You Too Can Lose an Infinite Percentage of your Investment in BC RE !!…

A B.C. developer wants to sell condos in Metro Vancouver’s red hot real estate market to first-time buyers without the cash for a down payment, but not everyone is sure it’s a good idea.
“It’s just a different spin on, ‘How do we provide an affordable home ownership option to buyers who otherwise can’t get into the market?'” says Townline vice-president of marketing Chris Colbeck.
The company is proposing buyers on limited incomes could be allowed to purchase a unit in its Port Moody development for eight percent less than the appraised market value.
The appraisal would be done by an independent third party, allowing the eight per cent to be used as a virtual down payment for a mortgage.
That would mean the bank would be financing 100 per cent of cost for the consumer, says Colbeck.
The idea has already been approved by B.C. Housing, says Colbeck, and Townline is hoping Canada Mortgage and Housing Corporation (CMHC) will approve the program as well.
“It’s a partnership we’ve made with B.C. Housing that’s providing us the ability to do this affordability program that hasn’t been done before. They’re the ones that have structured this program,” he says.

– from ‘Condos without down payments could be sold by B.C. developer’, CBC, 12 Jan 2016

8 responses to “You Too Can Lose an Infinite Percentage of your Investment in BC RE !!…

  1. ?????????
    Why would a developer sell for 8% below market value, unless they can’t actually sell for market value? The “independent” appraiser must be doing some creative appraising…

  2. No skin in the game. How could that end badly?

  3. Well, those 0% 40yr mortgage buyers have done ok to well so far, and CMHC chases after you for any losses it suffers, despite the fact that you are the one who paid the insurance premium! And I don’t think you can discharge the debt in BC through bankruptcy either.

    I agree with M—, why would a developer do this? Unless the guy is a secret Communist/Socialist in guise??

  4. aguywhosworried

    Locals can’t afford even a 1 or 2 bedroom condo but yet we have young kids barely out of high schools driving cars that are worth more than a condo.

    It seems real estate price is gonna jump another 30% this year! Sigh.

  5. In research we sometimes allow “deep discounts” like this to count as contributions, however it cannot be on appraised value or even market value — the depth of the discount is determined relative to the most preferred customer’s price, and that has to be supported by documentation and randomly audited. And of course the reason is that market or appraised value is too easy to inflate.

  6. I think people should be helped to own – like in Singapore – it gives them more of a stake in their community.
    You know, it’s strange that in this service economy, where so many live on tips (don’t feel bad about them – many are hitting $30./hour), that though you are required to declare all of this income, when you lose your job and apply for benefits, only your hourly wage is considered. Likewise, if you go to a bank (aka venal blood-sucking turds), that cash is vapour. You can’t get a mortgage. Solution – end tipping. Get real pay, pay real taxes, get real benefits. Get a mortgage. What’s with this tipping thing? Even the fat ladies on Commercial Drive where I buy sausage have a big piggy tip jar. They own the building and take two to three month vacations to Disney, or Cuba, or whatever takes their fancy. I’ve never been able to afford to take my kids to Disney. Why would I tip the fat ladies or their employees? They’re far wealthier than me. Let them pay their employees properly. There are big players in the hospitality industry who can well afford to take a stand against this bizarre practice. That would be worthy of respect.
    Regarding the plethora of supercars in Vancouver – just don’t kill anyone you assholes. And pay for all the ancillary services when you wrap yourselves around a pole. I remember reading how the son of the owner of the Army Navy store died crashing his Lamborghini – that it was a tragedy. It really would have been a tragedy had he killed someone. His death was poetic justice. Good riddance.

  7. For once I actually agree with the bears, this is a terrible practice. To buy a place you need to have a down payment. Don’t know who came up with this genius idea….

  8. rod_jonsson_pmd

    my father was a discounter, a discounter, a discounter
    my father was a discounter
    and this what he said
    buyer up! money down?
    oh no! cash gone?
    spent it on a big truck
    ok! try again!
    let’s see how to lever up!
    get some! from the feds!
    cmhc charity!
    what’s that? i don’t know!
    cad! sinking below seventy!

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