Saturday, July 24, 2010

Sleight of Hand?

The Craigslist Ad is enticing, alright.

  • "This is it! An affordable opportunity to own in beautiful downtown Vancouver in Yaletown at way less than original purchase price."

Peaks your interest doesn't it? Especially since the condo market appears to be softening up in the Village on the Edge of the Rainforest.

More from the Craigslist ad:

  • "Suite #1405 at the "Beasley" (named after former city planner, Larry Beasley)is the highly sought after "E" plan and originally sold for $547,900. We are offering it for sale at an incredible price of $459,000 (assignment of contract). The "E" plan is one of the very few plans in all of Vancouver that are a corner suite taking advantage of the natural light. It includes a stone granite kitchen island that opens up to the spacious living and dining room area, heated tile bathroom floors, Stainless Steel Kitchen Aid appliances and engineered hardwood floors. Not only does it have a den but also an extra flex space thereby smartly utilizing its spacious 678 square feet. The added amenities include a fully equipped fitness centre, meeting and library rooms and not to mention the unique 8th floor, 60 foot out door dog run area. The building is currently under construction from reputable local developer, Amacon who is responsible for building many beautiful properties within the city for the last 40 plus years such as the "Brava", the "501" and the "Melville" to name a few. Completion date is set is on target for a November 2011 completion... I was also one of the original sale people on this development. I look forward to hearing from you."


So one of the original sales people is (apparently) cutting his losses and is willing to offer you one of the suites that he had secured for himself (presumably to flip), cutting the price from an initial $547,900 to $459,000: a loss for him of $88,000 (about 16%).

Or is it?

Keen local market watchers may recall an initiative launched by Amacon Development in 2009 called the 'pass it on' campaign. MAC Marketing Solutions trumpeted this campaign and rolled out the first version with the stalled Yaletown condo development 'The Beasley'.

In this campaign, Amacon offered reductions on the prices of their condos ranging, on average, from $100,000 - $250,000 off the initial purchase price. And these 'savings' were even extended to those who had already signed pre-sale agreements to purchase at the higher 'initial purchase price'.

It means no one ever actually bought a Beasley unit at the 'original purchase price'.

In all likelihood our Craiglist sales person paid, at best $447,900 for his Beasley condo. As a salesman associated with the project, he no doubt paid less than that.

Caveat Emptor, as they say, because these condos at the Beasley have already seen 'cuts' from their initial purchase price of at least 22%.

So it this a deal in a downturning market to offer the unit at $88,000 off the 'original purchase price' when the units actually sold at a minimum of $100,000 off that original price?

You decide.



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1 comment:

  1. And here is the video: