Joannah Connolly
Western Investor

A decline in Toronto’s rental prices may have put Vancouver back on top as Canada’s priciest city for one-bedroom rents, but median prices have declined in all the top five most expensive rental cities.

A monthly analysis of prices by rental website Padmapper found one-bedroom rents in Vancouver proper holding firm at $2,000 – the same as two months ago and very slightly more than last month. But two-bedroom units in the city fell 1.6 per cent – although that only reduces the median rent to $3,150.

Toronto’s larger decreases in rent prices dropped the city into second place in the price rankings, with a 4.4 per cent slide in one bedroom prices to a median of $1,970, and two bedrooms dropping 2 per cent to $2,500.

Burnaby retained its third place among Canada’s most expensive rental cities, but also saw price declines, with one bedrooms dropping 1.4 per cent to $1,420 and two bedrooms falling 4.2 per cent to $2,040.

Montréal, Québec and Barrie, Ontario remained the fourth and fifth most expensive cities for rental prices, and both cities saw declines in one- and two-bedroom rents.

Vancouver was the only one of the top five priciest cities not to see a decrease in one-bedroom rental prices.

Check out Padmapper’s report infographic with the remaining top 10 most-expensive cities for one-bedroom rents, above.

Copyright © 2018 Western Investor

Dirk Meissner
REP

British Columbia is trying to more directly target urban areas with changes it announced Monday to a proposed tax on property speculation after some municipalities demanded exemptions and the Opposition accused the New Democrats of grabbing family assets.

Finance Minister Carol James is also adjusting the tax rate after first announcing details of the levy in the budget last month.

The changes would create a number of exemptions and shift which areas of the province would be covered by the tax.

Under the details announced by James, the tax would apply to properties in Metro Vancouver, Kelowna, West Kelowna, Nanaimo-Lantzville, Abbotsford, Chilliwack, Mission and the Capital Regional District around Victoria on southern Vancouver Island, excluding the Gulf Islands and Juan de Fuca.

The speculation tax is intended to improve housing affordability in areas where the need is most acute, while exempting rural cabins and vacation homes, James said.

“We have a responsibility as a government to ensure that hard working British Columbians can afford to call this province home,” she added.

The changes are due to be introduced in legislation this fall.

“Over 99 per cent of British Columbians will not pay the tax,” said James. “Only those who hold multiple properties and leave them empty in our province’s major cities will be asked to contribute.”

In 2018, the rate for all properties subject to the tax would be set at 0.5 per cent of a property’s assessed value, regardless of whether the owner is foreign, Canadian or from B.C.

Starting in 2019, the tax rate would be set at two per cent for foreign investors and extended family members.

For Canadian citizens and permanent residents who do not live in British Columbia, the tax rate would rise to one per cent of a property’s assessed value next year.

B.C. residents with second properties are also eligible for tax credits valued up to $400,000, said James. The tax credit is meant to offset the tax of $2,000 on a property valued under $400,000.

James said people who rent out their second property for at least six months of the year will not have to pay the speculation tax.

“The speculation tax focuses on people who are treating our housing market like a stock market,” she said.

James said the government estimates the tax will generate about $200 million in revenue next year.

Liberal Leader Andrew Wilkinson said the minority NDP government appears to be taking a trial and error approach to tax policy, which does not inspire confidence.

“They seem to think they can attack speculation with a tax that is not about speculation,” he said.

Green Leader Andrew Weaver said the changes “go a long way” to dealing with his party’s concerns about the tax.

“In particular, the government’s policy must target speculation and empty homes in our urban centres without undue adverse effects on rural areas and on British Columbians who aren’t speculators,” he said in a news release.

“They make it much more targeted and limit the effects on British Columbians with vacation homes.”

Copyright © 2018 Key Media Pty Ltd

Steve Randall
Canadian Real Estate Wealth

The new speculation tax announced in the recent British Columbia budget will have limited impact on residents the government says.

The province’s Minister of Finance Carole James said Monday that more than 99% of British Columbians will be exempted from the speculation tax.

“Our government wants to make sure people who live and work here are able to find and afford a good home in their community,” she said. “For too long, this housing crisis was allowed to escalate, and it has hurt working families, renters, students, seniors and others around the province. With this new tax, we’re targeting speculation in the housing market and freeing up vacant housing to be homes for British Columbians.”

James said that the tax is designed to target those who use the BC housing market “like a stock market” and said that those in smaller communities, or who own cottages at the lake or islands will not pay.

“We are going after speculators who are clearly taking advantage of the market, leaving homes vacant and driving up prices,” she warned.

Key Facts:

On implementation, the speculation tax will apply to:

• Metro Vancouver
• The Capital Regional District (excluding the Gulf Islands and Juan de Fuca)
• Kelowna and West Kelowna
• Nanaimo-Lantzville
• Abbotsford, Chilliwack and Mission

In 2018, the tax rate for all properties subject to the tax is 0.5% of the property value.

In 2019 and subsequent years, the tax rates will be as follows:

• 2% for foreign investors and satellite families;
• 1% for Canadian citizens and permanent residents who do not live in British Columbia; and
• 0.5% for British Columbians who are Canadian citizens or permanent residents (and not members of a satellite family).

Exemptions include primary residences, qualifying long-term rentals, and tax credits for second homes valued up to $400,000.

Victoria Residential Builders Association says that the tweaking of the details since the tax was announced still doesn’t address the province’s key housing market issue, low supply.

It says that the government has a “fundamentally flawed policy undermining our economy and jobs.”

“Encouraging supply creates affordability and jobs, while oppressive taxes like the Speculation Tax do the opposite. The problem is not the market, it’s govt.,” the association says.

Copyright © 2018 Key Media Pty Ltd

Sean Eckford
Western Investor

A BC Supreme Court justice has ruled that development permits issued for the George Hotel and Residences project in Gibsons were issued properly and the developer should be allowed to act on them.

The Gibsons Alliance of Business and Community (GABC) filed court actions last year, after Gibsons council approved development permits in August. 

One of the approvals was based on a 2017 letter from the Ministry of the Environment indicating support for the developer’s plans to remediate the site after decades of industrial activity.

GABC argued the Town was required to do its own evaluation under the Environmental Management Act (EMA).

The Town responded that it acted properly because it opted out of parts of the provincial contaminated sites regulations in the 1990s, making the province the final authority.

Justice Robin Baird of Nanaimo handed down a 10-page decision (available here) March 21, after hearing the case in mid-January.

Baird found the Town was correct when it asserted it has no role in approving the site remediation plan because it opted out in the ’90s.

“The developer has committed to complete site remediation to EMA standards up to a certificate of compliance. The process of achieving this objective is well in hand under active ministry supervision. The developer was entitled to the permits and the Town … had no lawful basis to refuse them.”

Developer Klaus Fuerniss told Coast Reporter in a statement Wednesday that he was “very pleased” and “not surprised” by the ruling.

GABC did not respond to requests for comments before Coast Reporter’s deadline.

The Town and George Gibsons Development Ltd., the company set up by Fuerniss for the project, also argued in court that the challenges were an “abuse of process” because the petitioners’ claims in the Supreme Court case opposed their claims in an appeal to the Environmental Appeal Board (EAB).

In his statement, Fuerniss said he felt the ruling was also a recognition of the potential abuse of process. 

Baird wrote the developer has been put “to the time and expense of responding to contradictory arguments advanced simultaneously in two different forums.”

Fuerniss said the costs for the project have now gone beyond the norm for similar-sized projects.

“This project should have started already. People should already be employed in well-paying jobs that support them and their families,” he said. “With this ruling, it is good to have another hurdle out of the way so we can prepare for the start of construction.”

Acting mayor Silas White said from the Town’s perspective the ruling speaks for itself and upholds the validity of the process for issuing the permits. “It was pretty black and white and supports the Town’s handling of this matter,” he said.

This week’s ruling does not affect the case the GABC has taken to the EAB.

The EAB will conduct a hearing in Sechelt in late October on whether the letter of support for the remediation plan from ministry officials is valid.

Late last year the EAB handed down a pair of decisions.

One confirmed it has jurisdiction to hear the appeal because the letter can be considered an appealable decision under the Environmental Management Act, despite arguments from the ministry and the developer that it was not appealable.

The other decision denied GABC’s application for a stay against the developer acting on the letter.

White said the Town will not be involved in the EAB hearing.

Copyright © 2018 Western Investor

Neil Sharma
REP

Given how high the stakes of mansion sales are, one would think every pertinent modicum of information would be disclosed. Turns out the owner of a Shaughnessy mansion in Vancouver forgot to tell a buyers about a gangland murder on the premises that occurred no fewer than 22 months earlier.

The victim was the owner’s son-in-law.

A judge ordered the owner Mei Zheng Wang return Feng Yun Shao’s $300,000 deposit on the mansion, located at 3883 Cartier Street, which the latter initially agreed to buy for $6.138mln. However, upon hearing about the unsolved murder, Shao began fearing for her family’s safety and backed out of the deal.

Raymond Huang, Wang’s son-in-law and a prominent member of Big Circle Boys, an international gang involved with drug trafficking, was assassinated by gunfire outside the premises in November 7, 2007. By September 2009, Wang had entered a purchase agreement with Shao.

The sprawling 9,000 square foot mansion featured six bathrooms, 10 bathrooms, a wine cellar and extensive gardens, and was eventually sold to another buyer for $5.5mln.

Shao, a mother of three, backed out of the agreement and was sued by Wang for breach of contract, arguing she was entitled to keep the deposit, and wanted $338,000 in additional damages. However, Shao filed a counterclaim in which she accused Wang of failing to disclose her son-in-law’s murder.

During cross-examination, Winnie Yuan, Wang’s daughter who was married to Huang, was evasive about the nature of her late husband’s business dealings. According to the Vancouver Sun, she was arrested by Hong Kong police in 2009 and jailed for money-laundering.

Shao argued during litigation that Huang’s violent death constituted a “latent defect,” and that the house was presented a danger to its occupants. While the judge rejected those arguments, the ruling ultimately placed blame on Wang for fraudulently misrepresenting the reasons for the sale—Wang initially claimed her daughter was changing schools.

“Ms. Yuan knew, as she acknowledged at trial, that her daughter would not have changed schools but for the murder of Raymond (Huang), ” the judge was quoted as saying in the Vancouver Sun.

“Although Ms. Yuan disclosed the murder of her husband to (the realtors), and sought advice concerning the circumstances in which she would be required to disclose Mr. Huang’s death, she and the plaintiff had no intention of disclosing the death unless they were obliged to do so.”

The judge also awarded Shao $4,000 in damages for legal fees.

Copyright © 2018 Key Media Pty Ltd

At Fraser Commons, Serracan brings it all close to home

Simon Briault
The Vancouver Sun

Fraser Commons

Project location: 725  Southeast Marine Drive

Project size: 363 one- to three-bedroom homes ranging in size from 438 to 1,059 square feet, with prices starting from $439,900 for a one-bedroom, $709,900 for a two-bedroom and $991,900 for a three-bedroom

Developer: Serracan Properties

Architect: Francl Architecture

Interior designer: Cristina Oberti Interior Design

Sales centre: 725 Southeast Marine Drive

Sales centre hours: noon — 5 p.m., daily

Telephone: 778-737-3178

Website: frasercommons.com

Serracan Properties founder Gino Nonni has been in the real estate business for 35 years and his company’s work spans nearly every type, whether mixed-use, commercial or residential. Serracan’s latest venture is Fraser Commons, a residential development in south Vancouver, the first under the company’s new Serracan City Living brand.

“The single most important thing we’ve done over the years has been to really listen to the community and our customers about the things that are important to them,” Nonni said. “Real estate plays a big part in determining the quality of people’s lives so taking the time to build strong relationships with communities is essential.”

For Fraser Commons, Nonni said the company took a neighbourhood consultation approach, which strongly influenced the plan and inclusive nature of the development itself. This is most evident in the half-acre park and a daycare at the centre of Fraser Commons, developed in close consultation with the neighbourhood and the City of Vancouver. The development also includes a fitness centre and a private, open-air rooftop terrace on the sixth floor.

“Serracan is a family-owned, Vancouver company,” Nonni said. “With Fraser Commons, we were very careful about the people we chose to work with. Whether it was our marketing partners at Rennie, the architects at Francl Architecture or Cristina Oberti Interior Design, we knew that they shared our vision for the project and for the neighbourhood.”

Fraser Commons will comprise four buildings of between five and 21 storeys. There will be a total of 363 homes of one to three bedrooms, ranging in size between 438 and 1,059 square feet. Prices start at $439,900 for a one-bedroom unit, $709,900 for a two-bedroom residences and $991,900 for a three- bedroom home. There’s plenty of variety on offer with no fewer than 28 floor plans to choose from.

“There will be amenities right there on site in the form of shops and services on the ground floor so residents can go on down and grab a coffee, visit the bank or go to the doctor’s office,” Nonni said. “Serracan will maintain control over the types of businesses we’ll have there because we recognize that it adds value to the homes when the manager and owner of the building can vouch for the quality of the businesses and amenities in the development.”

Fraser Commons sits at the intersection of Fraser Street and Southeast Marine Drive. It’s within striking distance of the Canada Line, which connects directly to downtown Vancouver to the north or Richmond and the airport to the south. The amenities at Marine Gateway, the Sunset Community Centre, Langara College, three local parks, a number of neighbourhood schools, Oakridge Centre shopping mall and Fraserview Golf Course are all easily accessible.

“I’m also personally very pleased that we’ll have a state-of-the-art daycare on site,” Nonni added. “There’s a big shortage of daycare spots in Vancouver and these days many parents both work so we’re definitely meeting a need. It makes a big difference to families when you have a daycare that’s close to home.”

The homes at Fraser Commons are air conditioned, with wood laminate flooring throughout and oversized windows offering views of the city and the Fraser River. Every home comes with a front-loading Whirlpool washer and dryer.

The kitchens feature imported European Armony cabinetry from Inform Kitchens, with lacquer and laminate finishes and integrated under-cabinet lighting. There are quartz countertops and hexagonal porcelain tile backsplashes. The appliance packages are by Bosch and include 30-inch built-in custom panel bottom-freezer refrigerators, 24-inch integrated dishwashers, 30-inch stainless steel wall ovens, 30-inch stainless steel gas cooktops and 30-inch stainless steel pull-out hood fans. (The one-bedroom homes have 24-inch appliances).

Bathrooms and ensuites have large-format porcelain tiles along walls and floors. There are floating bathroom vanities from Armony cabinetry with quartz countertops and rectangular porcelain undermount sinks. The Swiss-designed medicine cabinets are from Sidler International and there are built-in shower niches. The two- and three-bedroom homes have white soaker bathtubs. There are frameless, tempered-glass shower enclosures and polished chrome Grohe shower fixtures.

Nonni said that much of the interest in the homes has come from the neighbourhood immediately surrounding the Fraser Commons site and that this is, in part, because of the extensive connections that Serracan built with the local community.

“My philosophy and history in business has been to collaborate with all stakeholders, including residential communities, in my approach to development and to transforming both commercial and residential neighborhoods,” Nonni said. “The demand for Fraser Commons has been excellent and, more importantly, the feedback from the community based on our inclusive process has been very positive.”

The presentation centre for Fraser Commons includes a one-bedroom and a two-bedroom show suite and is open from noon to 5 p.m. every day.

The developers expect Fraser Commons to be completed by the winter of 2021.

© 2018 Postmedia Network Inc.

Cooling market could sink recent buyers

Joel Schlesinger
The Vancouver Sun

Buying a first home together is a milestone for many young couples.

But for Ines Min and her husband, achieving this life landmark felt more like a feat of herculean financial effort.

Like so many other buyers looking to purchase property in the Lower Mainland, they faced the challenge of buying a home in a red-hot market in which prices for even a modest apartment-style condominium exceed $680,000.

Despite the cost, the couple were undaunted, figuring it was now or never.

After all, prices were unlikely to get cheaper, they inferred.

“The condo market was on fire last year when we bought, but we were reassured by the fact that our investment was only going to appreciate over time,” says Min, 30, who works in public relations.

The dual-income couple with no kids purchased a condominium apartment in downtown New Westminster last July, thinking all they needed to do now was keep paying the bills, and watch the value of the property grow.

Well, not so fast.

Recent measures aimed at cooling the housing market announced by the provincial government in the 2018 budget may do more than slow down rising prices.

As finance minister Carole James indicated after the budget was unveiled, the new taxes on speculation, foreign buyers and high-priced homes may even cause homes prices to fall.

While that would be good news for would-be buyers, it’s the opposite for recent buyers who could see the value of their home worth less than what they owe, putting their mortgage under water.

Lana Gilbertson, a licensed insolvency trustee with MNP, says this would seem like a stunning reversal of fortune for young homeowners. Yet the scenario is by no means novel for Greater Vancouver area.

“I was around during the recession of 2008 and 2009 when afterwards many homeowners who bought a year or so earlier saw the value of their home worth less than their mortgage,” she says.

Though unsettling, the situation wasn’t all that dire for most homeowners.

“Prices go up and down, and as long as people met their mortgage and other debt obligations, they were largely OK.”

Homeowners just had to wait it out until home values started moving upward again, albeit it took about five years for prices to recover fully, says Cameron Muir, chief economist with the British Columbia Real Estate Association.

Still, some homeowners—even if they could keep making payments—felt the pain more than others.

“The common complaint around 2013 and 2014 was many households looking to move up in the marketplace couldn’t because their home was worth less than it was when they had paid for it in 2007 or 2008.”

While prices did recover, the last downturn revealed it didn’t take a U.S.-style meltdown–where home values fell to a small fraction of their peak–to sow tremendous economic upheaval.

“What happened here paled in comparison to what you have seen in the United States at that time.”

But the downturn did have a negative impact for many homeowners in the Lower Mainland, Muir says.

Still, he adds that some of the new measures–including raising education property taxes on homes worth $3 million or more and hiking the surtax on purchases by foreign buyers from 15 to 20 per cent–are unlikely to cause prices to fall significantly, if at all.

But the new speculation tax—potentially an additional tax on vacation homes—may be a different story, Muir notes.

“We’re still looking for more details from the government in terms of who will be affected,” but if it does affect second-homes—like vacation condos—prices could sink across the board, Muir says.

Equally concerning is these regulations come at the wrong time in the market cycle—the peak—and fail to address the biggest driver behind soaring prices: supply.

Muir says the industry has been working to address this problem, building tens of thousands of new units in metro Vancouver alone.

But now this new supply could hit the market just as these dampening measures take effect, Muir says. Along with a peaking stock market and growing uncertainty regarding trade with the U.S, existing homeowners could experience a perfect storm of negative factors on the housing market, pushing values below what they owe.

 “It’ll mean we probably bought at the worst possible time,” Min says.

Yet homeowners can take steps today, so they can keep their heads above water financially even if their mortgages end up under water, Gilbertson says.

“More than ever it’s a good time to get your financial house in order.”

The small pains incurred now–cutting costs and paying down debt aggressively–could help avoid larger ones in the future. After all, even though homeowners may be able to keep up payments on an under-water mortgage, fiscal management becomes much more challenging if you’re making payments on multiple sources of debt.

Gilbertson points to experiences of indebted homeowners during the last recession. “One thing we saw was they could no longer access any further equity in their home because it had dissipated, so if they were unable to meet their consumer debt obligations, they were looking at bankruptcy or a consumer proposal.”

Moreover many lost their jobs, “and couldn’t make their mortgage payments,” facing foreclosure on their homes, she adds.

That’s not a major worry at this stage for Min, who says she is confident the couple can manage what may come because they practise good financial habits. 

“The most challenging aspect of managing expenses as a new homeowner is learning to account for unexpected maintenance costs and special levies, but once you have built in a contingency budget, the rest isn’t so bad.”

New rules… three tips to get your financial house in order:

While a housing market correction has yet to arrive, insolvency trustee Lana Gilbertson says homeowners are best served being proactive regarding their financial well being so they’re able to keep making mortgage payments in good times and bad.

Step one: Get the household finances under control. This means tracking spending and cutting unnecessary spending. Alternatively, you can increase income by selling items you don’t need anymore or taking on part-time or gig jobs.

Step two: Build an emergency fund so when the car needs repairs, or you lose your job, you have a pot of cash in a savings account and don’t have to go into debt.  “As a rule of thumb we suggest saving enough to cover three to six months of expenses.”

Step three: Create a realistic plan to pay down debt. This ultimately comes down to building a budget that can yield a couple of hundred dollars surplus every month that can go toward paying the highest interest debts off first.

© 2018 Postmedia Network Inc.

Main and Twentieth designed with its eventual occupants in mind

Mary Frances Hill
The Province

Main and Twentieth

Where: 209 East 20th Ave. Vancouver

What: A boutique collection of 42 one- and two-bedroom homes and loft homes. Most homes surround an interior courtyard with green space and lounge areas

Developer and builder: Landa Global Properties

Residence sizes and prices: From 620 square feet for a one-bedroom loft, starting from $799,900 to 942 square feet for a two-bedroom home, starting from $915,900

Centre Hours: by appointment only at Landa head offices downtown

Telephone: 604-879-8811

When Kevin Cheung surveyed the site at Main Street at East 20th Avenue, he saw a perfect spot for the type of people he wanted to attract to Landa Global Properties’ collection of condominiums.

He envisioned homebuyers who would savour life in a neighbourhood chock full of independent businesses, a community where a relatively young mix of owners, renters, artists, students, and urban professionals contribute to the area’s arts, culture and social scene.

The aptly named Main and Twentieth new-home project is designed, indoors and out, to mirror that sensibility.

“Our developments are designed to reflect and elevate the character and scale of the existing neighbourhood. Main Street is very trendy and modern and community-oriented, and our target audience of young professionals [enjoys] a very active lifestyle,” says Cheung, CEO of Landa Global Properties.

“[Potential homeowners] would love hanging out with friends and trying out new restaurants,” he says. “Our modern, contemporary design reflects the character of this neighbourhood and the lifestyle.”

Main and Twentieth is designed to include a courtyard space that would allow condo owners to look down upon a Zen garden, an outdoor lounge and green communal space to encourage sociability among owners, Cheung says.

The condos, which include lofts and penthouses with rooftop gardens, are compact, but designed to let the homeowner adapt the space to make room for a vibrant social life. The capacity of the indoor floor space could surprise visitors who expect a conventional layout in a relatively small unit, he adds.

“Homes at Main and Twentieth have very efficient floor plans. We specifically designed the kitchen layout without a kitchen island to add a sense of openness and to give homeowners the flexibility and room to place a six-seater dining table there if they want to.

“In either the linear kitchen or the L-shaped kitchen, that adds a sense of openness.”

The homes also include a flex space, which can be converted into a workstation or converted for storage, a pantry or a small den.

Landa, which specializes in luxury homes, spares nothing at Main and Twentieth. Textured wood laminate flooring and plenty of natural light — thanks to oversized windows in the suites — add warmth to the minimalist, neutral decor scheme.

“The overall interior design is contemporary and simple,” Cheung says. “The building’s exterior wood soffit element and the wood texture decor cabinet in the suite echo each other.”

© 2018 Postmedia Network Inc.

Canadian Real Estate Wealth

British Columbia’s privacy office says some landlords are asking prospective tenants for too much personal information including three months worth of bank statements, inquiring whether applicants were born in Canada and having them complete a behavioural questionnaire.

Drew McArthur, the province’s acting information and privacy commissioner, says 1.5 million people live in rental housing, representing about 30 per cent of all households in B.C., but the vacancy rate is so low across much of province that landlords are taking advantage of the power imbalance.

In a report, McArthur says his office receives calls daily from people worried about the over-collection of their personal information, but many feel they have no choice but to provide it so they don’t miss out on a place to live.

He says much of the information landlords require is protected by the Human Rights Code, but people concerned about their rights often don’t want to be identified or file a complaint for fear they’ll be blacklisted.

McArthur says landlords are authorized to collect a reasonable amount of information, such as references.

Sometimes age can be required for rental properties restricted to people over 55, but he says landlords cannot search for someone’s information on the internet or ask invasive questions, including whether an applicant plans to become pregnant within the next year.

The privacy office’s investigation is based on a review of 13 tenancy applications.

McArthur says people trying to rent have reported various incidents, including being asked about their immigration status and having to provide a copy of their child’s report cards.

Copyright © 2018 Key Media Pty Ltd