This house at 3095 Plymouth Dr. sold for half the $1,495,000 asking price.Taehoon Kim/The Globe and Mail
The sale of a house in North Vancouver, B.C., late last year made it the envy of bargain hunters. The buyers made an extremely lowball offer and scored a real estate win.
The house at 3095 Plymouth Dr. sold for $750,000 – half the $1,495,000 asking price and nearly $1-million below the assessed value of $1,724,600. Realtors and anyone paying attention were shocked at the sale.
“This is the craziest thing I’ve ever seen,” said realtor Patricia Houlihan, who’s been in the business for 21 years.
“I have many buyers who’d have bought it sight unseen for that price,” said realtor Fred Trudeau.
The property spent 106 days without any recorded price reductions before selling on Dec. 24 for $750,000 and closing in January. The buyers who snapped up the 70-year-old teardown now own a large 7,642-square-foot lot, about double the width of the standard 33-foot Vancouver lot. The home sits on a curved road with a forested backdrop, between large houses in the Windsor Park neighbourhood, where the benchmark MLS price for a detached home is $1.89-million.
The land was assessed at $1,668,000.
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Listing agent John Buchanan, of Royal LePage Sussex, declined an interview, as did the buyer’s agent, Dylan McCansh of Oakwyn Realty, citing the buyers’ request for privacy. Royal LePage managing broker Lawrence Putnam, who lives a block away from the property, said he couldn’t divulge details because of industry privacy rules, but he said the house, located not far from a busy road, could not be lived in in its current condition.
“I do think somebody got a pretty good deal there, but we’re in a market … where there are not a lot of builders buying right now,” said Mr. Putnam.
He called the sale an outlier, and said it won’t impact other properties in the area.
“It was a sale price, certainly, that provoked a lot of discussion. But the value of any of that discussion would have to be measured against somebody’s knowledge of and understanding of that particular property. I’m not sure how many people have gone inside it and seen its condition, but I would suggest they have a relatively limited value to their opinion if they hadn’t.”
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The neighbourhood is filled with houses built on large lots, and is a draw for families. A house at 2996 Plymouth Dr. sold last September for $2,025,000, or $327,000 above assessed value. A house at 2984 Plymouth Dr. sold last October for $1,650,000, or $37,400 above assessed value.
Ms. Houlihan couldn’t comment further or speculate about the sale. But generally, she tells her clients to drop the price gradually, because each price point brings in potential new buyers. The current market is especially tricky terrain for finding the right selling price.
“You don’t really know what something’s going to sell for. Places that are good deals – the buyers don’t know they’re good deals. It’s the lemming factor that’s killing me,” she added. “When prices are way too high, everyone wants to buy. But when things are selling low, everyone is like, ‘What if it goes lower?’ Once it starts going back up, it’s too late.”
Vancouver realtor Lorne Goldman agreed that sales like 3095 Plymouth Dr. are outliers. Deals are out there, but they’re not that extreme, he said.
“None of our buyers have seen that level of reduction in price. It’s highly unusual,” he said.
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“Granted, the market is not maybe doing great. But are there huge bargains out there in this market because of that? My answer to that is, ‘No.’ I mean, I’m always being asked every day by buyers and agents, ‘Will my clients take a low offer?’ You don’t even talk to them. It’s a huge time waste for me.”
But there have been other surprises. In particular, high-end properties and fixer-uppers are taking a harsh reality check. A large, roughly 4,000-square-foot, 14-year-old house at 1562 West 40th Ave. sold for $2.28-million below the asking price after 530 days on the market. The five-bedroom, seven-bathroom house has a roof with copper features, a wok kitchen and media room. The Shaughnessy home had been assessed for $6,138,000, with land value at $3,831,000. The house sold for close to land value, at $3.5-million. Listing agent Wei Du had received several offers, but declined an interview.
Mr. Goldman said that property had its challenges. It was designed for a wealthy Asian buyer who is no longer active, and it also backs onto a car repair shop. He believes the relatively new house will get redeveloped. City policies are pushing for more density in low-density neighbourhoods.
“It’s really ironic that in this age of environmentalism we were busy ripping down houses and building houses that we’re going to rip down 15 years later.”
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In Strathcona, a house at 655 E. Pender St. sold for $980,000 on June 2. It had been assessed at $1,377,200, with the land portion valued at $1,307,000. The character house, which needed significant repair, had been listed in the spring at $999,000.
Listing agent Fred Trudeau said after nearly a month on the market, and showings to about 20 people, the seller received the one offer. His seller wanted to get close to $1-million. Mr. Trudeau said the property needed work, it was tenanted, and it was on a smaller lot than average. All those factors affected the price. He sympathizes with sellers who are having to adjust their expectations.
“BC Assessment doesn’t go door to door, but buyers do,” he said of the assessed value, which is about 28 per cent higher than the sale price.
“I think people’s disposable income has been decimated and they don’t have a big appetite for risk,” he added.
Many agents will advise their clients not to go in with an insultingly low offer. Although sellers might balk at a lowball offer, buyers can try. And sellers can accept any offer they like, says Mark Moldowan, spokesman for Greater Vancouver Realtors.
“We don’t set any price or value to a home as an organization,” he said in an e-mail. “That is determined by the seller. A Realtor may recommend a sale price based on their experience, but the seller ultimately is the one who sets the price and agrees to a sale.”
He added that assessed values are one year old and not based on current market value.