Month: January 2025

January 2025 – Real Estate Market Update

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Metro Vancouver Real Estate Market Closes 2024 on a Strong Note

VANCOUVER, BC – January 3, 2025 – December 2024 saw a notable uptick in home sales across Metro Vancouver, with transactions recorded on the Multiple Listing Service® (MLS®) rising by over 30% compared to December 2023. This surge reflects a growing demand in the real estate market as the year came to a close.

According to the Greater Vancouver REALTORS® (GVR), the total number of residential sales in 2024 reached 26,561, marking a 1.2% increase from 2023’s 26,249 sales. However, this figure remains 9.2% below the 29,261 sales recorded in 2022 and 20.9% below the 10-year average of 33,559 annual sales.

“2024 was a year of transition for Metro Vancouver’s real estate market,” said Andrew Lis, GVR’s director of economics and data analytics. “Following sharp increases in mortgage rates in prior years, declining borrowing costs have begun to re-energize buyers. This renewed interest is becoming increasingly evident in recent monthly sales data.”

Listings and Inventory

A total of 60,388 properties were listed on the MLS® system in 2024, an 18.7% rise from 50,894 listings in 2023 and 9.7% higher than the 55,047 listings in 2022. This figure was also 5.7% above the region’s 10-year average of 57,136 listings.

As of now, the number of active listings on the MLS® system stands at 10,948, a 24.4% increase from December 2023 and 25.3% above the 10-year seasonal average of 8,737.

Price Trends

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,171,500. This reflects a 0.5% increase compared to December 2023 and a marginal 0.1% decrease from November 2024.

“While total sales fell slightly short of our forecast, December data points to strengthening momentum in the market,” Lis noted. “Sales are trending back toward long-term averages, signaling room for growth as we move into 2025. If this momentum continues, we could see an even more active market this year.”

December 2024 Highlights

  • Residential Sales: 1,765 homes sold in December, a 31.2% increase from December 2023 but 14.9% below the 10-year seasonal average of 2,074.
  • New Listings: 1,676 new properties were listed in December, up 26.3% from December 2023, though slightly below the 10-year seasonal average of 1,695.
  • Sales-to-Active Listings Ratio: The overall ratio was 16.8%, with detached homes at 12.1%, attached homes at 23.6%, and apartments at 18.7%.

Market Segment Breakdown

  • Detached Homes: December sales reached 494, up 31.4% year-over-year. The benchmark price for detached homes was $1,997,000, a 2% annual increase, with prices holding steady compared to November 2024.
  • Apartment Homes: Sales totaled 891 in December, a 23.9% year-over-year increase. The benchmark price was $749,900, down 0.1% annually and 0.4% from November 2024.
  • Attached Homes: Townhouse sales saw the largest growth, surging 55.9% year-over-year to 371 transactions. The benchmark price was $1,114,600, up 3.4% from December 2023 and down 0.3% from November 2024.

While 2024 started on a slower note, the year closed with steady price trends and growing buyer activity. These developments set the stage for what could be a more dynamic market in 2025.

Thind Properties Faces Financial Crisis with Multiple Foreclosures and Legal Issues on Maywood, Brentwood, and Other Projects

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Burnaby-based real estate developer Thind Properties is in the midst of a severe financial crisis, facing foreclosure, creditor protection, and multiple lawsuits. The company, headed by founder Daljit Thind, is grappling with unpaid debts on several major projects, including the Maywood development near Metrotown, the Eclipse Brentwood tower, and multiple other ventures in Burnaby, Surrey, and Richmond.

Maywood Development Under Foreclosure

Thind Properties’ troubles began with its acquisition of the Madeira Manor property at 6677 Silver Avenue (4330 Maywood Street) in Burnaby, which was purchased from Kirpal Group in 2024 for $22 million. The project, planned for a 24-storey tower, has now come under foreclosure after the company failed to meet its financial obligations.

The City of Burnaby had previously approved a rezoning plan for the site, with Thind agreeing to assume responsibility for an outstanding density bonus payment of over $5.6 million, plus interest. However, Thind has failed to make any payments on this debt since taking over the property, leading the city to file a lawsuit in December 2024. The total amount owed to the City now exceeds $6.9 million.

On top of this, Thind is facing foreclosure proceedings from multiple lenders, including Bancorp Financial Services and Strandlund Investments, who are owed more than $8 million on a second-ranking mortgage for the Maywood property. If the company cannot pay off this debt, the property could be sold to recover the funds, exacerbating Thind’s mounting financial woes.

Eclipse Brentwood and $189 Million Debt

Thind Properties’ financial struggles extend beyond the Maywood project. The company is also grappling with significant debt related to its Eclipse Brentwood development at 2381 Beta Avenue, a 34-storey tower near Burnaby’s Brentwood Town Centre. Despite being nearly 95% complete, the project has come to a standstill due to financial difficulties.

KingSett Capital, the lender for Eclipse Brentwood, has initiated creditor protection proceedings against Thind, as the company owes $189 million in mortgage debt. This amount continues to accrue interest daily, further compounding Thind’s financial troubles. Additionally, KingSett has uncovered a judgment from the Canada Revenue Agency for over $11 million, further undermining Thind’s cash flow and ability to secure additional financing.

As construction on Eclipse Brentwood has halted, the company is struggling to reinstate home warranty insurance, which is required for the completion of the project. KingSett has stepped in to offer financing to resume construction, but without a clear resolution, the project’s future remains uncertain.

Additional Legal Challenges and Receiverships

Thind Properties is also facing receivership proceedings on several other projects, including the Highline Metrotown tower in Burnaby and the District Northwest development in Surrey. KingSett Capital, which is involved in the receiverships, holds a substantial amount of debt related to these properties as well, totaling approximately $500 million.

In December 2024, Thind Properties was placed under creditor protection in relation to these projects. The company is now scrambling to find a way to navigate its dire financial situation, with the potential sale of assets or restructuring as possible outcomes.

A Developer on the Brink

The ongoing financial challenges of Thind Properties have cast doubt on its ability to recover. With lawsuits, foreclosures, and creditor protection proceedings mounting, the developer’s future remains uncertain. As Thind Properties faces legal and financial scrutiny, it is unclear whether the company can resolve its issues or whether these projects will be taken over by creditors or other developers.

The Maywood, Eclipse Brentwood, and other developments are now mired in a complex web of legal disputes, foreclosure proceedings, and mounting debt, leaving creditors, tenants, and stakeholders in a precarious position. Whether Thind Properties will be able to emerge from this crisis or be forced into liquidation remains to be seen.

Everything you need to know about the new anti-flipping tax in BC

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Understanding the BC Home Flipping Tax: What You Need to Know

The real estate market in British Columbia is set to experience a significant shift with the introduction of the BC Home Flipping Tax. This tax, part of the Homes for People Plan, is designed to discourage short-term property flipping for profit. Let’s break down everything you need to know about this new tax, effective January 1, 2025.

What is the BC Home Flipping Tax?

The BC Home Flipping Tax applies to profits earned from selling residential properties or presale contracts in British Columbia if the property is owned for less than 730 days. The tax is governed by the Residential Property (Short-Term Holding) Profit Tax Act and is separate from federal property flipping rules and other income tax systems.

Key Features of the Tax

  • Effective Date: January 1, 2025.
  • Scope: Applies to residential properties, including housing units and presale contracts.
  • Ownership Threshold: Properties sold within 730 days of purchase are subject to the tax unless an exemption applies.
  • Tax Rates:
    • 20% on profits for sales within 365 days of purchase.
    • Gradually decreases to zero after 730 days of ownership.

Who is Subject to the Tax?

Any individual, corporation, partnership, or trust selling a taxable property within 730 days of purchase may be subject to the tax. This applies to residents of BC as well as individuals or entities outside the province.

Example 1:

  • Property purchased: May 1, 2023.
  • Property sold: January 31, 2025.
  • Tax applies (642 days of ownership).

Example 2:

  • Property purchased: May 1, 2023.
  • Property sold: June 1, 2025.
  • No tax (762 days of ownership).

What Qualifies as a Taxable Property?

  • Residential properties with housing units or those zoned for residential use.
  • Rights to acquire residential properties, such as assignments of presale contracts.

Exclusions:

  • Leasehold interests or properties in exempt locations.
  • Gifts, mortgages, and other transactions that do not involve a transfer of beneficial ownership.

Do You Need to File a Tax Return?

You must file a BC Home Flipping Tax return within 90 days of selling a property if:

  • The property is sold within 729 days of purchase and no automatic exemptions apply.
  • Your exemption requires filing to be claimed.

You do NOT need to file a return if:

  • You owned the property for 730 days or more before selling.
  • Your exemption applies automatically.

Exemptions from the Tax

Certain sales may qualify for exemptions, including:

  • Transfers between related persons.
  • Sales involving primary residences (subject to conditions).

Primary Residence Deduction: If you owned and lived in the property as your primary residence for at least 365 consecutive days, you may deduct up to $20,000 from taxable income.

Example:

  • Sam owned and lived in a property for 20 months before selling. Sam qualifies for the deduction.
  • Amrita owned and lived in a condo for only 6 months. She does not qualify for the deduction.

How is the Tax Calculated?

The tax applies to the net taxable income from the sale of a property owned for less than 730 days. The rate decreases the longer you own the property, with no tax owed after 730 days.

Days of Ownership Calculation:

  • Start counting from the day you purchase the property (typically the closing date).
  • End with the day you sell the property (typically the closing date of the sale).

Impact on Presale Contracts and Related Transactions

  • For presale contracts, the date of purchase is typically when you enter the contract or pay the deposit.
  • Sales between related persons may use the original purchase date of the related seller for tax calculations.

Example 1:

  • A developer enters a presale contract on June 1, 2025, for a condo completed on March 1, 2027.
  • The ownership date for tax purposes is June 1, 2025.

Example 2:

  • Michael buys a property from his father, who originally purchased it in 2020.
  • For tax purposes, Michael’s ownership date is deemed to be the father’s purchase date.

Why Does This Matter?

The BC Home Flipping Tax is a critical measure to curb speculative real estate practices and promote housing stability. If you’re considering selling property in BC, understanding these rules is essential to avoid unexpected tax liabilities.

Stay informed and plan your real estate transactions carefully to navigate these new regulations. For more details, consult a tax professional or visit the official government resources.