{"id":47,"date":"2016-03-30T21:05:39","date_gmt":"2016-03-31T01:05:39","guid":{"rendered":"http:\/\/www.dinani.ca\/blog\/?p=47"},"modified":"2016-03-30T21:05:39","modified_gmt":"2016-03-31T01:05:39","slug":"flipping-vancouver-homes-proves-profitable","status":"publish","type":"post","link":"http:\/\/www.dinani.ca\/blog\/2016\/03\/30\/flipping-vancouver-homes-proves-profitable\/","title":{"rendered":"Flipping Vancouver homes proves profitable"},"content":{"rendered":"
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About 20 per cent of detached homes in Vancouver sold in the last 17 months were re-sold within a year, with some speculators making hundreds of thousands of dollars in profits, according to a study by New Westminster\u2019s Landcor Data Corp.<\/span><\/div>\n<\/div>\n<\/div>\n

The report, published in Business In Vancouver, follows a plea from Vancouver Mayor Gregor Robertson to Premier Christy Clark to impose a \u201cluxury tax\u201d on property flippers as a way to curb \u201cunwarranted speculation\u201d that Robertson blames for Vancouver\u2019s housing affordability crisis.<\/span><\/p>\n

Earlier this month, the mayor asked Clark to consider new taxation measures to \u201cdiscourage the quick resale or flipping of new housing\u201d and collaborate with the city on measures to persuade the federal government to invest in public housing.<\/span><\/p>\n

Landcor identified 328 detached houses in Vancouver that were \u201cflipped\u201d (sold and then re-sold within a year) in the last 17 months, with the Dunbar neighbourhood showing the greatest activity.<\/span><\/p>\n

It said the typical price for a Dunbar home is about $2.27 million. About 30 such homes were flipped during 2014 and the first five months of this year.<\/span><\/p>\n

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House prices in Dunbar rose by 9.1 per cent during that period, according to Landcor, which means anyone who bought a home there a year ago and sold it this year could have made $200,000 on the transaction.<\/span><\/div>\n<\/div>\n<\/div>\n

However, Landcor found that some sellers appear to have done much better, with a home at 4086 West 30th Ave. being bought and sold within 217 days for $2.95 million resulting in a $400,000 profit.<\/span><\/p>\n

Other examples provided by Landcor showed investors netting profits of $340,000 to $300,000 on homes they held for less than six months.<\/span><\/p>\n

However, profit from house flipping is reduced by taxation as such transactions are subject to property transfer taxes, realtor commissions and capital gains tax.<\/span><\/p>\n

On a profit of $100,000 from a property flip, those charges could add up to more than $80,000, leaving a net profit of less than $20,000, said Business In Vancouver.<\/span><\/p>\n

Premier Clark has reacted cautiously to Robertson\u2019s request. She said whatever measures are taken must not hurt people who have bought homes and need their equity protected.<\/span><\/p>\n

Bob Rennie, one of the leading real estate marketers in Vancouver, and Darcy McLeod, president of the Real Estate Board of Greater Vancouver, said flipping has had no significant effect on housing affordability.<\/span><\/p>\n

\u201cHouse flipping is not what is driving the market and it\u2019s not significantly affecting housing prices,\u201d said McLeod.<\/span><\/p>\n

\u201cWhat\u2019s really driving prices is demand and supply. There is no more land available (in Vancouver) and the demand is for land. That\u2019s why we are seeing detached houses being a strong driver in the marketplace. Land is scarce and is becoming a luxury commodity, and not everyone is going to be able to afford their own little piece.\u201d<\/span><\/p>\n

Rennie argued in his annual address to the Urban Development Institute on May 25 that there was no way to solve the housing affordability crisis in Vancouver without increasing density.<\/span><\/p>\n

He said high housing prices were being blamed on foreign investors, \u201cwhich I don\u2019t think is accurate and it\u2019s something I will address in next year\u2019s speech.\u201d<\/span><\/p>\n

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Source:\u00a0The Vancouver Sun<\/a>\u00a0BY GERRY BELLETT\u00a0gbellett@vancouversun.com<\/a><\/p>\n

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About 20 per cent of detached homes in Vancouver sold in the last 17 months were re-sold within a year, with some speculators making hundreds of thousands of dollars in … [read more<\/a>]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[13],"tags":[],"_links":{"self":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts\/47"}],"collection":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/comments?post=47"}],"version-history":[{"count":1,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts\/47\/revisions"}],"predecessor-version":[{"id":48,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts\/47\/revisions\/48"}],"wp:attachment":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/media?parent=47"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/categories?post=47"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/tags?post=47"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}