The topic of affordability has been a worrisome debate in Vancouver for some time, with many families believing that even with scrupulous saving habits and dual incomes, it’s no longer possible for them to live in the city.
A new project was launched recently, aimed specifically at this issue. In order to make pricing work, the developer at 60 W Cordova took out everything seen as non-essential. There are no parking stalls, no washer/dryers in the units, and no amenities in the building. There are no fancy finishings.
By juggling the numbers, Vancity Credit Union even created a financing model specifically for the development that allowed buyers to put down as little as $6450 as a down payment on a $300,000 apartment, resulting in a monthly mortgage payment of $1356 (yes, that’s really good!)
Value is a relative idea though, so I was curious about how these units would stack up against others in downtown Vancouver.
402-60 W Cordova St., Vancouver, BC
List price: $299,900
THE DEETS: 2 bedroom, 2 bathroom condo, 775 sq ft, to be completed in 2012
THE NABE: 60 W. Cordova is in an area known as the Downtown Eastside, which has been associated for more than fifteen years with urban decay. But there is new energy coming into the area from a combination of factors. A development just a few meters away has units that are two or even three times the price.
THE CAVEAT: There is a limit on how many units in 60 W Cordova can be rented out, and owners won’t be allowed to sell the apartments for at least a year after they’re finished.
309-58 Keefer St., Vancouver, BC
List price: $469,000
THE DEETS: 2 bedroom, 2 bathroom condo, 817 sq ft, built in 2007
THE NABE: Let’s take this as a comparable for a savvy real estate buyer. The building is located less than 500 meters from 60 W. Cordova, but many would argue it’s a very different area.
- One floor lower: subtract $3000 to $7000
- Larger: add $25,000 (based on a difference of 42 sq ft x $600, an average $/sq ft in Vancouver)
- Parking spot included: add $40,000
- Storage locker included: add $15,000
- Gym included: add $15,000 (factoring in size of facility, convenience, and eliminating cost of gym membership)
After doing that math, there’s still nearly an eighty thousand dollar variance in price, with the biggest intangible being the difference in location.
The realtor reports an offer has been tendered on the property, so clearly someone thinks the difference is worth paying for.
413-1275 Hamilton St., Vancouver, BC
List price: $559,000
THE DEETS: 2 bedroom, 2 bathroom condo, 818 sq ft, built in 2002
THE NABE: This is nearly two kilometers away from 60 W Cordova, in an area known for expensive boutiques, high-end restaurants, and upscale salons. The finishings in this suite are upscale as well.
THE MATH: Is it worth nearly twice the price? More important perhaps, is the question of how many people could come up with the 25% down payment of $140,000… That dilemma is only going to grow as property values continue to grow in Vancouver.
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