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OTTAWA (CP) – Sales of existing homes by MLS realtors in 25 major markets set a quarterly record in the third quarter of this year, the Canadian Real Estate Association says.

Third-quarter sales surpassed by 5.2 per cent a previous record set in the first quarter of 2002, and were 14.5 per cent higher than in the second quarter of this year.

The average price of $228,287 in 25 major markets in September also set a record, the association said Wednesday in a statement.

Sales by agents on the multiple listing service rose by 2.3 per cent to 27,580 units in September from 26,962 in August on a seasonally adjusted basis.

Pierre Beauchamp, CEO of the association, said “full-time job gains in construction, finance, insurance and real estate highlighted how strong housing activity continues to be a key support for economic growth.”

The association reports twice a month on MLS home sales, once on sales in 25 major urban markets and then on all markets.

© Copyright 2003 The Canadian Press

 

Sun

Kent Spencer
Province

Tenants and property agents should be aware of a little-known law that allows the taxman to come after them for their landlords’ unpaid tax, say advocacy groups.

“I was dumfounded when I heard about it,” said Linda Mix of the Tenants Rights Action Coalition in Vancouver.

“It’s hard enough being a renter without something like this.”

The law came to light after a Saltspring Island tenant received a $5,000 income-tax bill due on the landlord’s rental income. The woman’s foreign landlord eventually paid the bill.

Dan McGrath of the federal tax department in Victoria said the problem of delinquent overseas landlords “goes on all the time.”

“The Income Tax Act requires overseas landlords to pay 25 per cent of their rental income to the Canada Customs and Revenue Agency,” he said.

“On $1,000 rent, tenants should send $750 to the landlord and $250 to CCRA.”

McGrath said the tax department doesn’t usually demand payment from tenants who don’t know the rules.

“The law provides for that, but in practice we don’t go that way,” he said. “We tell the tenants to pay future rents directly to us until the landlord’s debt is paid off. They’re not out of pocket.”

But he said the department is tough on professional property managers because “it’s their business to know.”

“It falls on the agent to deduct and remit the non-residential tax. If the tax isn’t paid, we can present the agent with a bill because they should have known it all along.”

Mix called the law “scary” and said tenants shouldn’t be expected to know whether the landlord is paying his taxes.

“Tenants and landlords have a hard enough time getting along without a tenant having to ask the landlord if he’s paying taxes,” Mix said.

Under B.C.’s Residential Tenancy Act, she said tenants are not allowed to withhold rents except by court order.

“At the end of the day, it’s the landlords’ taxes,” Mix said.

Landlords’ rep Lynda Pasacreta said it shows the problems with absentee landlords.

“When the landlord isn’t there, he can’t check up on the type of tenant going in, if there’s a grow-op, or fix up the place,” said Pasacreta of the B.C. Apartment Owners and Managers Association. “An absentee landlord doesn’t work in any aspect.”

David Perry of the Canadian Tax Foundation in Toronto said the system was meant to be fair to residential taxpayers.

“There is no way of collecting taxes from non-residents,” he said.

“Wouldn’t it be nice to build up a portfolio of properties and move to Fiji, collect rents and not pay taxes? If a tax wasn’t imposed, it would discriminate against Canadian taxpayers.”

Perry said the law was obscure in many circles, but common knowledge among international businessmen.

“Money market managers doing business on Wall Street will withhold a non-resident portion for the tax department before sending a cheque to New York,” he said.

McGrath said tenants can easily set up non-resident withholding payment [trust] accounts.

“All they have to do is phone us,” he said.

© Copyright  2003 The Province

 

Daphne Bramham
Sun

Vancouver has had an urban rebirth that is the envy of many cities around the world.

But it’s time to start thinking about the next 30 years before the city becomes a victim of its own success.

The popularity of Coal Harbour, Yaletown and False Creek has proven that living downtown in a high-density neighbourhood isn’t a penalty paid by the poor. Rather it’s a lifestyle actively and aggressively sought by the very rich.

Surrounding the bristle of glass apartment towers are ribbons of bicycle paths, parks, playing fields, schools, restaurants and bars.

More than 19,000 people moved downtown in the past 10 years. There has been a 215-per-cent increase in population and the density on the downtown peninsula is 299 people per acre.

But it’s not just the number of people that has changed. Average Vancouverites have changed the way they live. Now, 67.3 per cent of all homes in Vancouver are apartments.

Even though the economy sucks, Vancouver‘s population growth is averaging 6,000 per year and is expected to grow to 635,000 by 2021. Most of the newcomers are moving into homes on land that once housed industries, factories, warehouses and other kinds of commercial activities.

So it’s time to think about what next even as demand for condos is still so high that developers are selling out before they break ground.

Vancouver is becoming a huge draw for Europeans, Americans and Asian who are purchasing second or third homes where they can spend a few weeks or even a few months each year. They come, dine out at much reduced prices compared to other international centres and enjoy what the city and the nearby mountains and ocean have to offer.

But what they’re not coming for is to establish businesses and it’s leading people like architect Bing Thom to wonder whether the downtown peninsula could become a rich enclave of retirees and foreigners.

“Will Vancouver people be happy being servants to the rich and retired?” Thom asks, rhetorically. “Will they be happy exporting jobs to Burnaby and Surrey?”

Worse still, Vancouver could become a kind of Aspen without the ski resort — a city where real estate is so expensive that most of the downtown workers with jobs in retail, hospitality and tourism will have to commute from the suburbs.

And that would be the antithesis of Vancouver‘s livable city plan, which is intended to cut down on commuting time and its attendant pollution.

Vancouver is already at a point where condo developers are bidding up the price of raw land to the point that Thom says it’s difficult for anyone wanting to build anything other than condos to compete.

Part of the reason the condo developers can do that is because about 60 per cent of the available land downtown is zoned for some sort of residential — including the live-work spaces that raised some controversy last month — and only 40 per cent is for commercial.

But the deeper problem is that there is very little economic activity downtown or anywhere in the province. Vancouver has lost all but a very few head offices and anyone who isn’t building condos has to be concerned about the lack of tenants.

Ever since Dennis Law and his brothers bought the old Ford Centre and renamed it the Centre in Vancouver for the Performing Arts, he has also been asking a lot of questions about what Vancouver might look like in the next couple of decades.

Law has a vested interest. The Denver-based brothers want to buy the city-owned parking lot behind the theatre to add to what they already own. They’d like to expand the theatre’s cramped lobby and administrative space by building a new cabaret-style theatre across the alley and a hotel, connecting it all together with a glass-encased bridge over the lane.

But it’s hard to compete with the condo developers who are interested in every scrap of downtown land.

“It’s good for the city to have condos built and they are being snarfed up at an incredible rate. But how do you sustain economic growth with no infrastructure for jobs?” says Law. “If all of the best land downtown is only being used for second, third and retirement homes, what kind of a city do you have?”

And as he points out: “With the rate of return you can get on performing arts space, it’s not possible to pay the same price for land as somebody who is buying it for condos or commercial space.”

Which is a bit a dilemma not just for the Law brothers, but for the city.

Law naturally favours cities with strong performing arts traditions. Not only are he and his brothers all very active in Denver‘s cultural scene, their parents are strong supporters of the arts in Hong Kong.

And as everybody knows, Vancouver is not a city known as a cultural hub even in Western Canada. But Law raises an interesting point: Why couldn’t Vancouver become one, and more specifically given the ethnically diverse nature of the city, why can’t Vancouver become a cultural centre where East and West blend?

Not only would a lively arts scene make Vancouver more attractive to its residents, Law cites a study done last year by the Colorado Business Committee for the Arts that found Denver’s cultural facilities employed 7,700 people, generated $1.8 billion US in 2001 and attracted close to 860,000 visitors from outside the state. Metropolitan Denver has about the same population as Greater Vancouver.

What the Colorado study also found is that throughout the 1990s, attendance rose steadily. A person who went to the symphony once in the early 1990s, went more frequently by the end of the decade, suggesting that entertainment dollars are not necessarily finite. Good performances and outstanding exhibitions at theatres and galleries bring people back.

Maybe Vancouverites aren’t interested in the arts and don’t want a cluster of cultural facilities downtown.

But it’s interesting to think about what that might look like and contrast it with a vision of what Vancouver will be if the current condo boom continues unchecked.

Maybe the current plan is the best one. But building great cities requires constant attention and frequent tweaking of plans. Now with the Olympics coming and all that construction set to begin, it is as a good a time as any to think about the future.

© Copyright  2003 Vancouver Sun

Ashley Ford
Province

Vancouver new home-building costs are out of step with the rest of the country. In fact they actually diminished slightly in August, while the rest of Canada saw costs rise an average 0.5 per cent last month over July.

Fourteen of 21 urban centres surveyed registered monthly increases. Six centres saw no change while Vancouver registered the only monthly decease of 0.2 per cent due to builders quoting lower prices because of competition.

On an annual basis, prices rose in all centres surveyed except Windsor, Ont., where there was no change. In Vancouver, they are up 3.5 per cent from a year ago.

Significant monthly price increases were observed in Hamilton, Saskatoon, Regina, Toronto, St. Catharines-Niagara, Ont., and Saint John-Moncton-Fredericton, mostly because of increased material and labour costs.

Higher land values were noted in Hamilton and Regina. Prices also rose in St. John‘s, Nfld., Kitchener-Waterloo and Sudbury-Thunder Bay in Ontario, Calgary and Edmonton.

For the sixth consecutive month, Quebec posted the largest 12-month increase for new homes at 9.3 per cent. Victoria was next with an increase of 8.4 per cent, followed by Montreal at 7.1 per cent.

Meanwhile, non-residential building by businesses and governments recorded its fifth consecutive quarterly gain in the third quarter, reaching a record $6.6 billion, says Statistics Canada. But in Vancouver, non-residential starts are running 7.1 per cent behind where they were a year earlier.

© Copyright  2003 The Province

‘Successful realtors are making very good money these days,’ Fraser Valley Real Estate Board president says

Bruce Constantineau
Sun

Lower Mainland house sales surged again last month, prices went up and successful realtors made “very good money,” Fraser Valley Real Estate Board president Reg Davies said Monday.

His comments came after the Fraser Valley board reported there were 1,679 home sales on the Multiple Listing Service last month — a 41-per-cent increase over September 2002.

There were 3,357 Greater Vancouver house sales in September, representing a 22-per-cent increase over the same month last year and the strongest September since 1992, according to the Real Estate Board of Greater Vancouver.

“Successful realtors are making very good money these days and if they’re not, it’s only because they carry too many assistants and have too many expenses,” Davies said in an interview. “They have had excellent unit sales and if they’re working smart, they’re making a good dollar.”

Realtors typically receive a seven-per-cent commission on the first $100,000 of a property’s value and 2.5 per cent on the rest, which works out to $12,000 on the sale of a $300,000 home.

Coldwell Banker Love Realty realtor Derek Love, who sells homes in Burnaby, Coquitlam, Port Moody and Port Coquitlam, said he sold 34 properties last year with average prices ranging from $180,000 to $280,000. He expects to sell about 50 homes this year, with average prices ranging from $350,000 to $600,000.

Love said he sold to a lot of first-time buyers in 2002, but catered to more existing home owners this year. He said prices of detached homes have increased by $75,000 to $100,000 in his area in the past year and the supply of certain homes has become very tight.

“In Burnaby, it’s tough to find something in the $450,000-to-$600,000 range — those properties are almost gone,” Love said. “A year ago, I could show a client 12 to 15 decent listings in that range, but right now I’m down to just two or three.”

He said multiple offers on properties are common now and some of his listings have sold for more than the asking price. A detached home listed for $349,000, for example, recently sold for $355,000, while a co-op unit listed for $239,900 sold for $250,000.

Love expects the strong market will last as long as mortgage rates remain low, but warns there could be trouble if rates rise by three or four percentage points.

“People are spending $350,000 for homes in Coquitlam that need $30,000 worth of work and they’re booking themselves a five-year [mortgage] rate at 4.7 per cent,” he said. “If rates are at eight or nine per cent five years from now, you can be guaranteed we’re going to have problems.”

Adera Group vice-president Howard Steiss, whose company builds multi-family housing projects throughout Greater Vancouver, said new units in Langley and Surrey — priced from $190,000 to $250,000 — are selling extremely well and about 70 per cent of buyers are first-time buyers.

“We release our projects in phases because it’s too easy to oversupply the market,” he said. “We’ll continue to bring on further phases as the demand requires. Until we see interest rates move up, the market should continue to be brisk.”

Greater Vancouver Home Builders Association chief operating officer Peter Simpson said the home-construction market is “steady and manageable” now because it’s not taking off like a rocket. New residential construction in B.C. rose 15 per cent during the first eight months of this year to 15,430 units, according to Canada Mortgage and Housing Corp.

“There might be a blip in housing starts from one month to the next, but the trend is steady and it’s up and we don’t see that changing any time soon,” Simpson said.

The benchmark price of a detached Greater Vancouver home sold on the MLS has increased by 12.9 per cent in the past year to $437,000, according to Real Estate Board of Greater Vancouver figures.

The price of an attached home rose by 13.4 per cent to $280,000, while the price of an apartment unit increased by 15.3 per cent to $209,000.

© Copyright  2003 Vancouver Sun

Just when you thought house prices couldn’t go any higher, historically low rates combined with pent-up demand are fuelling the already scorching hot Lower Mainland real-estate market

Jack Keating and Ashley Ford
Province

Rachel Beedle and Tony Spiess are among the throngs who have pushed Greater Vancouver home sales to record highs.

They bought their first home in Coquitlam three weeks ago for $343,000.

“The prices are quite high,” said Beedle. “I thought it was a good time for me. I owned an apartment before [we bought], so for me to sell my apartment at this time was a good idea.”

Royal LePage Real Estate Services said yesterday that the price of a detached bungalow in Greater Vancouver in the third quarter was $387,171, compared with $351,137 in the third quarter of last year, a 10.3 per cent increase. A standard two-storey was $448,187, compared with $399,809 last year, an increase of 12.1 per cent.

In Victoria, the price of a detached bungalow was $269,000, up 10.2 per cent from $244,000 in the third quarter last year. A standard two-storey was $287,000, up 5.5 per cent from $272,000.

Nationally, the average price of a detached bungalow rose 6.9 per cent to $235,055, a standard two-storey home 6.4 per cent to $262,016, and a standard condominium 7.0 per cent to $149,772.

Greater Vancouver sales last month rose 35.6 per cent to 3,357 units compared with 2,476 units in September last year.

Bill Binnie, president of the Real Estate Board of Greater Vancouver, said demand last month was the highest since 1992 and he expects it to continue.

“There is likely still some pent-up demand from consumers who have been holding off buying and selling,” he says.

Greater Vancouver prices show no signs of moderating. The price of a single-family home has risen 12.9 per cent from a year ago to $436,950, while a townhouse has risen by 13.4 per cent to $280,050.

The lower end of the market and sector of greatest demand, apartments, has had the highest increases. Prices have climbed by 15.3 per cent from a year ago to $209,280.

Fraser Valley sales jumped by 41 per cent in September to 1,679 compared with 1,193 in September 2002.

“The train keeps coming down the track and there seems no stopping it,” said Reg Davies, of the Fraser Valley Real Estate Board.

But there is some evidence of price fatigue in the valley. Last month the price of a single-family home was $303,365, down from August’s $309,267. Townhouses remained the same at $193,382 while apartments climbed to $123,008 from $121,958 in August.

Phil Soper of Royal LePage said “historically low interest rates have made this one of the most affordable times for Canadians to purchase a property. But buyers paid the highest average prices on record for their homes during the third quarter.”

He said the pace of price increases in Edmonton, Ottawa, Halifax and Toronto is slowing, while Calgary has become a buyer’s market.

There are other signs Canada‘s housing market — the Lower Mainland apart — may be cooling.

StatsCan reported yesterday that building permits across Canada dropped 13.4 per cent in August to $4.1 billion, down from a record high of $4.7 billion in July.

Housing permits fell 8.3 per cent to $2.6 billion after three monthly gains while non-residential permits plunged 21.1 per cent from a 14-year high to just under $1.5 billion, with declines in industrial, commercial and institutional.

Beedle and Spiess, meanwhile, said they decided to buy before it gets even more expensive.

“In the past year I’ve seen prices go up in Coquitlam and that was another reason I wanted to buy now, before they got any higher,” said Beedle, 29, a teacher.

Home buyers may not be able to take further increases.

“We’re starting to get some resistance on this for the first time in 18 months,” said Remax agent Wayne Dick. “We’re starting to hear some of the buyers say, ‘where are we going with this?”‘

SEPTEMBER HOUSE PRICES

Detached homes Attached homes Apartments

Sept. 2003 Sept. 2002 % change Sept. 2003 Sept. 2002 % change Sept. 2003 Sept. 2002 % change

Abbotsford $243,000 $216,900 12.0% $164,000 $135,900 20.7% $87,900 $79,000 11.30%

Burnaby $413,000 $372,000 11.02% $242,000 $216,000 12.04% $164,750 $142,000 16.02%

Coquitlam $364,000 $325,000 12.00% $222,500 $215,000 3.49% $140,000 $136,000 2.94%

Delta North $275,000 $240,000 14.6% $161,000 $114,000 41.20% $131,000 n/a n/a

Delta South $336,000 $296,000 13.51% n/a n/a n/a $190,000 n/a n/a

Langley $300,000 $262,000 14.50% $205,900 $174,000 18.30% $123,000 $116,500 5.60%

Maple Ridge – Pitt Meadows $279,900 $258,000 8.49% $167,000 $151,500 10.23% $106,500 n/a n/a

Mission $214,000 $175,000 22.30% $145,000 $148,500 -2.40% $95,000 $85,900 10.60%

New Westminster $345,000 $261,500 31.93% n/a n/a n/a $152,500 $135,000 12.96%

North Vancouver $530,000 $420,000 26.19% $300,000 $290,000 3.45% $203,500 $172,000 18.31%

Port Coquitlam $316,500 $268,000 18.10% $206,500 n/a n/a $116,750 $100,000 16.75%

Port Moody/Belcarra $385,000 $367,500 4.76% $197,750 $174,000 13.65% $150,000 n/a n/a

Richmond $380,800 $341,000 11.67% $256,000 $235,000 8.94% $161,000 $155,000 3.87%

Squamish $315,000 n/a n/a n/a n/a n/a n/a n/a n/a

Sunshine Coast $220,000 $187,500 17.33% n/a n/a n/a n/a n/a n/a

Surrey $303,500 $280,000 8.40% $198,000 $189,000 4.8% $122,000 $94,000 29.80%

Vancouver East $365,000 $295,000 23.73% $245,000 $258,000 -5.04% $150,000 $132,000 13.64%

Vancouver West $740,000 $598,000 23.75% $397,000 $320,000 24.06% $253,000 $235,000 7.66%

West Vancouver – Howe Sound $845,200 $717,500 17.80% n/a n/a n/a $365,000 n/a n/a

White Rock $400,000 $393,000 1.80% $270,000 $240,000 12.50% $167,168 $125,000 33.70%

Sources: Real Estate Board of Greater Vancouver, Fraser Valley Real Estate Board

© Copyright 2003 The Province

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