LANDCOR Online Real Estate Analysis
Total Page:16
File Type:pdf, Size:1020Kb
LANDCOR Online Real Estate Analysis August 3, 2007 Chair Stephen Quinn Thompson-Nicola Regional District 300 465 Victoria St Kamloops BC V2C 2A9 Dear Chair Quinn, R~: A_f!0rdability o! Vacatiol1 Properties in BC in 2006 Please find enclosed a complimentary Market Analysis report outlining the Affordability of Vacation Property in Lake Regions of British Columbia. This report analyzes the market changes over the last 10years to highlight the areas of extreme market fluctuation as relating to average price change. The significant items of interest are: • Kootenays waterfront average price increased over 250% from 1996-2006. • Lake Country (Okanagan) average waterfront price over $1,250,000in 2006. • 5.6% of Lake Area properties purchased by Calgarians. Our rich data access, direct market experience and statistical capabilities position Landcor™ as the leading resource for British Columbia real estate analysis. We've served this market for more than 20 years, and are now the premier provider of real estate information in the province. Landcor will be publishing several high-value reports this quarter dealing with: foreign ownership, market statistics, assessed values, sales history and market trends. As a premier market/media player in our business segment I wish to offer you these reports on a complimentar basis, to receive the next three reports in this series or to discuss this report please call e t (604)606-791 or email [email protected] for further information. Upcoming Reports: o Whistler Watch o Gulf Islands Rudy Nielsen RI (Be), FRI President Landcor Data Corporation Landcor Data Corporation BofD #200 - 313 Sixth St, New Westminster British Columbia, Canada V3L 3A7 Agenda - ~ 0·, I~/07 Tel: (604) 606-7914 Fax: (604) 606-7901 . :0 [email protected] W'N'N.landcor.com If',\\) Landcor™ Data Vacation Property Corporation Affordability of Lake Regions in BC Preparation Date: May 10th, 2007 Landcor™ Data Corporation L- .. ~ EXECUTIVE SUMMARY Introduction Landcor™ (est. 1988), a wholly owned subsidiary of the NIHO Group of Companies, has been a leader in the real estate analysis market in British Columbia for more than 20 years, and is now the premier provider of real estate information in the province. Landcor™ was built with the assistance of professors from UBC as well as in-house real estate expertise. Purpose of the Re.<_p_o_rt _ The purpose of this report is to give you a detailed overview of property sales values in the province of British Columbia for vacation properties, particularly those in the regions that contain lakes and/or lakefront property. The market for recreational/vacation properties in BC has grown substantially since 1996, as evidenced by the huge increases in property value, therefore affecting affordability for the average family greatly. Waterfront property, in particular, surpassed all other properties in average value increase from 1996-2006. In some areas, such as the Kootenays and the Okanagan, waterfront properties have increased 250% and 150% respectively. Quotes ------------ The current Supply and Demand for lake property in BC will be generating innovation in the production of this product. Condos and Apartments with lake access or water views will be a hot product for the majority of buyers while access to properties with significant waterfront land area will become an extremely precious commodity. Developers will vie with Hollywood celebrity and other elite buyers for access to this land and for very different purposes. Rudy Nielsen, President, Landcor Data Corporation Copyright © 2007 Landcor™ Data Corporation Pagei Landcor™ Data Corporation TABLE OF CONTENTS I. BRITISH COLUMBIA VACAnON PROPERTY SALES AVERAGE PRICE VALUES 4 Waterfront VS. Non-Waterfront 5 II. REGIONAL PRICE CHANGES 7 Vancou ver Island 8 Okanagan 10 Kootenays 12 BC Northern and Northwest 14 III. WHO IS BUYING VACAnON PROPERTIES? 16 IV. CONCLUSION 18 V. LANDCORT~ DATA CORPORATION 19 VI. APPENDIX A: AREAS OF INTEREST _ AVERAGE PRICE CHANGES 23 Copyright © 2007 Landcor™ Data Corporation Page ii Landcor™ Data Corporation DISCLAIMER Landcor™ Data Corporation provides this report only as a courtesy, for general information purposes. Because the data in this report is provided to Landcor™ by the British Columbia Government and its various agencies, Landcor™ has no control over the accuracy of that data. Further, that data is based on information available as of a particular moment in time. THE INFORMATION IN THIS DOCUMENT (the "CONTENT") IS THEREFORE PROVIDED "AS IS" AND "AS AVAILABLE". THE CONTENT IS PROVIDED WITHOUT WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NONINFRINGEMENT. UNDER NO CIRCUMSTANCES SHALL LANDCORTM DATA CORPORATION ("LANDCOR"), ITS SUBSIDIARIES, OR ITS LICENSORS BE LIABLE FOR ANY DIRECT, INDIRECT, PUNITIVE, INCIDENTAL, SPECIAL, OR CONSEQUENTIAL DAMAGES THAT RESULT FROM THE USE OF THE CONTENT. THIS LIMITATION APPLIES WHETHER THE ALLEGED LIABILITY IS BASED ON CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY, OR ANY OTHER BASIS, EVEN IF LANDCORTM HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE. BECAUSE SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR LIMITATION OF INCIDENTAL OR CONSEQUENTIAL DAMAGES, LANDCOR'S LIABILITY IN SUCH JURISDICTIONS SHALL BE LIMITED TO THE EXTENT PERMITTED BY LAW. Copyright © 2007 Landcor™ Data Corporation Pageiii Landcor™ Data Corporation I. BRITISH COLUMBIA VACATION PROPERTY SALES AVERAGE PRICE VALUES The following numbers include only valid sales; that is, rejected sales are not included. Rejected sales are sales that have a sale price that is not based on true market value, including sales between family members, distress sales (typically resulting from a bankruptcy foreclosure), etc, sale of a partial interest, etc. Note: All sales figures for 1996 and 2006. All comparisons between 1996 figures and 2006 figures are direct comparisons; that is, comparisons between 2006 and 2007 are between • Sales from January 1'I, 1996 to December 1", 1996 versus • Sales from January 1'" 2006 to December 1", 2006 I Average Sale Average Sale REGION WATERFRONT Price (2006) Price (1996) Increase/Decrease I Vancouver Island YES $577,531 $10642 7, 166 0Yo NO I $322,015 I $159,411 102% Okanagan YES $485,138 $190,902 154% NO $271. 923 $124,755 118% Kootenay YES $440,706 $124,321 254% NO $265.160 $86,278 207% BC Northern & YES $150,372 $106,162 42% Northwest NO $110,441 $68,892 60% Figure 1: Average Price Change comparison by Waterfront Flag and Region for areas that contain lakes As evidenced by Figure 1, all properties in lake areas increased in value by a substantial margin from 1996 to 2006. The largest increases occurred on waterfront properties as compared to non-waterfront properties within the same region. The largest difference occurred on Vancouver Island, where the discrepancy was over 60%. The Kootenay region had the largest increase in property value, with a 254% and 207% increase in Waterfront and non-waterfront property respectively. Copyright © 2007 Landcor™ Data Corporation Page 4 Landcor™ Data Corporation Waterfront V5. Non-Waterfront - REGION Pri~e Difference Price Difference Increase/Decrease I 2006 1996 Vancouver Island $255,516 $57,653 $197,863 Okanagan $213,215 $66,147 $147,068 Kootenay $175,546 $38,043 $137,503 BC Northern & $39,931 $37,270 $2,661 Northwest Figure 2: Difference in Average Price between Waterfront and Non-Waterfront The price gap between waterfront and non-waterfront properties has increased greatly from 1996 to 2006 in lake areas throughout BC, except for the BC Northern and Northwest, where the gap has only increased slightly. The premium paid for waterfront property continues to rise as purchasers are willing to pay more for the waterfront prestige and access to fresh water for recreational activities. Copyright © 2007 Landcor™ Data Corporation Page 5 LandcorH' Data Corporation Is Water Front Property $350.000 [] Water Front Property iii Non-Water Front Property S300.000 ~ .~u ~ $250.000 ~ '"~ ~•• ~ :< $200.000 $150.000 $100.000 1996 1997 1998 1999 200() 2001 2002 2003 2004 2005 2006 Sale Year Figure 3: Difference in Average Price between Waterfront and Non-Waterfront 1996-2006 The average price of Waterfront properties in lake areas doubled from 1996-2006, reaching an average price of $310,000, which non-waterfront properties in the same areas has also doubled, reaching an average price of $240,000. Copyright © 2007 Landcor™ Data Corporation Page 6 Landcor™ Data Corporation II. REGIONAL PRICE CHANGES Each region in British Columbia has unique circumstances that affect property value and purchasing decisions of prospective buyers, such as climate, population and access, but the most value affecting variable is distance to a major city, such as Vancouver, Victoria, Calgary and Edmonton. Properties that are closer to a major city, within a 4 hour drive- time specifically are generally more valuable than those that are farther away. Following, we have included some regional examples of price trends for waterfront and non-waterfront properties within areas that contain lakefront property. Of particular interest are the high-value areas in the following table: Jurisdiction Average I Price Lake Country $1,278,868 Invermere $1,222,500 Gulf Islands Rural $650,048 North Cowichan $636,250 Alberni Rural $582,343 Oliver $559,541 Penticton Rural $548,687 Grand Forks Rural $456,385 Salmon Arm Rural $418,195 Invermere Rural $364,300 Figure 4: Highest Average Prices for Lake Areas Copyright © 2007 Landcor™ Data Corporation Page 7 LandcorT" Data Corporation Vancouver Island REGION: Vancouver Island Is Water Front Property $600,000 19 Water Front Property ii Non~Water Front Property $500,000 1j $400,000 .;: ~"- " '"•.•$300,000 •..•• ••• <> $200,000 $100,000 $0 N N N N N N N -<> -<> -<> -<> a a a a a a a -<> -<> -<> -<> a a a a a a a 0- ...., 00 -<> a N w V> 0- Sale Year """ Figure 5: Average Price on Vancouver Island by WaterfrontlNon-Waterfront flag Vancouver Island contains many areas with lakefront property, some even on their own small island, such as Pender Island and Saltspring.