About a year ago 89 condos went on the market in the Texada development in North Nanaimo. As of today, only 25 have sold which means that 64 are still left on the market. In normal times all of them would be sold by now. Being stuck with all of these condos is a real burden for the developers. Since people are living in some of these condos, a strata is formed and they must pay 64 strata payments each month. They also must pay property taxes to the city. Let's assume that the average strata fee is $200 and property taxes are $125/month. That is $325x64 which is about $21000. Over a year period (being generous cause some have sold) that equates to $250000. If they are also borrowing money from the bank to finance the projects, they are taking a hit on that. Recently they reduced prices on all the condos by ~10% so we will see if sales start to pick up.
In April only 11 condos sold out of 188 on the market (It appears the Texada ones got delisted end of month so really there are about 250+). Clearly this is a bigtime crash.
http://www.relocationbc.com/statistics-vanisland.asp
How are sales of those condos going now? With decreasing interest rates first time buyers appear to be initiating more new mortgages lately to give the market a bit of a bounce. I don't expect it will last.
ReplyDeleteThanks
Kicker
When condo ownership costs about the same -or a bit more- as renting the place, you'll see sales.
ReplyDeleteIn Nanaimo-in this dubious economy,the high dollar 'luxe units will just continue to sit...I predict some developer auctions towards the end of summer/fall-and probably the first few developers to go that route will do not too badly. Thats been the history in larger centers in previous RE busts.
Thanks for sharing the links. Will gonna check this out.
ReplyDeletePaula M
Not too surprising...seemed like Nanaimo got flooded with new buildings in 2008, and well, we all know what happened in the fall of that year.
ReplyDeleteI check the link you have shared and it shares: The page cannot be found.
ReplyDeletemakati condominiums
As my regular readers know, I've spent much of this year contemplating big themes, like the long-term picture for energy, energy and monetary policy, black swans and the human penchant for valuing the present more than the future, the problems of complex systems like the energy-food-water nexus, sustainability, and the relationship between climate change and peak oil.
ReplyDeleteflat rent jesmond
Yeah its not surprising then,you should be able to compete wit the the new buildings and or condos that rise up nowadays.
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seattle area
I agree to you arrielle_p I check the link and the page cannot be found. What happen? Anyways thank you for sharing.
ReplyDeleteCharles A