As usual, the mainstream media is generating fear of this and that. It seems to be generating some business for the opportunistic as I’ve heard tell of certain radio ads out there are taking advantage of this current fear. Sounds to me like the ever popular "sell the problem and the product will sell itself" approach where we are introduced to a problem we never knew we had, but suddenly seconds later we are shown how their product magically solves everything. This time, it’s about title fraud.
A few days ago, BCREA (British Columbia Real Estate Association), released the following statement in response to the growing fears that resulted as a result to these headlines:
Putting title fraud in perspective
Title fraud made its way into the media headlines earlier this summer, creating an unhealthy climate of fear that unnecessarily worried land owners. REALTORS® felt the heat too, as their buyers and sellers asked whether they and their properties were safe from fraud.
The facts are that BC’s land title system is one of the safest in the world, there is no pattern of increased title fraud and the Assurance Fund is available to compensate owners in the very unlikely case that they are financially affected by a title registration error.
There are more than 1.9 million active titles in BC. In the past 18 years, the land title system processed 15 million transactions—yet only two claims related to land ownership fraud and only 14 fraud claims related to lesser interests in land, such as discharges of mortgage, were paid out from the Assurance Fund.
The Land Title and Survey Authority is continually looking for ways to enhance the security of the system. If your client wants added protection, you can suggest these simple steps:
Owners, via a lawyer or notary, may use the Activity Advisory Service provided by BC OnLine. It notifies the legal professional when an application affecting the owner’s title is made to the Land Title Office (LTO).
Registry Agents can conduct title searches for homeowners wishing to check the status of their titles, and some agents may provide access to the Activity Advisory Service.
An owner who doesn’t have a mortgage or agreement for sale registered on their title can apply for a Duplicate Certificate of Title through their lawyer or notary, or at an LTO. No sale, transfer, mortgage or agreement for sale may be registered while the owner holds that Duplicate Certificate (the Duplicate must be stored in a secure location, such as a safety deposit box, to avoid the considerable time and cost associated with replacing it).
For a month or so now I’ve been hearing talk about a major expansion of the Casino that we have downtown, but the fact that I hear about it again and again makes me think that they must want it badly enough to push for all the media attention they’re getting. (I’ve heard a lot less about all the work that will be done to the mall it’s in for example.) I haven’t heard anyone say anything that was really against it yet, though I’m sure they’re out there, but even so it will still have to be cleared with the city council before they can go ahead and do it.
Here is an article I found in the Times Colonist, but it looks like it also ran in the Daily News as well.
Ryan Coffey
Casino plans major expansion
Downtown gaming business could double in size if city council approves
Darrell Bellaart
Daily News
Saturday, July 12, 2008
CREDIT: Daily News file
The casino is Nanaimo is planning for a major expansion.
The Great Canadian Casino Co. wants to nearly double its gaming space in Nanaimo.
An application going to city council on Monday calls for the construction of a 46,000 square-foot gaming facility in two phases.
The first phase would add 23,197 square feet to the existing 24,000 square foot casino, which would be replaced with a 3 1/2-storey parkade. Another 22,680 square feet of gaming space would be built above the new casino.
The company proposes to construct a semicircular glass-fronted building next door to the Vancouver Island Conference Centre. Inside, the casino operator wants to put 650 slot machines, up from 425 slots currently in operation.
City council members and downtown merchants, represented by the Downtown Nanaimo Partnership, like the economic benefits, and no one is fretting about adding 225 slot machines or doubling gaming space.
"I think it will go a long way to be another excellent addition to the downtown," said Coun. Merv Unger.
On the additional slots, he said: "It’s simply a matter of supply and demand. If demand is there, the casino will put them in."
Coun. Jeet Manhas said the development application is "great" for downtown. "It think it’s about time they started spending some money in Nanaimo and do a good job for the casino."
Nor does he see expanded gambling as negative for Nanaimo.
"Gambling is here and I would rather have a nice new facility to fit in with the conference centre (and) the hotel next door," said Manhas.
"It doesn’t mean more gambling, it means a better building. And with Port Place next door being redeveloped as well, I think downtown is starting to work. Everything we’ve done over the past 10 years is finally starting to pay off."
George Hanson, managing director of the Downtown Nanaimo Partnership, avoided commenting on the controversial aspect of expanded gambling. "From our perspective it increases the appeal of that destination and therefore it increases the likelihood of more people downtown, enjoying what the downtown has to offer," Hanson said.
"I know the Port Place shopping centre is planning a complete redevelopment of that site and there have been numerous drafts of what that site would look like."
The casino brings in about $3 million a year to city coffers, the city’s 10% share on gambling profits. That take would only grow, as conventioneers and tourists flock to downtown to spend evenings at the new, expanded casino.
The mall is owned by First Capital Realty, which also owns Woodgrove Crossing, Longwood Station, part of Terminal Park plaza and is buying the ground-floor retail portion of the Port of Nanaimo Centre, beneath the conference centre. It’s too early to say what it would look like after the casino expansion, said Mike Lowe, First Capital Realty B.C. managing director.
"It’s a big animal to tackle and we’re trying to obviously improve downtown to match it with the conference centre close by," Lowe said. "It’s not an easy task, let’s put it that way.
"I can tell you we would like to see some residential mixed-use. We don’t know exactly, we’re going through the steps right now."
He said it’s taking longer than expected coming up with a proposal that meshes with what the city envisions for the area, next to the Assembly Wharf lands where the Port of Nanaimo wants a cruise ship facility and some have suggested a multiplex should go.
Asked when he expects to have a development plan ready for the property, he said: "If you’d asked me that a month ago, I would say we’d have submitted it by now."
Below is an article about forclosures in B.C. from the Vancouver Sun.
As I am so often writing these days, people have a lot of misconceptions about what is going on because they don’t realize that what is happening in the US is not the same thing that’s happening here. For example, I often have to point out that we do NOT have high foreclosure rates here.
Yesterday’s headlines were no help.
The decision to no longer allow 40 year amortizations on mortgages was in my eyes not a sign of anything being particularly wrong with the Canadian real estate market. It was precautionary.
Here is what the ministry of finance had to say about it:
(an excerpt from a CTV article)
"Today’s announcement marks a responsible and measured approach by the government to ensure Canada’s housing market remains strong, and to reduce the risk of a U.S.-style housing bubble developing in Canada," the finance department said in a statement.
The finance department says reducing the amortization period from 40 years to 35 years on a $200,000 mortgage, for example, with a six per cent interest rate, would increase the borrower’s monthly payment by $41. The borrower would also save $49,000 in interest payments.
Keep in mind that as we entered the world of 40 year amortizations this past year, where hardly any of the money borrowed is payed back in a payment but interest instead, it has been uncharted waters. For quite a few years now, the purse strings have been getting looser and looser as more and more kinds of lenders are offering money to people who want mortgages. One of the results, is the rise of the mortgage broker industry as they put together packages choosing options from many different lenders and therefore are typically able to give better, more customized deals to borrowers.
The retraction of 40 year amortization to 35 year, has been discussed for a little while now, but now they’ve managed to make a decision. I’m not surprised, the lenders and borrowers have seemed a little unsure about it from the start, and now the government stepped in to make the decision for us.
Ryan Coffey
Foreclosures mount in U.S. but not in B.C.
Only one thing is important, experts say — the state of the economy
Fiona Anderson
Vancouver Sun
Friday, July 11, 2008
While the U.S. housing market continues to see mounting foreclosures, the number of mortgages in Canada and British Columbia that are in trouble are near all-time lows.
The introduction of 40-year amortization periods and zero-down mortgages two years ago appears to have had no negative effects.
And that’s because only one thing is important when it comes to foreclosures — the state of the economy, experts say.
In the U.S., almost one per cent of mortgages went into foreclosure in the first quarter of 2008, a record high, Sal Guatieri, a senior economist with BMO Capital Markets, said in an interview.
"And the scary thing is that the rate of change, quarter to quarter, was quite steep," Guatieri said.
In Canada, foreclosure statistics are not readily available. Instead the Canadian Bankers Association tracks mortgage delinquencies — which occur when mortgage payments are three or more months in arrears. The numbers are from Canada’s seven major banks, which together issue about 60 per cent of the country’s mortgages.
In B.C., only 0.15 per cent of those mortgages were in arrears in April 2008, the last month for which data is available. That number has steadily declined from about 0.65 per cent in 2001.
Meanwhile, 0.26 per cent of mortgages nationally were in arrears in April, a number that has held fairly steady since 2004.
"And by implication, the foreclosure rate remains quite low — if not historically low — in Canada," Guatieri said. "And it’s miles different from the U.S. situation."
That’s because of Canada’s economic situation, which has been "markedly different" than the U.S. situation, he said.
"We’ve seen much stronger job growth in the first half of this year while the U.S. has faced a steady loss of jobs," Guatieri said. "And Canadian home prices are still rising, although barely now, as opposed to falling over 15 per cent over the past year in the U.S."
With rising house prices, Canadians who get in trouble can sell their houses and move on, Guatieri said. That hasn’t been the case in the U.S. where as many as eight million households are what Guatieri calls "upside down" with mortgages greater than the value of their homes.
"And that means there’s just greater incentive for the homeowner to walk away from the mortgage [in the U.S.]," he said.
Canada’s situation is different, and a housing market problem here would more likely stem from a general economic downturn.
The Bank of Canada has numbers for how many sub-prime mortgages are in arrears. In the first quarter of 2008, 1.6 per cent of mortgages issued by Canada’s top three sub-prime lenders were behind by at least three months. That’s up from 1.0 per cent in the fall of 2006, when longer-term mortgages and zero-down mortgages were introduced. But it’s still a lot lower than the rate of about 16 per cent in the U.S.
And the sub-prime market in Canada is much smaller than that in the U.S. Last year the Canadian Association of Accredited Mortgage Professionals estimated that less than five per cent of Canadian mortgages were alternative, as they are called in Canada, compared to 20 per cent in the U.S. That number is even lower now as credit has become tighter because of the sub-prime crisis in the U.S., the association’s president and CEO Jim Murphy said in an interview.
Because the sub-prime mortgages are aimed at borrowers with lower credit ratings, "there’s no question that among those types of products you’d probably have a higher arrears rate," Murphy said.
But it’s unlikely that the federal government’s decision to no longer guarantee mortgages with 40-year amortization periods or zero down payments will affect the delinquency rate, said Michael Gregory, also a senior economist with BMO Capital Markets.
For there to be a rise in delinquencies "you’d probably have to wait for the economy to really weaken, the unemployment rate to rise sharply and then people have a harder time," Gregory said.
"And that’s not necessarily a function of the innovations that have been happening over the last couple of years," he said.
Instead it will be a "typical response due to the normal economic cycle."
The media is still reporting a cooling in the market like it’s ‘news’ but it’s really just more of the same pattern we’ve been seeing since the beginning of the year, just further along. The only real difference I’ve noticed in things since then is that there is a wider variety of perceptions out there regarding what the real estate market is doing.
I’m hearing some people who think it’s still booming while there are others who think the end is nigh, and all sorts of variations in the middle. Not surprising as the market isn’t strongly a buyer’s market or a sellers market, we’re hearing horror stories from the US while lots of people don’t realize that our market is separate, and some people have heard about the boom for so long that it hasn’t occurred to them that it might be over. I personally think that with the large inventory out there that it is slightly slanted towards buyers, as they have lots to choose from.
I’m seeing a variety of situations around my office. Some Realtors are busy handling listings and doing more price reductions, but making a bit sales than usual while for others things seem pretty normal. As for me, I’m busier than usual with more people than ever, so go figure. It’s not last year’s market for sure, but there’s still plenty of life in it.
Eventually, the general public will come to terms with the changes that have happened, and by then there’ll be newer changes to learn about. The adapting game continues. Play on!
Ryan Coffey
Home sales are cooling off here
Value is still good and there is lots to choose from
Darrell Bellaart
The Daily News
Monday, July 07, 2008
The latest home sale statistics show a slowdown in the local market and may also indicate that some sellers are asking too much for their homes.
“Sometimes sellers’ expectations are more than what the market is,” said Jim Stewart, one of four Vancouver Island Real Estate Board directors in Nanaimo.
VIREB realtors sold 111 houses in June, representing a 33% drop from the same month a year ago.
And while sales prices continue to rise, the rise is not as fast as a year ago, and realtors are pointing to the drop as evidence some sellers are pricing themselves too high.
The average selling price in June was $372,100, up 11% from last year, when it was $335,246. Buyers and sellers should use sales price numbers cautiously, since sales averages can easily be skewed when they include a lot of expensive properties.
But Stewart said those numbers are fairly representative of current conditions, since only three of 811 sales between January and June 30 sold for more than $1 million.
“Of the 811 sales, 338 were between $300,00 and $400,000,” Stewart said “One hundred and sixty-five sales were between $400,000 and $500,000, so the two sales values, that represent 50% of the market between $300,000 and $500,000.”
The median price is $362,000. The median price is determined by taking the middle number from the full range of houses that actually sold.
With some areas of Vancouver reporting slight drops, some buyers are holding off, thinking the same is about to happen on Vancouver Island.
“The favourite saying I hear is the bubble is going to burst. That would suggest we’re an overinflated marketplace and we just don’t have that. What we have is a market that is solid because it isn’t created by cheap mortgages,” Stewart said.
Nanaimo is still an affordable market where people want to live, and sellers whose properties aren’t moving should consider re-evaluating the price, he said.
Island-wide, sales volumes are down 30% from this time last year.
Cowichan Valley reported the greatest price increases this month, at 16%, to an average of $417,000. Campbell River saw the least increase, at 4%, to $330,000. Port Alberni still has the most affordable houses, at $243,000, but prices there rose 11% in June.
This is a topic that I’ve been seeing popping up in the local papers ffrom time to time in the past few months. Plans to build a large development and golf resort in Cable Bay (next to a rather nice nature trail by the same name south of town in Cedar) have been controversial from the start. But according to the article below, which I found in the Nanaimo Daily News, the movement is gaining steam. They have until August 5th to collect enough signatures to make the city of Nanaimo stop it from going through.
Looks like they’re likely to pull it off from what it says below.
Ryan Coffey
Petitioners aim to stop development
Protesters want vote on Cable Bay
Darrell Bellaart
Daily News
Thursday, July 03, 2008
Four thousand people have already signed on the first day of a campaign to prevent Nanaimo from annexing 90 acres of rural land for an 1,800-unit subdivision and destination golf course at Cable Bay.
Beverly Eert is leading a group of volunteers in a drive to get signatures from 5,815 Nanaimo residents and prevent the city from annexing 1260 Phoenix Way, an uninhabited property for the development.
They have until Aug. 5 to get those signatures. The city applied to the province in February to extend the city limits south to accommodate the development. Under provincial rules, a land annexation is considered to have local support unless at least 10% of voters sign letters saying otherwise. Nanaimo has 58,155 voters.
When the city set the Aug. 5 deadline, members of Save our Strategy, a grass-roots organization that opposes the development, originally said it would be too difficult to collect the signatures needed. But Eert is convinced it’s doable.
She and several volunteers set up a booth, with a handmade architectural model of the development during Canada Day festivities at Maffeo-Sutton Park on Tuesday, where she said she people were eager to sign.
"We got 405 signatures," Eert said. "If we had another half-dozen volunteers, we would have got double that. There was tremendous opposition, mostly to the process."
So far, Cedar residents have been the most vocal opponents to the development, which would be right in their backyard. Eert, who lives in Cedar, said this proves city residents also oppose the annexation.
"Most of the people didn’t know much about the project. I would say it was ignorance. Once they looked at the model and listened to what we were saying about the process, people said it wasn’t democratic.
"Remember a few years ago, when Shaw (Cable) said they were going to add a few channels and bill us for it, unless we said not to? A lot of people said it was like that."
She said the city should hold a referendum. "If we get 6,000 signatures, we’ll have to go to referendum anyway. We will force them to do the right thing, however expensive it may be."
Only signatures of qualified Nanaimo voters can be counted under the so-called alternative approval process. Qualified voters must either live in or own land inside the city.
Steeping slightly outside my usual realm of juts Real Estate, I wanted to put the call out to toher business owners and consumers in the area to stop just talking like you care and do something about it.
I’m currently trying to get in touch with all businesses in the area who are trying to do more than just what is expected of them in terms of doing business in an eco friendly way as I would like to start a local collective of local eco businesses. My vision is for us to get together so we can network, send each other business/clients while putting some pressure on the world around us to move towards a sustainable way of doing business. As a group, such eco minded businesspeople could certainly make a positive difference as well as help our businesses grow. If you happen to know of any businesses or business people in the central Island area who are trying to raise the bar in terms of doing business sustainably, would you mind writing to me and letting me know the name of the person/company? I have a couple already, but the list should be longer in my eyes.
Someone came up with a similar idea a few years back and I bought into it. I’d like to share it with you, it’s called "one percent for the planet ", and organization to which, I am a member. Another blogger has made a list of all the BC businesses who are part of it here .
And here is the explanatory video with music from Jack Johnson:
Later this month it will be my turn to donate 1% of my revenues to some charities which I’ll select from their long list. Looking forward to it.
I first read about this in the local paper yesterday and immediately thought it to be the beginning of a major event in Nanaimo real estate were it to occur. I’m willing to bet that it will be a controversial subject for Gabriola Island residents as their having to rely on a ferry to make it into town is simultaneously what gives Gabriola its charm as well as being a ball and chain. You see, if you miss the last ferry while on the Nanaimo side of the water… you’re stuck for the night. Plus you have to arrange your life around the ferries in general, not to mention pay for the ferry. A reason why after having lived there for a time, people fairly often give up on it and move into Nanaimo proper. However, there are those who live out there specifically for the semi isolation. You can see the source for controversy here.
Personally, I’d be surprised if it went through as I think that in even if the movement does gain enough support from those on Gabriola to go ahead, there will be the additional hurdle of convincing people to actually put tax money into it.
Regardless, I’ll be watching this with close interest because if plans for a bridge are announced, I’ll be very interested in buying some Gabriola real estate as I really think prices will go up there quickly once it becomes easy to access.
Below is an article on the topic from the Nanaimo Daily News.
Ryan Coffey
Robert Barron
Daily News
Saturday, June 28, 2008
CREDIT: Daily News file
Gabriolans marched in protest of ferry fare increases in March.
The idea of building a bridge linking Nanaimo with Gabriola Island refuses to go away.
The much-ballyhooed concept was raised again Friday. B.C. Ferries CEO David Hahn told radio show host Vaughn Palmer on Friday morning that the corporation is willing to spend $5,000 to conduct a survey of Gabriola Island residents to determine if they would rather have a bridge built, or continue with its ferry service to Vancouver Island.
B.C. Ferries spokeswoman Deb Marshall said the corporation had received a request for the survey after the corporation applied for fuel surcharges of 8-9% on major routes and 15-20% on smaller routes, including Nanaimo-Gabriola.
The substantial surcharges, which the corporation hopes will be in place by August, must be approved by B.C. Ferries Commissioner Martin Crilly before they become effective.
“First, we must discuss the survey idea with our ferry advisory committee on Gabriola Island to see if they support it,” Marshall said.
“If we decide to conduct the survey and the majority of Gabriola Islanders support building a bridge, then we’d take the matter up with the Ministry of Transportation.
“Gabriola is the only island we serve where we’re considering conducting a survey at this point because it was the only one from which a request was received.”
The idea of building a bridge between Nanaimo and Gabriola Island has been talked about since the 1960s.
As I’ve been writing for a couple of months now, we’ve been seeing a return to a more balanced market. Below is an article that speaks of it on the national level. The article’s title is kind of “Well, we knew that already… a couple of months ago.” for those who pay attention to these things at all, but some of the details it brings up are rather good info.
In Nanaimo we’re seeing a lot more listings as some people are trying to cash in their chips. Whether their timing is right or not, this action alone slows down the rise of prices and gives buyers the opportunity to pick and choose. At this point it’s not really clear who is running the show, but buyers are certainly in a better negotiating position than they were in the recent boom.
And again, I reiterate that the best time to buy a home is when you can afford it and need one. People who just need homes don’t need to worry a whole lot about the real estate market as long as they’re in a position to make their mortgage payments. Prices go up and down in the short term and up in the long term. FYI, you can buy a decent condo around Nanaimo for about $1000/mo. plus utilities. (That’s including the strata fee.)
Ryan Coffey
Canada’s housing boom is over, bank says VIRGINIA GALT
Globe and Mail Update
After a long run of rapidly-rising prices, the Canadian housing market has cooled to the point that it is no longer a sellers’ market, Toronto-Dominion Bank said Thursday.
“The long-awaited end of the Canadian housing boom has occurred, reflecting more moderate demand and increased supply of properties for sale,” TD economists Craig Alexander and Pascal Gauthier said in a report.
“The year-over-year price growth for existing homes in Canada’s major markets fell to only 1.1 per cent in May, down from 8.6 per cent just four months earlier,” the TD economists wrote.
“The trend has been broadly based, but is has been particularly sharp in some of the markets that had experienced the most dramatic price growth. Calgary and Edmonton home prices in April and May fell to below year-earlier levels.”
The TD economists said they had expected the slowdown to occur before now, but “housing remained stronger for longer than we had anticipated, largely due to increased affordability through new financing options, such as no money down or extended amortization.”
Regional economic strength related to the commodity boom also helped to fuel “unsustainably elevated home price growth in the west,” they wrote.
Last month, the Canadian Real Estate Association reported that resale home listings across Canada rose by 17.7 per cent in April from a year earlier – pushing the number of home listings to the highest level on record.
At the time, Bank of Montreal economist Douglas Porter noted: “For the first time in a long time, sellers are not in the drivers’ seat any more. I’m not necessarily saying that buyers are in the drivers’ seat either, but what we’ve seen truly is a return to a balanced market.”
The TD economists concurred in their report Thursday.
“Most of Canada’s major housing markets have moved out of sellers’ territory to more balanced markets.”
Mr. Alexander and Mr. Gauthier forecast modest national average price growth of 2 per cent this year and 3.5 per cent in 2009, “down substantially from the 10 per cent annual pace of the last six years.”
However, the Canadian housing market remains fundamentally strong, unlike the U.S. market, where the National Association of Realtors reported Thursday that median home prices continued to fall. The median price of an existing U.S. home sold in May was $208,600 (U.S), down 6.3 per cent from a year earlier – fallout from the subprime mortgage crisis.
In Canada, the TD economists forecast an average existing home price of $313,300 (Canadian) in 2008, up 2 per cent from last year’s average.
Canadians, the TD economists said, are “cashing in, not foreclosing.
“… It should be stressed that the rise in listings does not reflect homeowners of principal dwellings desperate to sell, and this is the dominant difference between the Canadian and U.S. experience,” they wrote in their report, Canada’s Housing Boom Comes to an End.
“Indeed, the U.S. has been characterized by an abnormal rise in delinquencies and foreclosures or large negative equity positions. In Canada, speculators may be quickly dumping properties on the market to get out while the times are good, but individuals that have a principal dwelling are not under financial duress.
“Canadian consumers are nowhere nearly as leveraged through their home equity as American consumers are.”
Throughout the rest of this year and 2009, most regional housing markets in Canada “will see low to mid single-digit gains, but Saskatchewan and Manitoba will continue to post double-digit gains in the near term, followed by a significant cooling in 2009 – with the risk of a mild price correction in the major cities that have recently experienced extraordinary price growth,” the TD economists said.
“Alberta will have further weakness in the near term, as Calgary and Edmonton will likely see prices continue to fall for another three or four quarters, dropping 8 per cent to 10 per cent from their peak, after which prices should stabilize and start rising at a low single-digit pace.”
Here’s a short video tour of Nanaimo I just came across on the web. It starts off with showing some of the scenes of the waterfront downtown and eventually pulls into the parking lot of my office to visit the ducks in the lake behind it. Below the video, I’ve time indexed the locations and put them on a map so that those of you who don’t know the area can get an idea of where these places are.
0:00
The walkway along the waterfront where there are numerous shops, restaurants, float places that will take you to Vancouver (or the airport) in 20 minutes , ferries to Newcastle Island (a park) Gabriola Island, and Protection Island. There is a small beach for swimming there as well. The large blue boat you see is the catamaran that was until recently a foot passenger ferry from Nanaimo to Vancouver, which may or may not be revived. (The company had some financial issues although it was fairly popular.) Behind the boat, there is the Dinghy Dock Pub which I’m told is North America’s only floating pub. Oh yes, and all around you is waterfront park. On the real estate side there are waterfront condos and a shopping mall across the way.
1:32
You see an image of someone driving in the highway, the white building on the right is my office, with the Coast Realty sign. (Which you can’t quite make out, but that’s what it says.) The car pulls into the parking lot in the back where you see some ducks hanging around the edge for Long Lake. A popular place to swim, go boating, waterski and go for a stroll. As you can see in the video, there are houses that are situated to peer over the lake and take advantage of the view.
Zoom out a bit to see both of the location markers.
