Changing Landscapes

Two weeks ago, Andrews Group listed a home in South Granville. More accurately the area is closer to Kerrisdale than South Granville, but MLS categorizes it as such.  

Quiet tree lined streets, well groomed laurels, mature rhodos, and a luxury car or two in most every driveway; this district has always been desirable with the well to do.  As early as 1905 families were attracted to and settled in the area.  A charming neighborhood quickly developed with a mix of bungalows and upper scale family homes, many with character of an era gone by.

Kerrisdale

Prestige, central location, (smack in the middle between downtown and the airport) great community with good schools, an elegant mix of shops and restaurants attracts keen interest from the real estate market. It’s a highly desirable spot and the price of a typical home here is exceedingly high.  A classic home in this area resembles the picture below and sells for around 3 million dollars.

 

Welcome to the 80's

In the 1980’s Vancouver experienced an influx of foreign buyers, mostly from Hong Kong, in search of status wielding properties, these buyers were not ones for older homes.  During this period, many homes on the desired west side were purchased and torn down.  In their place massive homes utilizing the maximum possible square footage for the property, were built.  Though there was some outcry, not much has really been done and the typical home being built in the 80’s looked like this:

The 80’s, not the best decade for taste, I should know (I had the clothes and hair style to prove it), and a somewhat hideous style of home was being built by most developers - not so classic or classy.  Case in point, this home doesn’t conjure up the same “Leave it to Beaver” feeling many us equate with a neighborhood of character does it?  Where is the charm?  In that semi-circle?  Unfortunately many of these were built – it’s called progress and development and neighborhoods change.  

In municipalities with an official Heritage Register, buildings are categorized based on their historical importance, such as Vancouver’s A, B, and C classes, or North Vancouver’s Primary, Secondary, and Supplemental classes.  These classifications reflect the building’s level of protection against future alteration or demolition. In most municipalities, homes in the highest heritage category cannot be altered without municipal approval, but many nice homes exhibiting some character of the period don’t fall into heritage status and are open season for builders.  Such was the home we listed.

Multiple Offers

Our little old semi character home was extremely desirable, not only was it on a great street and on the right side of the street, but it also carried an authentic 8 at the end of its address.  It’s notable that every other home in that block now also ends with 8 – an option available at the city of Vancouver for a mere $200 for a lifetime of wealth coming your way.  The same option can be purchased in West Vancouver for $1,000…

Of course, acting for the sellers, it was our strategic plan to build up as much interest as possible.  We limited access and advertised in the Chinese Real Estate weekly, Real Estate Weekly, Outlook, MLS.ca, REW.ca, andrewsgroup.ca, elaineandrews.com, Craigslist, and a 7000 pc mailout as well - massing tension in the buyers.  The calls, e-mails and texts grew each hour as we grew closer to the day of reckoning.  The agent’s open and the public open were well attended.

Groups of buyers, whole families of 2 to 8 politely toured through and inspected the offering, taking additional pictures, conversing in foreign languages and walking the property.   Those with interest made enquires of the sellers expectations.  We kept track of all attentive parties and kept them apprised as time went on.  When the actual day arrived, the interest had grown into a frenzy of communications. 

The Day of Execution

On the day, anticipation and pressure was high for both buyers and seller.  We received over 50 texts and 65 phone calls about this property on that day alone– it was insanity.  Two buyers came directly to us to write offers because they thought they were hedging their bets by going through the listing realtor (always love that). Offers were at 5:30 on a Monday evening.  We arrived at 5:15pm with 2 offers already in hand, 2 sent on e-mail en-route to the house.  Outside the home was a parade of black SUV’s, Mercedes and BMW’s lined along both sides of the street with agents and a few buyers talking amongst themselves in heavy discussion about the item up for bids.  The games had begun.

The Seller

Inside the house was Margret, our lovley owner of the home, along with her children and their spouses, anxiously waiting.   Margret looked all of 90 pounds, fit, well dressed and sharp as a tack.  She had paid $27,500 for this home and it was home for the last 50 years.  She wasn’t sure where she was going to go and hesitated selling because of it, but she knew the home had outgrown her and her family encouraged she move to something more suitable, closer in and safe. It was perhaps beyond time.

The Presentations

And so it began, ahead of schedule, why keep everyone waiting?  It was difficult to manage the order of presenters because we weren’t sure who was there first or in what order others were arriving.  A particularly zealous realtor, who had been in constant contact, was anxious to be first and so initiated the process.  A somewhat young agent, well-dressed, very polite; her clients, new to Canada, were a family of three and were waiting outside. 

It’s wise to have the client available in a multiple offer.  Should any changes need to be agreed upon, it can be dealt with right there.  Our first agent beamed about the creditworthiness of her clients and reverently covered the details of her offer to the attentive sellers seated around the table - including Margret.  The offer was strong, over asking and there was a deposit cheque, but she had subjects.  

Though this first offer had promise, expectations were high and we had 12 more to review.   One after another each agent sat down and presented the terms of their offers, some very professional and prepared, others looked like they had just finished a walk with the dog, then popped in last minute with an offer.  One of them brought his client right to the table and wrote in the dates and details through agreement with us.  Four agents brought bank drafts to show they indeed had the deposit, most were subject free, most were close to or over asking, but each was different and we kept the best on top.

Some offered that Margret could stay in the house for little or no rent for a period of time, one suggested she pay market rent at $5,000 per month.  It was difficult for Margret to imagine paying $5,000 a month when she had paid $27,500 for the property to begin with.  We tried to explain this to the agent since financially his was one of the best, but he would only reduce it to $3,500.  

Agents revolved in and out of the door, introductions and presentations carried on.  There was continual interruption of my  phone ringing with calls to check on status and texts were jingling even more frequently.  These calls could not be ignored as each was potentially an integral part of the process.  To say it was hectic would not aptly describe the scene – it was madness. After a while Margret grew tired of the procession and began asking everyone if they wanted anything while she mulled about in the kitchen sorting out nuts and cookies.  She seemed a little bored, but the family was enjoying this and the tension turned to excitement as the money grew.

Almost 5 Hours Later

Emotions were high on both sides of the table.  It became clear there were 5 of 13 offers serious enough to give each of the agents the option to sweeten their deal. And theydid, as subjects were removed, prices went higher, and possession became more acceptable.  Considering this was a multiple offer situation to begin with, it never ceases to amaze us how much more room is still available.  If someone really wants a property, they can usually dig a little deeper and find a little more – in this case that was from $75,000 to $200,000 more. The offer process had turned into an auction with each agent outbidding the other.  Everyone on their phones negotiating with their buyers or consulting them on the street, vying for the top spot.  All of us were on low battery with our cell phones and were scrambled to recharge into anything.- there are few plugs in old houses!

Settling on the Best of the Best

The 5 best contenders were whittled down to 3, the 3 played against each other. In the end we settled on the highest bid with the best odds of completion, and the best terms for our client. $300,000 over the asking price, no subjects, a deposit cheque for $600,000, closing in 3 weeks and the ability for our client to stay up to 4 months at no cost to her. 

Final signatures were signed, offer accepted and the deal was done.  It took almost 5 hours.  The winner of the bids?  A buyer from  China who has never even stepped foot in Vancouver…

Through our sales process we knocked on a few doors in the neighborhood.  The older residents were sad to hear Margret was leaving. “It will be bought and torn down” they said, some of them asked us if the house would stay, but sadly it will not.  It will become another 5 to 7 million dollar mansion in 2014 style. This neighborhood will continue down its path of change for better or worse.  

Multiple Offer Facts:

  1. Just because you have multiple offers does not mean you will get a no subject, over-asking offer. You will still get anything and everything in an offer.
  2. Pricing your home below market does not guarantee multiple offers. There are no offers till you have a written offer in hand – talk is cheap.
  3. You don’t have to accept any of the offers on your home if they are not agreeable to you – even if it was over asking with no subjects.
  4. Some buyers will pull out because of the multiple offer situation – the competition is not for everyone and you can lose a good buyer.
  5. Having a cheque along with the offer is most comforting – buyer’s remorse is likely to kick in the next day.


The Numbers

The graph is growing as we are already ¼ way into the year.  Looking at the sales we can see we were off to a good start, but it has been little slower the last 6 weeks on the NorthShore.  This is not the case with the Westside, where the number of sales has been edging upward.  However note how many properties in North Van are going over the asking amount!  Many of these properties are in the $1 million range as buyer are putting pressure on this end of the market. 

Days on the market are also reducing as we are clearly into the spring time and activity level is high. 

Of course the number of listings continues to increase and we will likely see this till around mid/late June. 


The Graphs

The graphs show us a picture of the last 4 years of listing and sales in both West and North Vancouver.  It’s one of the easiest way to see how the year is stacking up.

WV listings are creeping up, and have leveled as discussed above in the The Numbers spreadsheet, but we can see they are remaining below 2013 which was a year with a lot of supply. 

WV sales started out well, had been dipping a bit and now a sharp rise, big change from last year.  We are hopeful this will continue in the upcoming weeks as activity feels like it has improved now the long spring break is over!

NV listings are also on the rise and reaching up to 2013 as well and though sale prices have been strong, actual sales have leveled at last years number. 

 


 

Court Ordered Sales

Chesterfield - interesting alternative to apartment living with 800 sq. ft for $599,000 in an almost new home.

W 19th- listed 9% below assessed value in a great central Westside location

Norvan - purchased for $340,000 in 2008 in Sechelt on the struggling Sunshine Coast

Ontario - listed at only 76% of assessed value, owner lives at Angus Drive?  and acquired the property in 1992