Spot The Speculators #74 – “My husband and I live in Richmond and have 6 children. Late last year we bought a rancher and renovated it, hoping to sell it as an investment. We are willing to sell far below market value…”

“I opened a copy of the [17 Feb 2012] ‘Delta Optimist’ today and ended up in the RE section [pA25], where I saw a big *half-page* ad that read thusly:

“My name is Ingrid – my husband and I live in Richmond and have 6 children. Late last year we bought a rancher in Boundary Bay from a lovely lady who moved to Vancouver Island.
Here’s our dilemma: We completely renovated this cozy rancher hoping to sell it as an investment. Now that it hasn’t sold, we are carrying more than one mortgage and would like to remain in Richmond. We are willing to sell far below market value because a similar renovated rancher sold for $949,000 on the same street and we are willing to sell for $729,000.
Our realtor will be holding an open house this Sunday at 2pm sharp. If you have any questions, please call…”

Now, this could be typical realtor bullshit, but I’d rather think it’s more anecdotal evidence that 1) People are taking on WAAAAAY more than they can handle because they’re told BPOE RE always goes up in value, and 2) This bloated pig is exploding…”

– posted by ‘gordholio’ at VCI 3 Mar 2012 10:10pm

Thanks Gord.
Real brazenly obvious speculators, so the ‘spotting’ isn’t that difficult, or that much fun, in this case.
“Below Market Value” sales always make us laugh. Whatever this sells for is, of course, the market value.
– vreaa

23 responses to “Spot The Speculators #74 – “My husband and I live in Richmond and have 6 children. Late last year we bought a rancher and renovated it, hoping to sell it as an investment. We are willing to sell far below market value…”

  1. I am almost inclined to view this as realtor BS.

    In the slim chance that it isn’t, Ingrid may be on to a ‘sell’ methodology. These heart string ads do standout!

    Being beaten senseless by all the sky high Vancouver prices, this rancher, although barebones, seems like a steal 😉

  2. It’s bs. It could still fetch $900k

    • So they are hoping to attract multiple bids in other words and push the price back up. Seems reasonable enough. It will probably work too depending on the neighborhood pricing.

      There are always enough fools who will buy all the way down to the bottom. Especially if your ad gimmick is slick and there seems to be a genuinely good sale price tendered. Like this home.

    • Nearly a million for a Boundary Bay rancher! That’s bloody hilarious. I pity the poor fool who blows his/her brains out on buying that!

  3. savvy marketing. On the surface it looks like a distress sale – which bargain hunters love. Actually, Ingrid bought this place last Oct/11 for 565K. It has current assessed value of 694K. The only one buying this home far below market value was her…last October. Even with a 50K renovation they stand to make $100,000

    • Nice. Thanks for the good comment.

    • F1, thanks for your contribution. Often I don’t agree with your point of view, although it is nice to see diverse opinions in the comments.

      But when you provide hard data, it is much appreciated. (I’ll give you the benefit of the doubt and assume your data is correct.)

    • I doubt this person is going to be submitting 50% of their profits to CRA since this home is an investment property AND owned for less than 1yr.
      Who else is tired of the tax evasion in this country?

      • @ formula1: “I doubt this person is going to be submitting 50% of their profits to CRA since this home is an investment property AND owned for less than 1yr.”

        Nor should they – capital gains tax is only paid on 50% of the actual gain, and only then at the investor’s marginal rate. They would probably be looking at no more than ~22% tax (45% tax rate on 50% of the gain).

        But I agree – certainly tax evasion on property sales runs rampant.

  4. Based on the listing – some interesting info.
    Owner is “Novo Pacific (2010) Developments Ltd”. Sounds like a professional spec / reno / flip. Don’t give us this “We have 6 kids” Emotional B.S. – Is this really relevant? This is a business transaction. However – digging a little further – it appears like a true amateur speculator. Bought it in October for $560K. Did some quick reno (hopefully fixed the roof as the old listing says it needed it). However- the owner is very modestly employed and this was probably funded with equity from their home in Richmond (which is worth about the same as this one). Seemed like a guaranteed winner when they started. At 60 days on market, tought to imagine the reno was really extensive. After all this – we’ll see how it goes but you have to imagine they were coached into this and may well regret it in the end.

    Have to bet they are squeezed for cash flow and won’t ride out a 6 month selling process.

    • Schadenfreude is great. I love stories of naive flippers getting burned.

      • Yes. Let them choke on their greed. Speculators are half the equation for why prices have been driven so high, so fast. Isn’t everyone sick of hearing their war stories of making easy killings in the big real estate jungle by now anyway. I like the ad actually. It sells desperate.

      • 4SlicesofCheese

        That is cold Jeff…. they got (six) kids to feed!

      • Thats the problem these days, people having kids, cant afford it and then expects everyone else to take pity on them…stop using ur brain down there…

      • Another thought I had – they bought this in October 2011. Using a company name with 2010 in the name sounds like they did a successful flip the year before and now are seeing it was not so easy.

      • This flipper hasn’t gotten burned at all yet. If F1 is right, they could drop the price another 100K and still not come out too bad. They might be acting desperate but they have a lot of room to give before they are actually in the red.

  5. Hopefully someone can post the final sale price here when and if it does happen …

  6. By the way….does anyone know if the home in question sold? The open house was held over two weeks ago on February 17th. If it was such a hot deal I can only assume it is already off the market.

  7. no it did not sell. Another open house this past weekend.

    http://www.realtor.ca/propertyDetails.aspx?propertyId=11454300&PidKey=2139325157

    MLS #V924464

  8. Oh shit, this is a big problem. The home remains listed low where others sell nearer a million? Tough break, maybe the buyers really are going on strike and have gathered their senses before it was too late. Twenty five year Ams will finish it off for the season too should Mr Flaherty bring them down. Many thanks for the link Pennysaver.

  9. The ad forgot to mention that the area is a flood plain – if you remember a few years ago the area was flooded by heavy rains. Wonder if that is why the “renos” were done?

    • Exactly! Talk to any property insurance person and you’ll find out that some parts of South Delta will not be fully insurable. I guess nobody ready the study of what will happen to Boundary Bay when sea levels rise by just 1 metre.

    • @sea level rise:+2m, it is cut off from the rest of Tsawwassen
      @ +6m, it is “swim or sink”
      http://flood.firetree.net/?ll=49.1682,-122.9123&z=6&m=4

      46, 67th Street
      MLS#:V924464
      A/P: $729K
      Property Assessment Value: $694k
      rancher – Sq Ft: 1182
      Lot: 5,508 sqft
      Built: 1978

      1505, 53A Street
      MLS®: V927226
      A/P: $768k
      Property Assessment Value: $670k
      2-storey SFHr – Sq Ft: 2426
      Lot: 9,870 sq.ft
      Built in: 1967

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