Vancouver Condo Real Estate Video Blog #660 - May 3, 2011
How's That Vancouver Condo Pre-Sale from 2008 Working Out For You?
Ian Watt video blogs about how many people got sucked in to buying a Vancouver Condo pre-sale in 2008 (at the peak of prices) and are realizing a loss on their investment of 20% or 25% deposit, consequently trying unsuccessfully to pass their losses off on re-sale rather than admitting they made a failed short-term investment. If you want to voice your opinion or if you don't care for Ian's comments please email your feedback to email@example.com and visit http://www.ianwatt.ca/RealEstateVideos for all the Ian Watt Real Estate Video Blogs. Please note that opinions, real estate practices, prices and data always changes over time, so please keep in mind the date when this video was published as the information could have become irrelevant over the past days, months and years. Copyright iWatt Media © All Rights Reserved 2011 www.iWatt.ca .
Ian Watt: Hi good afternoon it's Ian Watt in Downtown Vancouver. Real Estate we talked about that before everybody knows this, is something you do for long term. Vancouver we all got caught up well maybe not everybody but a lot of people including realtors got caught up in pre-sale hype. In 2007, I think I blogged about it don't buy any pre-sales and I still feel that way there's no reason to buy a pre-sale back at the day it was discounted so the developer he gets some money and perhaps you could see some sort of profit even if the market stayed at the same level. But of course cost a construction is gone through the roof and what were seeing is a lot of pre-sales that were bought in 2008 when the peak of the pre-sale hype was up there or starting to come to completion right about now in 2011. So what were seeing is a lot of this properties being completed on and people are not making a profit. And a lot of people buy to flip them. Now think about this even if you had a six hundred thousand dollar condo. Chances are you had to put 20% down, say that's a hundred fifty thousand dollars then you have your completion cost your HST or GST whatever you are paying at that time plus your commissions etc. And then you think your gonna make a hundred thousand dollars? Will you think with your commissions and all your HST and the property transfer tax that's going to be about thirty or forty thousand dollars on top of that six hundred thousand dollar property and you think you gonna make a hundred thousand dollars so you sell up for seven hundred if you can get that price. And it's a sixty thousand dollar profit on top of that you have to pay your capital gain tax which is probably 40% so what is that leave you with? You invested a hundred and fifty thousand dollars thinking you will flip out for profit that your only realizing twenty thirty thousand dollars. It's crazy and that's if you can make a hundred thousand dollar lift and a lot of people are doing that, a lot of the places that are bought in 2008 that are completing right now are selling at the negative. That's for sure. Nobody is willing to pay those prices especially for one bedrooms right now. You have to realize if your going to rented out, if you just hold on to it hod on to it for five or ten or twenty five years don't think you gonna hold it in two years flip it out and make a profit and if your going to take a lost take a lost now speak to your accountant how you can write it off. My name is Ian Watt and if you have any questions. You can always email me at firstname.lastname@example.org. Thank you very much and have a great day!