Investors dumping Metro Vancouver homes at a loss as bubble bursts

By Amy Chen

Investors who bought homes in Metro Vancouver last year at the height of the bubble are dumping them at a loss to flee the market in a hurry as prices continues to tumble, recent sales listings show.

The dumping is most noticeable in the detached house segment, where prices have been plunging since peaking in May of this year.

The average price for single family homes have plummeted by 12% from $1.83 million[1]http://www.rebgv.org/sites/default/files/REBGV-Stats-Package-May-2017.pdf
to $1.61 million[2]http://www.rebgv.org/sites/default/files/REBGV-Stats-Package-August-2017.pdf
in the three months since May.

The property at 6633 Broadway, Burnaby was put on the market for $1,299,000 last week[3]http://archive.is/jsYds after being bought for $1,460,000 in May, 2016[4]https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAzVldDMg==, for a potential 11% loss.

The owner is listed as a student by the name of Ruixin Wang, according to title registered at Land Title and Survey Authority of British Columbia, which also showed that CIBC offered the student a mortgage for the purchase.

British Columbia Attorney General and former housing critic David Eby found evidence last year which showed that nine students owned bought homes worth $57 millions Vancouver’s exclusive Point Grey neighbourhood[5]http://www.news1130.com/2016/09/27/homemakers-students-own-107-million-in-one-vancouver-neighbourhood/
.

“And when we looked into it, we realized that one of the students who was on title for one of the properties had actually bought and sold another home during the period making $1.15-million in the process, and raising questions for us, for how that was possible,” David Eby told reporters at the time.

CIBC used to advertise mortgages for students with no income verification or credit history, but the page advertising the service has been taken down[6]http://archive.is/snWYC.

The property at 9579 Neill Place, Richmond was put on the market for $2,480,000 last week[7]http://archive.is/h7z8p after being bought for $2,500,000 in March 2016[8]https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA1V1lQRQ==.

The owners are Luxor Homes & Developments Ltd. and 0780012 B.C. Ltd. according to the title registered at LTSA, and financed by Montreal Trust Company, a subsidiary of the Bank of Nova Scotia.

The investors seem to be heeding the warning issued by authorities both in China and Canada warning of “problematic conditions” in Vancouver’s housing market.

“Metro Vancouver’s housing market continues to show strong evidence of problematic conditions due to moderate evidence of price acceleration and strong evidence of overvaluation,” Canada Mortgage and Housing Corporation warned in its 2017 third quarter Housing Market Assessment.

“Overvaluation is detected when house prices remain significantly above the levels warranted by fundamental drivers of housing markets such as income, population, and actual and expected financing costs,” according to the CMHC.

The listings have been taken off the Multiple Listing Service, possibly indicating that the owners were successful in discarding their rapidly depreciating assets.

[Photo Credit: Tarik Browne]

References   [ + ]

1. http://www.rebgv.org/sites/default/files/REBGV-Stats-Package-May-2017.pdf
2. http://www.rebgv.org/sites/default/files/REBGV-Stats-Package-August-2017.pdf
3. http://archive.is/jsYds
4. https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAzVldDMg==
5. http://www.news1130.com/2016/09/27/homemakers-students-own-107-million-in-one-vancouver-neighbourhood/
6. http://archive.is/snWYC
7. http://archive.is/h7z8p
8. https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA1V1lQRQ==

14 Responses to Investors dumping Metro Vancouver homes at a loss as bubble bursts

  1. Anonymous says:

    Prices in Burnaby have been in freefall mode for a while now.

  2. Jonny Wong says:

    Ms. Chan, you have a patriotic duty to not report stories like this. You are putting peoples equity in danger.

  3. wbg says:

    About time prices fall and next we have to send the [removed] home

  4. Anonymous says:

    Amy Chen you stupid bitch. My house has been on the market for three months and nobodys buying because of idiot reporters like you. For god’s sake stop spooking the buyers.

  5. sendchinershome says:

    take back all the properties bought by the asian invasion of laundered money and our crooked government letting it happen send them to jail for a couple years. screwed every other natural canadian out of the housing market stuck to rent. no doubt why people become racist.

  6. Anonymous says:

    This is the worst written article I have ever read LOL!… Someone needs to do a little more research hahahaha.

    • anao says:

      Go buy a house then or even better become a realtor in a down market Actually go buy 2 or 3 houses and sit on them. Then go get a CAT scan.

  7. Anonymous says:

    I think this is a very narrow view of the entire market- there are many reasons a property sells for little or no profit. And properties selling for large amounts below asking only indicates the property was overpriced to begin with- it might be a good idea to speak to a professional that works in the industry – rather than select a few properties that support your view! Perhaps speak with the presidents of the real estate boards and get the information first hand- and then write a correction to your stories.

Leave a Reply

Your email address will not be published.