Tuesday, April 24, 2012

Tues Post #2: Richmond continues to struggle - but not according to the mainstream media

Was it only January 2011 when we were comparing the red hot real estate market in the Vancouver suburb of Richmond to Holland's historic Tulip Mania?

Then came the Tsunami in Japan and as we predicted, Richmond was about to undergo a massive Paradigm shift.

Richmond has gone from a sellers market to a market where inventory is building up in a massive way.

In fact it was that growing inventory that prompted one seller we profiled to accept an offer almost $1 million lower than his asking price (an amount which was 40% less than that original asking price) in order to sell in that stagnating market.

And make no mistake, Richmond is stagnating.

As VREAA noted two days ago,  Richmond inventory has hit all time highs. Richmond detached home inventory is now over 1,021 homes available for sale.

It's been a deadly combination... increasing inventory and sales which have continued to tank month after month.

According to Richmond Realtor James Wong, the total number of homes sold in March, 2012 came in at a paltry 309 units, a drop of 5% from the total number of sales in February (324).

The total number of detached homes, townhomes and condos/apartments listed for sale at the end of the month totaled 2,330 units, an increase of 11% from February's total inventory of 2,100.

Wong pointed out the silver lining when he noted that the supply of homes in Richmond at the end of March resulted in an Months of Inventory total of 8.24 months, a slight decrease compared with the previous months figure at 8.82 months of inventory.

But the problem is that the overall supply of detached homes, townhomes and condos increased those listings overwhelmed the increase in sales.

And while Wong tries to spin the positive on the news at the end of his report, bear blog followers pass on a different story entirely.

VMD tells us:
“There are more and more people over at the Chinese [internet] forums reporting price drops in their neighborhoods (be it Richmond condos or Coquitlam SFHs). More people are voicing their skepticism that Vancouver RE market will continue to go up. Many already accept the view that Van RE price will decline at least a couple % this year.

People are noticing the glut of thousands of upcoming Richmond condo units, and are advising against buying at this time. A few people are saying their close/trustworthy Chinese Realtor friends are saying the RE market isn’t looking good; however the other Realtors (whom they’re not close to) are still trying to paint a rosy picture.

Sentiment is changing, even among the HAM.”
Of course don't let all these 'facts' get in the way of believing in the future of the real estate in Richmond.

And naturally it's the Vancouver Sun who leads the cheerleading charge.

Recently the Sun provided us with 24 Reasons Why Richmond Real Estate is Booming.


You simply can't make this stuff up.

So here, for your entertainment purposes, are the Vancouver Sun's top 24 reasons Richmond real estate is 'booming':
  1. ASIAN INVESTMENT: With a mountain of money trying to get out of Hong Kong and china in expectation of economic collapse, the stability of Richmond real estate has drawn many investors to purchase property sight unseen. Reports of tour buses being taken from property to property, and strangers offering briefcases filled with money at the door are no longer uncommon.
  2. SPORTS FACILITIES: Richmond has invested in all-weather sports facilities at a variety of local parks, as well as the much-hyped Richmond Olympic Oval, which hosts a wide array of sporting events, both amateur and professional.
  3. SALMON: If you like fresh salmon, being able to walk down to the fishing boats and buy it fresh out of the water is a big plus.
  4. BEDROOM COMMUNITIES: While Richmond has a reputation as an Asia-centric area, there are a growing number of communities that are entities all to themselves. The cultural contrast between Richmond Centre and Steveston couldn't be any starker, #5 Road's 'highway to heaven' presents a community of different communities, there are Ukrainian enclaves, Asian suburbs, spillover New West suburbs, and a growing number of young urban professionals around the Canada Line. The River Green development by the Olympic Village will be a small city of its own when it's completed.
  5. SUMMER FUN: On summer weekends, thousands of people invade Richmond to take part in events, amateur sports, walk the docks and buy fresh fish.
  6. FOOD SECURITY: Richmond is the last place in Metro Vancouver where food is locally grown in commercial quantities.
  7. PLENTY OF DEVELOPMENT: Richmond's city council has a reputation for being developer-friendly, recently having allowed the construction of B.C.'s first wood-constructed six storey apartment building, which was consumed by fire before it could be completed.
  8. THE DAILY MASSEY TUNNEL JAM: While home prices in nearby areas such as Ladner and Delta are comparably inexpensive, the dependence of commuters on having to make it through the Massey Tunnel during peak hour is a big turn-off for many.
  9. THRIVING ARTS SCENE: From the often-photographed derelict houseboats of Finn Slough to the gigantic heads on display at Lansdowne Centre as part of the recent Biennale, to movies on the beach at Gary Point, to packed houses at the Gateway Theatrem Richmond has formed a growing local arts scene that fees the cultural needs of locals and immigrants alike.
  10. GEOGRAPHY: The simple fact of it is that nobody is producing new land in the city of Vancouver. The only way to build is up, which means there's a high spillover into areas like Richmond. With Surrey and Burnaby still fighting the stigma of being seen as working class cities, Richmond's increasingly big money has helped it shed the tag of an immigrant town.
  11. FOOD! Lovers of fine food have a lot of munchie options in Richmond, from some of the best Chinese restaurants in the world to hip new modern eateries.
  12. LOW PETTY CRIME/HOMELESS RATES: While there's certainly crime and homelessness in Richmond, the numbers are far lower than elsewhere in Metro Vancouver, especially downtown.
  13. THE CANADA LINE: A new Skytrain line directly into the heart of Richmond has spearheaded much of the recent development in the city, giving commuters a way into downtown Vancouver in 25 minutes while residents of Coquitlam, Langley and Delta find themselves often fighting bottlenecked traffic.
  14. PARKS AND TRAILS: Walking the dyke is a regular go-to outdoor activity for Richmondites, but with Richmond Nature Park, Garry Point, and Terra Nova as places to go to get away from it all, it's easy to get intentionally lost in nature south of the airport.
  15. CLIMATE: While Richmond gets as cold as anywhere else in Metro Vancouver during the winter, it generally receives less snowfall, less rain, and much less smog than other parts of town, due to the jet stream coming directly off the water, rather than over the Lions.
  16. ABUNDANCE OF TEAR-ME-DOWNS: There are plenty of homes in Richmond that were built on the cheap in the last forty years, with no architectural appeal and large lots. These can usually be easily demolished and turned into townhomes or large modern family homes with little local protest, whereas similar development in Vancouver can be frought with bureacratic impediments.
  17. OLYMPIC EXPOSURE: Having Richmond shown to hundreds of millions of people around the world during the recent Winter Games has given the city no end of interest from companies and immigrants looking to move somewhere new.
  18. OPEN SPACE: Though much of it is listed under the ALR, Richmond has no shortage of open space that can be (and often is) turned into developed land. The infamous Fantasy Gardens was recently bulldozed to make way for a new development at Ironwood, which is one of Richmond's thriving new communities.
  19. AVAILABILITY OF PURCHASE OPTIONS: Recent development in Richmond has vastly increased the real estate inventory available to prospective buyers, with waterfront views and modern facilities being a big draw.
  20. COMMUNITY EVENTS: Weekend festivals such as the Ship To Shore tall ships event give locals a regular diet of things to do that cost little or no money. The annual Children's Festival, regular musical events and summer outdoor movies add to the fun.
Now keen observers will note this is only 20 reasons from a list that was supposed to provide 24.

Where are #'s 21, 22, 23, and 24?

Unfortunately if you follow the link above and click your way through the '24' reasons, you will discover that there are only 20 listed.

Presumably the last four are a take on the Location, Location, Location mantra.

In this case it would be... Gullible, Gullible, Gullible Gullible. Because that's the only way to describe the mindset that believes these factors off set the reality that is occurring in Richmond.


Email: village_whisperer@live.ca
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  1. Food security? Last I checked Delta, Surrey, Pitt Meadows, Langley were all part of Metro Vancouver and they are growing food there too.
    What a shameless pump piece from the Sun.

  2. ROFL loved this one:

    PLENTY OF DEVELOPMENT: Richmond's city council has a reputation for being developer-friendly, recently having allowed the construction of B.C.'s first wood-constructed six storey apartment building, which was consumed by fire before it could be completed.

  3. The Sun forgot to mention Richmond will be under water when the big one hits!

  4. It's not even 20 reasons - 3,5&11 are the same thing, ditto 9 & 20 and 4,7,16,18 & 19. I'm getting dizzy scrolling up and down here, but I think it boils down to about 5 or 6 actual reasons.

    1. Exactly... but the headline is "24 Reasons Richmond is Booming" and the majority who glance at the article will walk away with the subliminal message that real estate in Richmond is booming for a whole bunch of different reasons.

      Subtle manipulation at it's finest.

  5. Plenty of development is going on. reading everywhere richmond condo for sale, may be it would be good for many.

    1. Food security AND subsidized public transportation. What kind of libertarian paradise is this?