Monday, January 27, 2014

Kelowna's Big White feeling the real estate pain?

Seems Kelowna's Big White ski community is feeling the real estate pain.  A quick search of some online listings show there's red ink galore on the slopes.

Above is 200 Moonshine Crescent, Unit #12. Advertised as an "outstanding value" the listing says:
OUTSTANDING VALUE for Stand Alone Deluxe cabin priced $120,000 less than current owner's original purchase price! Features 1347 sq ft, largest of all the 2 bedroom cabins, 2.5 baths, sleeps six. Nestled amongst the trees of White Forest Estates.
$120,000 loss? Ouch.

There's this 'opportunity' where we are told:
"Developer of the prominent and very successful “SUNDANCE AT BIG WHITE SKI RESORT” says “SELL the REMAINDER of the LAND allowing another Developer to LIVE THE DREAM!”

Hmmm… more like share the loss.

How about this one (click on all images to enlarge):

"JUST REDUCED $140,000" screams the copy and now selling for $259,900? Ouch again.

Other real estate advertisements trumpet that Condos being sold in receiver liquidations are going for 60% off original launch price:

According to this article titled, B.C. ski resorts a “buyer’s market”: Reductions of 50 to 60 per cent from peak may stir flat ski-condo sales, the carnage is everywhere.
A buyer's market will greet potential buyers of ski condominiums at B.C.'s finest winter resorts this winter, with prices off as much as 60 per cent from the peak of four or five seasons ago.

"It's a buyer's market all right," said Bill Hanrahan, a real estate agent with Sun Peaks Real Estate near Kamloops. Real estate prices at the popular ski hill have been declining since 2008, Hanrahan said. As for sales, "We have been bouncing along the bottom for six to eight months."

As an example, he points to a selection of two-bedroom, two-bath Sun Mountain Villas that sold recently for from $230,000 to $247,000, with one recent listing at $195,000. Those prices would have started at $335,000 during the fat years before an international monetary crisis flattened ski-mountain sales. Some Sun Peak hotel-condos, which restrict usage by the owners and normally are pooled into rentals, have sold for as low as $20,000 this year.

At Big White ski resort near Kelowna, the remaining inventory at the super-deluxe Edge development - built in 2009 and now in receivership - has seen prices reduced 60 per cent. An example is a three-bedroom, 2,000-square-foot duplex in the complex that had $399,000 knocked off the property, which is now listed at $599,000. This pencils out to less than $300 per square foot, which would have once been considered a screaming deal for such high-end recreational property.

That price would be welcomed at Red Mountain near Rossland in the Kootenays, said Red's vice-president of sales and marketing Jim Green, who notes that most of the 15 ski condos for sale are listed from $225 per square foot. 
A three-bedroom luxury suite at Red bought in 2004 for $450,000 is now on the market at $275,000. 
Green points to even bigger price discounts: a 1,600-square-foot suite valued at $700,000 is now at $359,000 and has been on the market for at least six months; and ski-in, ski-out townhouses are listed at $270,000, or about half the original price
One local realtor described the general Kelowna market this way:
Although inventory levels dropped, (as many frustrated sellers took their homes off the market due to a lack of success) we still remain at levels that are over 20% higher than the average of the last 13 years. Sales rose due mainly to some sellers finally coming to grips with the prices that the buyers were able to qualify to pay.
But positive enthusiasm is the mantra of this business. Check out the 2014 market outlook from these two who could obviously be up to their armpits in manure and would still keenly enthuse, "Gee, there must be a pony around here." 


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  1. I grew up on Big White.. that was 15 years ago, and I hadnt been back until two years back.

    To say the change was astonishing is an understatement. It was so obviously, absolutely, without a doubt out of line with what is reasonable for a town the size of Kelowna... that I was gobsmacked.

    Someone got seriously out of control with Alberta money I suspect. I very much pity anyone who makes a wage who bought in at any time during the boom.

    Pair that up with whats about to happen in the tar fields... and it spells: Prices at Big White have a very long way to fall.

    I mean, seriously, it is stupid to see what they have done up there.

    1. Tar fields? Really? Whatever credibility you might have enjoyed just went out the window and into the "environment" you worship.

    2. Albertan! Phhffhuhh

  2. Wow. That is about all I can add. The big question I have is this......who are these people that are attempting to list and sell at 60% off the prices they originally paid?

    It is inccredible they could have made such a big mistake when all the R/E blogs in the vicinity of North America were screaming "stay away" as loud as they could for the past several years.

    Apparently, nobody wth money and brains was actaully listening and so now they are cooling their gonads with very heavy theoretical losses. Of course it could still get worse. They have not yet sold.......60% off is now just a starting point in the negotiations.

    Idiots. They don't read blogs.

    1. One word: TAIPAN

    2. And then came the boxers and kicked all the foreigners out. Hmmm?

  3. Those that say real-estate prices won't decline meaingfully in Canada, let alone BC should read this article a few times and begin to internalize.
    Prices will revert to mean and it will be painful. Prices may well over shoot, and it will take years to do so. Even small YoY adjustments compound over time, even with single digit drops each year.

    As commentary, just love how the realtor in the article calls it "bouncing along the bottom", as if that can be determined at a point in time. In reality, the bottom won't be known until a future point when the benefit of being able to look back at price history shows where the bottom was.

    Recreational property is the canary in the coal mine. In my mind, first to drop and will keep dropping the longest.


  4. "2014 forecast " ...what a bunch of "RE professionals". Who takes this junk seriously now days ? Really ?

  5. Brains and money some times do not mix...

  6. Whistler ppty mkt is dead now too.

  7. The Kriegs are Klowns.

  8. Was at the mall yesterday and picked up a copy of Ming Pao (Chinese newspaper). The A-section, which consists of 24 pages, has 9 full-page RE ads, 2 quarter-page RE ads, 1 half-page luxury car ad, 1 full-page luxury timepiece ad - all with the theme of "buy now! Chinese New Year special!" Looks like the marketing machine to go after HAM is still full steam ahead...

    1. At least this bust is good for newspaper revenues when fully half the pages are paid promotions or advertising. Starts to smell like desperation. I always said a China contraction would spell the end of the glory days in BC. Looks like we might be getting their bit by bit. An epic screw up is when you don't know where the money is flowing in from and don't care. That whole poppycock theory that all housing was just switching hands between locals will be proven wrong eventually. It did never explain all the empty condos in Coal Harbour just for starters.

    2. The Chinese don't buy recreational ski property.
      Aussies like me do. The English and the Americans are also purchasers.

  9. We need a new blog posting, stat!