Wednesday, January 23, 2013

More on the $1 Condo for sale in Richmond and other realtor gimmicks

Yesterday we told you about a Richmond condo that had slashed it's asking price from $355,000 to $1.

Hoax?  Data entry error?

Adding to the mystery was the fact that various sites and realtors had updates with the 'new price'. Richmond realtor Arnold Shuchat  even commented on his blog about the listing.

Shuchat said:
I've just uploaded this listing for a condo at the Laguna in Richmond. And I always thought 1% Realty referred to some commission arrangement! This ranks as one of the largest price reductions ever: From $355,000 down to $1!
We asked if anyone knew what this was all about?

Was it an error? Or was it legit?

In case you missed it, Arnold Shuchat posted a reply to our comments section on that post.

(the post came minus the academic credentials after his name in his google blog signature. Does that mean we should stop referring to him as 'Alphabet Arnie' ?).

Shuchat tells us: 
Well, after getting a few calls on this one, I checked in with the listing realtor. It turns out the one of the owners is a Toronto based realtor and there has been a trend there to list properties for $1 to create some attention. They have no intention of selling for $1 but expect to have offers presented on Sunday night....etc. 
Based on a lot of negativity on some of these blogs, it would be an interesting wager as to whether a multiple offer scenario will materialize.

It will get sold because I think the owners will do what has to be done to sell it. 
I also predict a post-sale advertisement claiming "Sold $315,000 over asking price"!
We thank Arnie for the info and look forward to hearing from him with what the outcome on this little bit of realtor games is.

And Shuchat is right, you can almost see the press release sent out by the selling agent trumpeting just as Shuchat joking predicts: "Sold $315,000 over asking price!"

But let's face it, if it draws attention and the bids come in... it is a creative advertising gimmick to list the property for $1 and set a deadline to sell to the highest bidder.

And there's nothing wrong with that (providing they actually sell to the highest bidder).

Which is more than I can say for this next example.

As everyone is well aware, the federal government moved last year to eliminate the various ways banks had been helping home buyers skirt the 5% down payment requirement (ie. up to 7% cash-back offers).

We also know, all to well, that the biggest lament in the real estate industry right now is how significantly the new mortgage regulations have impacted entry-level buyers... effectively cutting the knees out from those looking to climb the 'property ladder.'

Check out the latest weasel manoeuvre to circumvent the new mortgage regulations.

(although I'm sure they would prefer the more politically correct analysis of 'creative accounting').

The latest ploy comes to us via this pamphlet for a Langley condo development.

The pamphlet outlines how first-time buyers can receive, from the provincial government, a $10,000 first-time home buyer grant.

Their suggestion (as you can see the the third picture above - click on image to enlarge): "Borrow the down payment from your favourite Uncle and pay him back when you get the $10,000."

The key to that $10,000 can be seen here:

With units starting at $179,900... the $10,000 would cover your 5% down payment to buy in this Langley development.

Nothing like watching some elements of the real estate industry actively encouraging home buyers to evade regulations eliminating those derisive 'zero-down' lending practices.

Who says we're all that different from the Americans?

(hat tip Tom)

Of course aren't liar loans, zero down, government R/E handouts and an industry that relentlessly pumps these options how we ended up at this apex where living in a van becomes a lifestyle choice?:

(hat tip GreenhornRET for video)

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  1. That's a real gamble in today's market. I'm betting that the bids won't be coming in close to expectations and the unit won't be sold. I'm guessing the highest offer will be in the mid 2's. Anyone else?

  2. Potential buyers will smell blood and lowball.

    1. Potential buyers should hold off, in my opinion only, just look at the stats and current news on those mags, I am trying to talk a good friend out of buying a house in Surrey, he says, 450k is not a lot of money and I say that it is way too much, should be 265 in a real market....


    The promoter made unauthorized use of the BC logo and is forced to destroy those remaining brochures.

  4. This comment has been removed by a blog administrator.

  5. Global news is pathetic. Where do people have to go to find actual news reporting? Sad.