April 3, 2020

COVID-19 will take time to be felt in Metro Vancouver real estate market

Health crisis threatens to bite highly leveraged mom-and-pop investors, experts say

Sutton West Coast Realty broker David Hutchinson is one of many local property brokers who expect Metro Vancouver home sales to start falling | Rob Kruyt

Real estate brokers, analysts and investors are bracing for the impact of the COVID-19 pandemic, and what could be a rough ride for residential real estate in Metro Vancouver throughout the rest of 2020.

While overall sales in March were up 46.1% compared with March 2019, that apparent strong performance needs to be put in context. March 2019 was an extraordinarily bad month for home sales as it had the lowest total number of home sales during March since 1986 and was 46.3% below the previous 10-year March sales average.

Insiders also point out that there is a lag in recording sales. Most home sales take several weeks to close, meaning that a good chunk of the March sales would have been agreed to before mid-March, when governments started incrementally instituting restrictions on travel, entertainment and social gatherings.

The consensus is that the first reliable litmus test for the strength of home sales will be in be in April, and everyone Business in Vancouver spoke with said that home sales will fall as a result of fewer people looking at homes during the early weeks of being ordered to distance themselves from others.

This is despite the Bank of Canada cutting its benchmark interest rate to a record low 0.25%.

Some buyers may aim to get out of purchase agreements signed in February and March, but Sutton Group West Coast Realty broker David Hutchinson told BIV that courts are unlikely to be accommodating.

B.C. has no force majeure provision in its sales agreements, meaning that buyers cannot argue that unforeseen circumstances related to the pandemic merit cancelling the contract.

“The deposit will be in the respective realtor’s trust account,” he said. “It’s security for the purchase. If they don’t follow through, the deposit would go to the seller.”

That seller, he added, may also take the buyer to court for breaking the contract and sue for any difference in price if the home is later sold for less than the originally agreed sale price.

Hutchinson said that the number of home-sale transactions will fall in part because unemployment has spiked and banks tend not to provide mortgages to people who are not working.

“You might have a very motivated buyer, but they’ll have no purchasing power,” he said.

Real estate agent, analyst and blogger Steve Saretsky agreed. He suggested that many mortgages provided in recent months were likely to people now unemployed and struggling to keep their heads above water.

“Foreclosures will move higher, for sure,” he said. “It’s a bit of a mess, but I don’t think we’ll see a lot of this filter into the market for another three to six months.”

An additional challenge for those aiming to sell their homes is that mom-and-pop investors who have investment properties might be forced to put those units on the market, Saretsky said.

City of Vancouver bylaws forbid anyone from putting a secondary home on short-term rental websites, but Saretsky believes many people have evaded these restrictions. Those previously Airbnb-listed homes would then compete with other properties for buyers or renters, potentially driving prices down.

“Vancouver has been a really good real estate market for 20-some-odd years, and people were extrapolating recent performance and were obviously more OK with negative cash flow in condos.”

Saretsky added that owners who had been relying on their second home to increase in value and were willing to pay strata fees, taxes and mortgage payments that left them cash-flow negative are likely to reassess their investment.

Their predicament is why Real Estate Investment Network senior adviser Don Campbell has long made it a mantra for his network’s members to buy an investment property only when it can be cash-flow positive.

Campbell told BIV that the COVID-19-prompted economic shock is likely to have a “psychological effect” on investors that is as significant as any economic hit that they endure.

He envisions highly leveraged mom-and-pop investor couples having some serious conversations.

“They’ll say, ‘We’ve been living on the edge forever. We might want to reassess what we’re doing,’“ Campbell said.

“This is early days here, but we’ve got an ugly four weeks coming up.”

Campbell acknowledged that the situation is changing so rapidly that predictions can be overtaken by events almost immediately, but he is convinced that a trend toward deleveraging is likely to happen because of this economic shock.

“It will happen slowly because a lot of people are locked into five-year mortgages,” he said. “All real estate trends – actual trends, as opposed to reactions – have a long tail to them. They take a while to hit into the market.” •



How COVID-19 crisis has turned what I would do to what I can’t do

I would love to be holding my newborn granddaughter. She lives in the Netherlands.

I would be in my beer-league hockey playoffs this week. I’m the goalie, so admittedly our prospects would be limited.

I would enjoy seeing the Vancouver Canucks at last in the playoffs, though, even if they didn’t last any longer than my team did.

I would enjoy the Vancouver Whitecaps and Toronto Blue Jays early in their seasons and still be typically skeptical but hopeful they would amount to much.

I would prefer that the Toronto Raptors defend their title instead of hold on to it for another year.

I would expect to be seeing Peter MacKay now on his way to the Conservative leadership. Given the campaign time-out, he must be losing sleep, and not about what all of us are.

I would like to know why our prime minister still lives in a cottage and emerges each morning at 8:15, rather like the Bill Murray character in Groundhog Day.

I would normally be seeing now if Joe Biden really has the stuff to take down Donald Trump. Instead, I am satisfied to count my blessings I am on this side of the border.

I would prefer that the stock market feel more like it’s based in New York or Toronto, not Marrakech.

I would like to see the Rolling Stones one more time. But sooner than later.

I would think the jazz festival would be terrific to take in. If only. The folk festival, too. But unlikely.

I would find it fun to walk in the park and see groups again, and it would be even more fun to hear them talk about anything else.

I would love to read a newspaper where I could be surprised about what the first several pages would cover.

I would get great pleasure seeing friends in three dimensions again.

I would enjoy walking down a supermarket aisle without people recoiling.

I would love to never have another virtual toast.

I would be pleased to learn I could have elective surgery if it were so desired and needed.

I would find it great if the Canadian Olympic team were coming together about now instead of promising to at the same time next year.

I would wish to next bang pots and pans only on New Year’s at midnight, not this evening at 7.

I would love to help build a better news organization in stable more than in destabilized times.

I would prefer, in part because I own an electric vehicle and in large part because I know what it means for the energy sector, that gas not be cheaper than bottled water.

I would love to know if I am right not to hoard toilet paper.

I would like to see late-night talk shows with the energy a live audience provides. I almost miss Saturday Night Live – little parts of it, anyway.

I would like to go shopping. Doesn’t matter for what, or what I might spend – just to go.

I would like to book a holiday. Doesn’t matter where, or what I might spend – just to go.

I would get great pleasure from a hard workout in a gym, even if I hurt for the next three days. OK, two.

I would love to listen to music. Performed. In a packed hall.

I would feel so much better if I never had to read anything again about staying productive while working at home.

I would gain so much joy hitting a seven-iron to within inches of the flag for a tap-in birdie. Not saying it’s ever happened, just that it would bring joy.

I would love for us to be dealing again with easier matters, like climate change and reconciliation.

I would prefer to enter the bus at the front and pay my way.

I would like to reserve binge-watching for when it is miserable outside, not miserable inside.

I would like to see a #eurekavaccine Twitter trend very soon.

I would wish to be in a position to never complain about a real lineup again.

I would choose to not feel pressured with this extra time to learn how to create on TikTok.

I would love to go to a movie and willingly pay so much for buttered popcorn.

I would like to start writing about the contributions of business to our prosperity again. •

Kirk LaPointe is the publisher and editor-in-chief of Business in Vancouver and the vice-president, editorial, of Glacier Media.



B.C. farmers' markets going online to keep us connected to farmers during COVID-19 crisis

You'll soon be able to order fresh food from B.C. farmers and vendors, without leaving your home

Photo: New West Farmers Market/Facebook

Last week, B.C. revealed its list of “essential” businesses and services in the province, and farmers' markets made the cut. While this means that the Vancouver Farmers Market, and other markets in the lower mainland can continue to operate - with some additional measures to aid in physical distancing and safety - the BC Association of Farmers’ Markets (BCAFM) announced March 27 they are also helping get their member markets online. 

Shifting to an online model is another way the province's many farmers and vendors can continue to provide consumers with locally-grown and prepared foods.

“It’s important to support your community and each other during this time of uncertainty, and a virtual shopping trip to a farmers market is an easy way to get the groceries on your list and to Buy BC, while ensuring physical distancing measures are being followed,” said Lana Popham, Minister of Agriculture. “Moving farmers markets online will help ensure the health and safety of vendors and consumers, while still providing the same fresh and local food that families all over the province count on.”

There are 145 BCAFM member markets, and these markets are a vital platform for the province's farmers, who rely on market stalls for a portion of their income. 

The province has made funding available to help the BCAFM member markets get to an online platform. 

Right now, the addition of the online platform is in the planning stages, but anyone interested in seeing which markets from around B.C. sign on, you can bookmark the BC Farmers' Market Trail site.

Participation in BC Farmers’ Markets Online is voluntary and an online store will not necessarily replace a physical market. 

“The critical importance and resiliency of local food and farmers has never been clearer than now, and B.C. farmers markets are an essential retail sales channel for British Columbians to access local food and sustain the livelihoods of thousands of farmers and food processors across our province,” said Heather O’Hara, executive director, BCAFM.

“Our member farmers markets continue to modify their operations to ensure the health and safety of customers, vendors and market organizers alike, and in further response to COVID-19, our new BC Farmers’ Markets Online platform will offer a new shopping channel for the peak farmers market season this summer.”

Vancouver Is Awesome


More Metro Vancouver retailers step up to sell Girl Guide Cookies

The girls can't go door to door due to COVID-19, but retailers are helping them sell their cookies

Chocolate and vanilla Girl Guide cookies. Photo: BC Girl Guides/Facebook

Usually when Girl Guide cookie season rolls around you can count on catching your local troupe set up outside stores, at your door, or passing the job off to a parent who can get you the goods at the office. But COVID-19 put a major wrench in this year's cookie-selling efforts, leaving Guide troupes across B.C. sitting on a mountain of cookies.

Fortunately, to help us all pack on that "COVID-19" (when the 19 means how many pounds we're all gaining while in "stay home" mode) several B.C. and Metro Vancouver businesses have stepped up to offer to sell Girl Guide cookies, with all of the cookie sale money going to the BC Girl Guides.

Both I.G.A. and Fresh St. Market will be selling 4,000 boxes of Girl Guide cookies at $5 each, with all proceeds going to the Guides.

Fresh St. Market, which has two Surrey locations, as well as one in West Vancouver and another to the north in Whistler, is the more upscale and locavore-oriented sibling grocer of I.G.A., which are both run by Georgia Main, the recently-rebranded food division of H.Y. Louie. The latter, of course, has roots in Vancouver dating back to 1903, and is perhaps now best known for owning London Drugs. Fresh St. recently opened their massive downtown Vancouver store at the Vancouver House development in the newly-christened "Beach District" of the city. 

London Drugs was the first to offer up their retailing services to help the Guides. As of March 25, residents of the Lower Mainland began to see Girl Guide cookies in London Drugs stores. The cookies are available at London Drugs' 82 stores across Western Canada, as well as online.

Additionally, Save-On-Foods joined in to help the Girl Guides sell their cookies, making the sweet fundraising treats available at all Save-On-Foods and Urban Fare locations from B.C. to Manitoba and north to the Yukon.

Girl Guides sell over six million boxes of cookies each year and have been selling cookies since 1927. For more information visit Girl Guides online and follow @girlguidesofcanada on Instagram or @girlguidesofcan on Twitter. 

With files from Elana Shepert and Glacier Media

Vancouver Is Awesome


These B.C. cider producers do home delivery

Made in B.C. and sent right to your doorstep

Creek and Gully cider delivers both figuratively and literally. File photo Michael Kissinger

If there’s a silver lining to this whole COVID-19 quarantine, it’s that it’s never been more socially acceptable to drink alone at home! And with many B.C. craft cider producers now doing home delivery, it’s easier than ever to get your favourite bevvies dropped off right at your doorstep. Just remember to tip the delivery driver and put on some pants while you’re at it.

With that in mind, we’ve compiled this handy guide of B.C. cideries that are doing home deliveries. Good luck, and wash your hands!

Bricker Cider Company

Home deliveries to Sunshine Coast available via online store; free over $30.

BX Press

Online shop open with local home delivery options in the Vernon area.

Cliffside Cider

Delivery available.

Creek and Gully

Free shipping across Canada on three bottles or more; 10 per cent off pick up orders.

Dominion Cider

Free shipping across Canada.

Merridale Cidery and Distillery

Open for pick-up, online orders available.

Nomad Cider

Free shipping on online purchases of $100 or more. Local pick-up is free and can be arranged for prepaid online purchases. 

Northyards Cider Co.

Delivery in Squamish only; $2.40 charge.

Sea Cider

Free delivery in the Capital Region District with six or more bottles. $20 flat rate shipping across Canada with a minimum order of one case.

Wards Cider

Free shipping to Alberta and B.C. until April 30 on order of $150 or more, free local deliveries on purchases of $100 or more. 

The Growler B.C.


What are we reading? April 2, 2020


Each week, BIV staff will share with you some of the interesting stories we have found from around the web.


Timothy Renshaw, managing editor:

From today's COVID-19 digest: good news and bad news

Good news – for robots – the pandemic is accelerating automation initiatives all over the shop. – Robotics Research


Bad news for retailers: the four horsemen of the apocalypse have just pulled up in the parking lot. – Seeking Alpha


Good news and bad news: good news for global climate futures; bad news for global gas and oil futures. – The Guardian


Mark Falkenberg, deputy managing editor:

Economists have been sounding the alarm for years about Canadian consumer debt, worrying it was setting the stage for a downturn worse than the Great Recession. A new poll shows that fear runs deep among Canadian households with the arrival of the COVID-19 pandemic. – Financial Post


This story, about the utility of baking as a stress fighter, confirms my own experience in baking simple brown bread on lazy Sunday afternoons, with the satisfaction it brings in doing something really useful. –