Foreclosure

I spent last night reading over all the posts I’ve written.  The earliest days of the blog — specifically those leading up to the market peak in Spring 2008 — are undoubtedly the best.  It’s in this period where the writing’s ironic deconstruction is at its most devastating and most funny.

Part of me longs for the days of bidding wars and double-digit appreciation. In those insane times Vancouver hit the apex of its narcissism.  In our self-love, we found meaning in a condo-cultural existence.  Sophisticated.  Discerning.  Urbane. Marketers called it “the lifestyle.”  Vancouver, the city of dreams — yours to own — starting at $800 a square foot.

After more than 24 months, 200 posts and millions in disappeared market value, Condohype is in foreclosure.  This is my last post.  Falling prices and a contracting economy have humbled the Vancouver real estate fantasia.  The changing conditions of the market make my brand of comedy less funny.  Irony is my weapon of choice and there’s no irony in watching an inflated economy collapse.  It is the natural course.

History will be mostly unkind when it looks back on the boom years.  So much of a culture is summed by the advertising of the day.  When researchers look back at the condo ads, what will they make of Vancouver circa 2002-2008?  Probably a lot like what we make of consumer marketing of the 1950s:  Silly, offensive and alien to modern values.  Father knows best?  Own the lifestyle?

Despite all that’s happened, I still love Vancouver.  It’s a strange love but love nonetheless.  It’s like that crush you had in high school — the one that rejected you and you’re madly in love with regardless.  Over the years, you may have become bitter, at times even angry, but you never give up that some day the dream will come to be. (Those who give up move to Toronto.)

So, I guess this is the part where we say goodbye.  In the interest of full disclosure, I’ll put an end to the rumour about my identity.  For the record, I am not Bob Rennie.

Thank you so much for reading.  I hope you’ve had a fun time.  The comments are open for final thoughts.

Photo credit: Tannoy

The incredible bulk

You could almost believe the ad is coloured with human blood.  This is a full-pager for the second phase of Mac Marketing’s condo slaughter sale.  A full page in The Vancouver Sun is in the ballpark of a downpayment on a starter home.  By starter home I mean one-bedroom apartment.  If you think I’m talking SFH, you’re high on drugs or live in Prince Rupert, or both.

I have little to say about the value of the Mac Bulk condos.  You’ll have to do your own research.  From a marketing perspective, I like the simplicity of the campaign, though I could do without the corporate masturbation in the copy.  Actually I could really do without it.  Consumers don’t care who “negotiated” the discount pricing.  The point is the pricing.  That’s it.  Everything else is pump-up talk for the sales staff.  Save it for your next Tony Robbins seminar.  If we’re gonna talk real estate, let’s talk price.

Individuality has a floor plan

For once, I’d like a condo ad to appeal to something other than individuality. Can’t people buy shelter for its value as — wait for it — shelter?  

Today’s ad is vintage fromage.  It’s stinky bad.  Get a whiff of this copy:

For you, everything is not black or white.  You appreciate both refined classic elegance and innovative contemporary flair.  You respect the past but revel in the possibilities of the future.  That’s why Q1 is the perfect showcase for your sophisticated style.  In South East False Creek’s newest community you’ll find comfort, convenience and an exciting, distinctive neighbourhood that mirrors your individuality.

Q1, more than an address — a bold statement of your signature style.

You could have a master’s degree in English and there’s no making sense of this.  I bet the author doesn’t even know what it means.  A neighbourhood that mirrors your individuality?  Incredibly, someone thought the ad would be “lacking” if it didn’t have the prose.

If Adam Smith were alive today, he’d strangle himself with his own invisible hand.

Condohype meets Mansbridge

There’s a possibility of a Condohype appearance on tonight’s edition of The National.  Fewer things in life are better than Peter Mansbridge, and this is coming from a guy who owns a stainless-steel fridge.

Tonight, Peter and the gang are doing a special feature on Vancouver real estate.   The mothership is already linking here so you know their coverage is gonna be hipper than most.  Should this blog get an on-air mention, this writer would experience such extraordinary delight, it could spell an end to my curmudgeonly ways for good.

The National airs at 6pm on Newsworld, 10pm on the main network, and about 14 other times in between.  If you miss it, Rex Murphy will hit you with a devastating cutting remark.  He’s a Rhodes scholar.  Don’t mess with him.

A tribute to urban duress

Pass it on.  This is the tagline for a new campaign from MAC Marketing Solutions, the creator of Onni’s condo liquidation sale.  This time, MAC’s working magic for Amacon’s Beasley project in Yaletown.  Some of you might remember The Beasley as the “tribute to urban excellence” that never got off the ground.

At a news conference today, condo marketer Cameron McNeill said most units will see price drops of $100,000 to $250,000.  But in a twist, the rollbacks are retroactive.  Early purchasers, not just new ones, get the benefit of the reductions.

The marketer says the rollback is all about passing on the savings of lower construction costs.  I say hogwash.  The name of the game is profit.  Nobody passes on savings unless they have to. The price reduction is not altruistic, it’s a function of the market.  At higher prices, these condos can’t sell.

The most interesting dimension of the promo is the rollback for the original buyers.  It’s proof of the fragility of pre-sales.  The developer probably realizes many of the early pre-sale buyers can’t/won’t complete on the original prices.  My guess is the developer’s calculated it makes more sense to slash prices across the board than risk the time and expense of litigation.

Let us step back and think about what this means.  Nobody “gives away” profits.  To reduce prices on signed contracts tells you those contracts aren’t secure.   It’s a developer’s nightmare.  What’s the value of pre-sales if buyers can’t close?  This is an industry-wide problem and Amacon is the first to face the music.  The precedent is set for retroactive discounts.

This is a warning sign of trouble to come.  As I’ve said before, the one to watch is Woodward’s.  The clock is ticking.

The best democracy money can buy

Under B.C. law, it’s perfectly legit for candidates for municipal office to accept unlimited sums of money from unions, corporations and non-citizens.  The only requirement is disclosure.  So as long as it’s reported, there’s no stopping anyone — from Osama bin Laden to Kevin Bacon — from making a donation.

In Vancouver, the parties spent over $5-million to compete for the right to govern.  Non-voting entities happily greased the campaigns.  By “greased” I mean nothing untoward.  The law was followed.  The problem is the law.  It makes sell-outs of every party.  Even parties that don’t want to be sell-outs.

Pretty much every business regulated by the city gave money — bars, restaurants, developers.  Some of the big boys, like Concord Pacific, swung both ways.  They gave $35,000 to Vision Vancouver and around $12,000 to the NPA.  Bob Rennie gifted $35,000 in advertising to the NPA.  Meanwhile, Rennie Marketing Systems handed $1,000 to Vision.

Financial disclosures are posted online by the City of Vancouver.  The documents are posted as submitted.  They’re very poorly formatted and there’s no consistency.  Vision’s doc is alphabetical.  The NPA disclosure is chronological but it breaks out into special sections for payment method.  Incredibly, Rob (“Fear the NDP Bolsheviks”) Macdonald made one of his donations via Paypal.  I like this guy even more.

Hat tip to Frances Bula for the link to the disclosure docs.  If you’re a geek for city politics, you need to be reading her excellent blog.

Photo credit: Urban Mixer

My unfair lady

I took the Skytrain to work today.  Along the way, my iPod cued up a rather unsatisfying track by Lily Allen.  The song, called “No Fair,” concerns Ms. Allen’s bedroom misfortunes with her nice-guy boyfriend. (Or should I say ex-boyfriend?)

A song in a playlist might seem uneventful but the train happened to be passing the Olympic Village site.  The big misfortune.   Talk about no fair.

Miro Cernetig recently had a sit-down with the mayor to chat about the first 90 days on the job.  Being 90 days, this is the end of Gregor’s warranty period.  Miro touches on Millennium Watergate and the potential cost to taxpayers.  The mayor’s advisers privately forecast losses in the $200-300 million range. This isn’t good news but at least it’s realistic news.  Two months ago, wet dreams of a “market rebound” had the politicos contemplating profits.

In other news, Quatchi remains uncooperative with the investigation into Peter Ladner’s stolen memo.

Photo credit: Smith

Beneath the Burrard Street Bridge

This weekend it was sunny and it snowed, and Oprah didn’t buy the penthouse.  Vancouver is a crazy place.  I love it to death, never mind my occasional mad rant.  Isn’t being a curmudgeon is part of who we are?  Whether it’s Kerrisdale NIMBYs, Bus Riders’ Unionists, or anyone perched on the steps of the art gallery, Vancouver people find purpose in a constant state of upset.

I once attended a lecture at the VPL about the future of newspapers.  On the panel were media people like Charlie Smith from the Georgia Straight. When the mic came to the audience, everyone had something to whine about.  One guy even laid into the press for not reporting the “connection” between Osama bin Laden and a “secret base” under the Burrard Street Bridge.

The conspiracy theorist’s rant is a classic Vancouver moment.  Nothing about real estate prices is going to change this.  Same goes for your marble countertop or Miele range.  A city isn’t the sum of its glossy appliances.  Whether things go boom or bust, whether you’re a renter or buyer, Vancouver is Vancouver.  Always.

Photo credit: Dylan Yee

Realtors and the magic of PR math

In the business, we joke about PR math. This is when marketers use real data to create an unreal impression. The beauty of PR math is its supposed ethical soundness. Real numbers don’t lie. Similarly, President Clinton “did not have sexual relations with that woman, Ms. Lewinsky.”

Realtors gladly use PR math. Today’s post shows an example from a westside agent. Because many realtors are running ads like this, I’ve concealed the realtor’s identity so that she’s not unduly singled out. The ad asks “why rent?” and compares rental prices to mortgage payments for an average downtown condo.

I threw the numbers over to Mohican at Housing Analysis, who kindly responded that they are correct. But there’s a caveat and it’s a biggie: You have to factor out taxes and strata fees and have interest rates remain at record lows. Here’s the word:

Thirty-five years amortization is the short answer. One-year mortgages are now at 3.5 per cent and a payment of $1,275 can get on the hook for a cool $310,000. Sounds like a bad idea to me but what do I know, I’m only a financial planner.

I rent downtown, at a place assessed around $300,000, and my rent is very close to the realtor’s example. But my landlord pays the strata, taxes and insurance out of my rent. It’s probably $500 a month. The ad does not mention these costs and for good reason. It’s bad PR math! Own for the price of rent plus 40 per cent or more. Yikes.

Bob Rennie, king of parking tickets

“It’s embarrassing.  But I think it’s just a cost of being busy.”  -Bob Rennie

When you’re the condo king, you’ve got better things to do than plug the meter.  That’s the word from Bob Rennie, condo marketer extraordinaire, who today was outed as one of the Vancouver’s worst parking ticket offenders.

In five years, Bob’s Bentley racked up a market-leading 204 tickets.  Most of the infractions are from meters around his office.

Bob philosophizes that the cost of paying the tickets is less than buying a parking spot, and that street parking is far more convenient.  In other words, it’s a business decision based on costs and value for money.

Funny, I use the same logic when I look at renting versus owning.