economist don’t expect the improvements to last.

New buyers were offered a credit worth up to $8,000, while current owners who bought and moved into another home could get one for up to $6,500. To receive them, buyers had to have a signed offer by April 30 and must close by the end of June.

The declining home prices are discouraging for American homeowners who have seen the value of their largest asset deteriorate significantly over the last three years. If home prices dip again, consumers may curb their spending and threaten the nascent economic recovery.

And for homeowners struggling to pay their mortgages, falling home prices makes it even harder to refinance into an affordable home loan. Mortgage delinquencies were at a record high in the first quarter.

Nationally, prices have climbed nearly 3% from their April 2009 bottom. But they remain nearly 31% below their July 2006 peak.

In the first quarter of 2010, U.S. home prices fell 3.2% compared with the fourth quarter.

Copyright 2010 The Associated Press. All rights reserved.

Hire a professional inspector to give house the once-over

Province

House hunters ready to buy are advised to hire a professional inspector because, depending on what they find, it may impact the purchase price and affect your homeowners’ insurance premiums. — FOTOLIA

The rush is on to buy a home before the mortgage rates go up too high and, in B.C. and Ontario, before the harmonized sales tax is introduced on July 1, pushing prices higher.

But homebuyers are well-advised not to be too hasty when it comes to signing their names to the deed of their new homes.

“A house doesn’t come with a money-back guarantee, which is why it’s so important to be aware of potential issues before you buy,” says Henry Blumenthal, vice-president and chief underwriter, TD Insurance.

“New homeowners need to know what they’re buying and ensure they can maintain and protect their most valuable asset, because once the ‘sold’ sign goes up, the buck stops with them.”

By consulting the experts before you buy you can avoid being hit with unexpected expenses afterward — such as needing a new roof or furnace.

Even the best-looking home can have problems under the surface that will invalidate your home insurance.

TD Insurance advises that new homebuyers hire a professional home inspector to give the place the once-over before any cash changes hands.

The inspector’s job is to go over the home’s structure and major systems — roof, exterior, electrical, heating, cooling and plumbing — with a fine-tooth comb to identify current or future problems.

Insurers can use that report to identify areas that could decrease or increase premiums — or even make you ineligible for home insurance.

Water damage is one of the most common problems — currently, water damage is responsible for about half the home-insurance claims that TD Insurance pays out.

When looking at the building inspector’s report, an insurer will want to know, among other things, whether your house is susceptible to flooding, how often it occurs and what damage it causes, and will adjust your premiums accordingly.

Outdated plumbing and electrical systems can also affect your premiums and eligibility for insurance, as well as outdated heating systems; liability exposure (for example, an unfenced pool); previous renovations; presence of smoke detectors; and alarm systems.

“The inspection identifies what repairs need to be made and at what cost,” adds Bob Dunlop, president of Carson Dunlop, a leading home inspection company.

“Depending on your financial situation, what comes out of our report could have an impact on your purchase decision. It could even give you some bargaining power with the seller.”

© Copyright (c) The Province

Claudia Kwan
Province

The huge windows offer a stunning view over the water. The CHIL Design Group created a show suite with the theme ‘Global Living.’ which has two bedrooms and a flex space and measures more than 1,400 square feet. Photograph by: Steve Bosch, PNG, The Province

The ‘Asian influence’ theme is evident in the Millennium Water show home designed by Ledingham Design Consultants. Photograph by: Steve Bosch, PNG, The Province

William Switzer and Associates created a ‘Perfect Parisian’ theme for their show home. Photograph by: Steve Bosch, PNG, The Province

The show suite decorated by Alda Pereira Design has a ‘Gold, Gold, Gold’ theme. Photograph by: Steve Bosch, PNG, The Province

Kodu Design created the design for the show suite with a ‘Canadian Olympian’ theme. Photograph by: Jenelle Schneider, PNG, The Province

The show suite by Mitchell Freedland Design has a ‘Sophisticated Modern’ theme. It is a 2,997-square-foot, three-bedroom home at Millennium Water. Photograph by: Ian Lindsay, PNG, The Province

The design in the ‘Global Living’ show suite was created by CHIL Design Group. Photograph by: Steve Bosch, PNG, The Province

The Cross Decor and Design created a show suite with a ‘French Provencal’ theme. Photograph by: Steve Bosch, PNG, The Province

‘Green and Sustainable’ is the theme of the show suite outfitted by BYU Design. It’s elegant with clean lines. Photograph by: Jenelle Schneider, PNG, The Province

The show suite designed by Inform Interiors takes a ‘100 Mile House’ theme. The suite, measuring more than 1,100 square feet, has two bedrooms and a flex space. Photograph by: Jenelle Schneider, PNG, The Province

Nine of Vancouver’s top interior designers are opening the doors to their work at the Millennium Water development, site of the one-time Olympic Athletes’ Village on the southeast shore of False Creek.

The designers’ “Avenues of the World” show homes are on view to the public as part of a marketing campaign to sell many of the condominiums.

Those who visit the homes — each has its own theme — will be given a “passport” at the Millennium Water sales office. By visiting at least eight of the nine show suites and collecting a stamp from each, they will become eligible to win a grand prize worth $20,000. That prize consists of a $5,000 gift certificate to Inform Interiors, $5,000 for the Cross Decor and Design, $5,000 for the services of William Switzer, a maker of reproduction antique furniture, and $5,000 in consultation services for any of the other interior designers involved in creating the show suites.

Ten second prizewinners will each receive an Electra bicycle with an estimated value of $700.

The nine interior designers include Alda Pereira Design, BYU Design, Inform Interiors, Kodu Design, Ledingham Design Consultants, The Cross Decor and Design, Mitchell Freedland, William Switzer and Associates and CHIL Design Group.

Avenues of the World is open to the public from noon to 5 p.m. every day but Friday.

The contest opened, along with the show suites, on May 15. Admission is free.

For more information, call the Millennium Water presentation centre at 603-733-2010.

© Copyright (c) The Province

Derrick Penner
Sun

April saw a slight dip within the rise of Metro Vancouver housing prices — another sign the market is easing into a balanced state.

The Conference Board of Canada noted that Metro Vancouver’s average home price dipped 2.6 per cent to $662,348 in April from March, though it remains almost 20 per cent higher than the same month a year ago.

Conference board analyst Robin Wiebe said that with a dramatic rise in Metro Vancouver’s new listings, it isn’t a surprise to see prices adjust as buyers take their time with offers.

Wiebe’s report observed new-listing activity in Metro Vancouver in April that was almost 63 per cent higher than a year ago, with sales up just 17 per cent from the same month a year ago.

“[The data] says that buyers might be getting a little cautious,” Wiebe said in an interview. “But just a little.”

And Wiebe cautioned that “one month [of data] is not a trend.”

University of B.C. Prof. Tsur Somerville said whether Metro Vancouver prices dip or stay stable from one month to the next essentially tells the same tale.

“Instead of looking at a market where prices rose 15 per cent in a year, we’re looking at a market where large price increases are not what anybody expected,” Somerville, director of the centre for urban economics and real estate in the Sauder School of Business, said in an interview.

He expects prices will be “steady for a while,” while “getting price declines would be somewhat of a challenge in absence of something going wrong [in the economy.]”

Somerville added that the conference board’s report, which repurposes the monthly data compiled by Canada’s major real estate boards, is further evidence that the market is slowing and is in keeping with the forecasts of major agencies and banks.

The psychology of the market for buyers now, Somerville said, is “if we don’t buy this month, we’ll be okay next month,” which is different from the frenzy at the end of 2009.

Metro Vancouver was one of 16 markets that saw prices slip back from the previous month among the 28 markets the conference board tracks in the index. Victoria also saw a dip in prices for the average, down 1.4 per cent to $515,499, as did the Fraser Valley, which was down 0.5 per cent to $451,480. Calgary saw a 1.6-percent dip to $392,646 and Toronto saw a 3.3-per-cent drop to $425,011.

© Copyright (c) The Vancouver Sun

Shopping around for better rate brings hurdles

Garry Marr
Sun

A headlock would be the wrestling term to describe the hold Canadian banks will have on some consumers because of new, stricter mortgage rules.

We are already seeing the impact of the changes that came into effect on April 19, but were put in place well in advance by Canadian financial institutions. Consumers are increasingly selecting fixed-rate mortgages of five years or more because it’s easier to qualify for them.

on mortgages for terms of four years or less, including variable-rate mortgages, consumers must be able to pay based on the five-year fixed posted rate, which is now 6.1%. Go longer and you can use the rate on your contract, as low as 4.6%. No more than 32% of your gross income can cover principal and interest, property taxes and heat.

peter Vukanovich, president of Genworth Financial Canada, the largest private provider of mortgage-default insurance, says only 5% of new high-ratio mortgages are going variable versus 15% just six months ago.

But there is another wrinkle to the new rules. Anybody shopping around for a better rate has to requalify based on their current credit situation. stay with the same bank and there’s no check.

“it’s definitely a headlock and not a loophole because a loophole you can get out of,” says Vince Gaetano, a mortgage broker with Monster Mortgage.

there is a large percentage of Canadians who get a renewal notice from their bank and just sign on the dotted line. the Canadian Association of Accredited Mortgage professional has found only 22% of Canadians switch banks at renewal time. A significant portion of the remaining 78% are sheep being led around by their financial institution.

those looking for some choice may find what was good enough to get into the market a month ago may not meet the test today.

Consider that as recently as two years ago, consumers were able to buy a house with no money down and a 40 -year amortization schedule. if that consumer was making regular monthly payments, they would have paid down only 4.7% of their principal after five years. today, that customer would still be high ratio and subject to requalifying if they switched banks.

“it’s not all of them, but a majority of first-time buyers with just 5% down or less won’t be able to qualify if they go to another bank,” Mr. Gaetano says. Many of those buyers were qualifying based on the three-year rate — about 200 basis points lower than the current qualification rate.

if house prices went down, something many in the real estate community have suggested could happen, that would be an even bigger blow for consumers. it would mean an even larger percentage of homeowners would still be considered high ratio upon renewal because they wouldn’t meet the test of having 20% equity in their home.

Marcel Beaudry, vice-president of iNG direct, says there is no question the new rules will have an impact on consumers looking to switch banks, but noted anyone who had a 40-year amortization and changed institutions also had to requalify and there hasn’t been a huge impact.

“there will be a segment of the population tied down by the new rules to their bank,” Mr. Beaudry says. that’s a position nobody should be in.

© Copyright (c) The Vancouver Sun

Claudia Kwan
Sun

CHIL Design Group CHIL Design Group has worked on some high-profi le projects in Vancouver, including the opulent Shangri-La and Fairmont Pacifi c Rim hotels. Now it’s setting its sights on enticing buyers to sign on the dotted line with its interplay of texture and use of natural light at Millennium Water, where its show suite at 702 — 1633 Ontario Street has a “ Global Living” theme. The building is a product of Merrick Architecture Borowski Lintott Sakumoto Fligg Ltd. The dark blue walls and brown tones evoke the water and earth outside, with the stunning views highlighted by low-slung glass furniture. Nature has a strong, but subtle presence with fl ower pillows on a bed and sunshine yellow accents. The décor encompasses both high end and bargain brands.

Alda Pereira has put her distinctive design touch on many of the condo buildings in Vancouver, incorporating natural materials and light whenever possible. She’s so beloved by developers, there’s even a building named after her at 1275 Hamilton St. The theme of the Alda Pereira show suite, located at 502 — 118 Athletes Way, is “ Gold, Gold, Gold.” The colour makes a splash as gold foil filling the Lucite coffee table, and metallic wallpaper on the walls of the master bedroom, right down to the shiny cutlery on the dining table. Playful textures in the suite include cork stools, a brocade sofa embroidered with birds, and bathroom towels monogrammed with ADP in gold. This suite is located in a building designed by the Merrick Architecture group. PHOTOS: STEVE BOSCH/ PNG

BYU Design stands for Bob’s Your Uncle, something Ada Bonini and her business partner Cheryl Broadhead thought would accurately convey their sure-footed approach to the business of design. The team works on both residential and commercial spaces around the Lower Mainland. The theme of the BYU suite at Millennium Water, located at 711-1633 Ontario St., is “Green and Sustainable.” In spite of the name, green is not the predominant colour, but is expressed in the materials used. Aluminum is prominent throughout the décor, as it’s recyclable, and wood elements are Forest Stewardship Council-certified. Cardboard makes an appearance in Frank Gehry-designed living room stools. This suite is also in a building designed by the Merrick Architecture firm. JENELLE SCHNEIDER/ PNG

The Cross Decor & Design. Lead disigner Peter Wilds of The Cross Decor and Design clearly has no problem having fun with design. Fur and feathers enter the mix, too, at the posh Yaletown shop, which offers everything from furniture and lighting to jewelry and baby onesies. The Cross took the theme “Frech Provencal” for its show suite at 404-12 Athletes Way in a building designed by the Merrick architectural group. A den has cheeky wallpaper designed to look like books on shelves, while the guest bedroom has horizontally painter stripes of geey and white. A huge sparkling chandelier dominates the living space, over the dining table and chairs with a classic silhouette, modernized by crisp black and white striped fabric. No shabby chic here; cream-painted wood furniture and a wall mirror are as clean as the come. STEVE BOSCH PNG

Owner Nancy Bendtsen is known for stocking cleanly contemporary, modern furniture and accessories in her Gastown storefront. Her theme in the two-bedroom Millennium Water show suite located at 701-1633 Ontario St. is “ 100 Mile House,” with most of the interior design elements being sourced from within that geographical radius. Solus Concrete built an outdoor fire pit to warm up a cool spring evening, and Prince George designer Shawn Place crafted a solid oak rocking chair. Jonathan Cruz photos are featured throughout the suite, and the lighting comes from local designers Omer Arbel of Bocci and Molo Design. This suite is in a Merrick Architecture-designed building.

Principal Merike Lainevool of Kodu Design puts a ton of thought into every aspect of her designs. At Millennium Water, she’s clearly having fun with the show suite at 709 – 1633 Ontario Street, which has the theme “Canadian Olympian.” The room is white with bright splashes or red. An overhead projector beams words of inspiration. A lucky Canadian dollar is tucked underneath the glass dining tabletop, bull’s-eye targets are hung in the bathroom and trophy cups line an entire wall in one bedroom. Go, Canada, Go. The Merrick Architecture group was responsible for the building design. PHOTS: JENELLE SCHNEIDER PNG

Robert Ledingham of Ledingham Design has been on the Vancouver scene for decades. the Ledingham show suite, located at 304 – 151 Athletes Way, has a theme called “Asian Influence.” The show suite is housed in a building designed by Arthur Erickson Architectural Corp., with Nick Milkovich Architect and Lawrence Doyle Architects. Dark wood furniture has clean straight lines, with a nod to traditional Asian design in the circular handles. Hits of red and orange and burgundy pop against creams and tans, while the built in white fabric banquette in the dining room will no doubt be a popular lounging spot. PHOTOS: STEVE BOSCH PNG

The William Switzer company specializes in reproductions of antique furniture in a range or eras and styles. The theme of the show home located at 505 – 1616 Columbia in a Merrick Architecture group building, is “Perfect Parisian.” PHOTOS BY STEVE BOSCH/ PNG

Meet the designers behind Millennium Water’s Avenues of the World — and their spectacular living spaces As part of an extensive marketing push for the homes at the Millennium Water development — the former Olympic Athletes’ Village in Southeast False Creek — members of the public are being invited to tour nine show suites decorated by top Vancouver interior designers.

Perhaps the word “enticed” is more accurate, since people are being advised to pick up a “passport” at the sales office for the campaign, dubbed “ Avenues of the World.” By visiting at least eight of the nine show suites and collecting a stamp from each documenting the visit, they will become eligible to win a $20,000 grand prize.

That prize is made up of four parts: a $5,000 gift certificate to Inform Interiors in Gastown; $5,000 for the Cross Décor and Design in Yaletown; $5,000 for the services of William Switzer, a maker of reproduction antique furniture; and $5,000 in consultation services for any of the other interior designers involved in creating the show suites. Ten second-prize winners will each receive an Electra bicycle with an estimated value of $ 700.

The nine show suites represent the diversity of what’s on offer at the 1,108-unit Millennium Water community.

“We’ve got a very simple, sustainable design, right up to hyper-luxury on the water,” noted marketer Bob Rennie. “And then, in between, we’re having fun with a suite that’s done all in gold by Alda Pereira.”

Avenues of the World is open noon to 5 p. m. every day but Friday. For information, call 603-733-2010.

© Copyright (c) The Vancouver Sun

Global economy, effect of HST prompt buyers to bide their time

Derrick Penner
Sun

British Columbia real estate sales dropped by more than one quarter in the three months of 2010 from the last quarter of 2009 in both the number of transactions and value, Landcor Data Corp. reported this week.

The real estate consultants counted 23,195 sales cleared through B.C.’s Land Title office during the first quarter, which is substantially higher than the same period a year ago, but almost 27 per cent off the 31,623 sales recorded during the last three months of 2009.

The total value of those sales almost tipped $10.7 billion, nearly double the number seen during the first quarter of 2009, but again was almost 26 per cent off the $14.4 billion in deals done at the end of 2009.

The results quantify the trend economists such as Cameron Muir, chief economist for the B.C. Real Estate Association, have observed since January.

Landcor’s numbers “certainly support the data we’ve been looking at that shows that obviously the pace of sales have slowed since the last quarter of 2009,” Muir said in an interview.

Last year’s “fourth-quarter peak is unlikely to reoccur in 2010.”

Landcor president Rudy Nielsen said B.C. home sales are typically slow at the beginning of the year, but the first-quarter slowed more than usual compared with the last decade. This is in part, he believes, because of the Olympics.

Nielsen added that consumer uncertainty over a host of issues, ranging from the global economic situation to unknown effects of the harmonized sales tax, have consumers sitting on their wallets.

“I think people are sitting back and seeing where we’re going,” Nielsen said in an interview.

Muir said he expects higher prices and higher mortgage rates will also squeeze demand.

In it’s report, Landcor noted that single-detached houses fared better than condominium and townhouse properties, posting “small yet respectable” gains in average value.

The average house price in B.C., based on all sales recorded through the provincial Land Titles Office, was $487,357 during the first three months of this year, some 2.5 per cent higher than the fourth-quarter of 2009.

Among regions, Landcor found that the Fraser Valley saw the steepest decline in first-quarter sales compared with the end of 2009, and was the region that struggled the most with pricing.

The Valley saw 2,661 sales during the first three months of 2010, down almost 33 per cent from the end of 2009. And while the average house price was up almost two per cent in the first quarter to $445,221, the average condo price was down almost nine per cent to $189,775 compared with the fourth quarter last year.

In Metro Vancouver, first-quarter sales of 11,468 units were down almost 26 per cent compared the last three months of 2009.

The average house price, according to Landcor, was up 1.6 per cent to $721,255 compared with the fourth quarter.

© Copyright (c) The Vancouver Sun