Construction and more Construction - Langley

This information is from the March 2008 BC Major Projects Inventory.

Langley Airport Expansion
Status: Construction started Start: Sep 2007
Est. Cost ($ million): 20 Finish: Late 2008

Willoughby Community Recreation Centre
Status: Construction started Start: Fall 2007
Est. Cost ($ million): 56 Finish: Late 2008

South Village Condominium Development
Status: Construction started Start: May 2007
Est. Cost ($ million): 40 Finish: 2009

North East Gordon Estates Residential Development
Status: Construction started Start: Fall 2007
Est. Cost ($ million): 80 Finish: 2010

The Village at Thunderbird Centre
Status: Construction started Start: Late 2005
Est. Cost ($ million): 50 Finish: Sep 2009

Gateway 200 Business Park
Status: Construction started Start: Summer 2004
Est. Cost ($ million): 20 Finish: 2010

Golden Ears Bridge
Status: Construction started Start: Jun 2006
Est. Cost ($ million): 808 Finish: Summer 2009


Bedford Landing
Status: Construction started Start: Late 2006
Est. Cost ($ million): 400 Finish: 2009

Total major projects currently underway just in Langley: 8
Cost of major projects currently underway just in Langley: $1,454,000,000
Majority of work is complete by late 2008.

What happens when all those projects finish, all the money is spent and all the workers go home?

Observations From the Street

The weather was so nice this weekend, the wife and I decided to take baby mohican for a little drive. No better way to celebrate good weather in the suburbs than burning fossil fuels!

Some interesting observations from driving a little bit off the beaten path.

1) We aren't even close to running out of developable land.
2) There are innumerable new homes under construction in Langley / Surrey.
3) There are many "Development Proposal" signs all over the place for new subdivisions that contain 50 - 500 homes. (Bedford Landing, Milner Heights, Yorkson, Copper Creek, Clayton, and more - these are by developers like Parklane, Adera, Morningstar, Solterra, Foxridge, and lots of other smaller developers)
4) There were hundreds of for sale signs, mostly in new home developments. I assume most of these homes for sale are speculators or developers trying to sell their investment. Very few "sold" signs.

What are your observations from where you were out and about this weekend?

Oops! $400 million down the drain.

Fraser threatens housing development

Partly built subdivision sits on what was flood plain next to Bedford Channel

Kent Spencer
The Province
Monday, June 04, 2007

CREDIT: Parklane's housing development Bedford Landing along the Fraser River in Langley is bracing for spring freshet with a new set of regulations handed down by the government. Most of the newly constructed home's basements will be one metre below the flood level.

A $400-million housing development on the banks of the Fraser in Fort Langley is in danger from the rising river. "We're in the process of understanding what the implications are in relation to water rising," said Randy Dick, manager of the Bedford Landing development for ParkLane Homes. "We're up high. That's the good news. "It's too early to say what the solution is in the long term. For the short term, with the freshet coming, we're going to keep the water table down with flap gates and pumps."

The development bills itself as "waterfront living in the heart of Fort Langley." The partly built subdivision sits on what was once the flood plain next to the Bedford Channel. Basements of the Bedford homes sit at 6.6 metres. But when protection levels were raised from 6.6 to 7.6 m in January, the basements fell below standard. The standard was adjusted after officials realized their 1969-based models were missing key factors, such as runoff caused by pine-beetle devastation.

Most Fraser Valley dikes are about 8.5 m in height. During the catastrophic flood of 1894, the river reached a height of almost eight metres above sea level. Forecasters say the Fraser could reach six metres soon if hot weather continues. Langley has ordered ParkLane to come up with a plan to keep water off the Bedford site. The developer is installing pumps, valves and flap gates. The pumps will take excess water away and the flap gates will prevent river water from flowing backwards up the storm drains.

Protection measures include shoring up the riverbank and repositioning a section of the dike. Ramin Seifi, Langley Township development manager, said the extra flood protection will cost between $1 million and $10 million. It will be paid by ParkLane, which Seifi said the developer was not happy to hear about. "These things are not cheap, especially a retrofit," said Seifi. "[But] ParkLane realizes these things are unavoidable." Dick, the project manager, said he was not upset about the cost: "We had to put in a number of works anyway . . . It's too early to say what the final cost will be."

Connie Blundy, who bought her half-million-dollar home just 200 m from the river three weeks ago, said she was reassured by the developer's commitment to make homes that would withstand a one-in-a-100-year event. She said she was told it took two years to fill the 31-hectare site with sand from the river bottom, elevating it from the lower-lying flood plain. "Perhaps I should be [concerned], but I'm not really," she said. "The water could cover the basement to a depth of one foot. It would not be the end of the world."

The muddy waters are rising noticeably, said a group of teens suntanning near the Bedford construction site. "It's not so much frightening, as inconvenient," said Fort Langley's Shelby Cairns. "School might have to be relocated." Langley Township didn't maintain a right-of-way to an old dike on the edge of the development when it sold the land to the developer. Seifi said the dike was rendered unnecessary because of the landfill put in by the developer. But provincial dike inspector Neil Peters said the B.C. government would like to see Langley have the right-of-way. "We want to have a right-of-way documented for a future dike," he said.
© The Vancouver Province 2007

Real Estate: House Prices Still High

It looks like our 'economist' friend Cam Muir is interested in the Langley real estate market! This article from the January 9th, 2007 Langley Advance newspaper tromps out the usual suspects: BCREA Economist, Head of the FVREB, and even some politicians but not any real analysis or solid journalism.

The price of a home in Langley has almost doubled during the past five years.
by Matthew Claxton
Langley Advance, January 9, 2007

For those buying their dream home in Langley, 2001 was a lot easier on the pocketbook than 2006. The Fraser Valley Real Estate Board released a five-year analysis of home prices to ring in the new year. Prices for a single detached home in Langley have risen by 86.3 per cent over five years, from an average price of $247,000 to $460,137. Townhouses and apartments were affected similarly. Townhouses prices have gone up by 70.8 per cent, from $164,235 to $278,782. Apartment prices have risen by 90.6 per cent, from $102,046 to $194,491. Few people would have predicted this kind of jump in 2001, said Fraser Valley Real Estate Board president David Rishel. "I try to avoid any kind of predictions," Rishel said. Realtors never know what will be next when it comes to housing prices and demand, he said.

In hindsight, he believes much of the jump was due to the globalization of the real estate market. British Columbia is a desirable place to live and was seen as a bargain by many compared to other world urban centres, said Rishel. That led to five years of solid price increases. The most notable fact about 2006 might be the fact that price increases and sales actually cooled off in the second half of the year. The best year for local real estate sales ever was 2005, Rishel said. "The first half of 2006 looked like a replay of 2005," Rishel said. By the end of the year, however, the number of listings in the Lower Mainland was up by 46 per cent and the price hikes had begun to slow down. The year overall was still great for people selling homes, said Rishel. "2006 shaped up to be the second-best year in real estate ever," he said. While he remains reluctant to predict the future, Rishel said other groups are guessing that the Lower Mainland will see lower but still respectable growth in the housing market in 2007.

"When we look at the market overall, we expect to see a little less frenetic activity over the past 18 months or so," said Cameron Muir, chief economist of the B.C. Real Estate Association. All the conditions that drove prices so high in 2005 are still present, said Muir. B.C. has strong job and wage growth, people moving here from other parts of Canada and the world, and relatively low interest rates. Muir, a Langley resident, noted that there are also local incentives to buy, like the retail corridor along 200th Street and strong job growth in Langley, Surrey, and Abbotsford. "The only thing that's not as positive is home prices," Muir said. With the average price of a listed Langley home approaching half a million dollars, it's getting harder for people to afford a first home. Some buyers are being squeezed out, said Muir. That is leading to the slowing pace of both purchases and price hikes. Muir predicts that increases in home prices by percentage, in Langley and around the region, will be confined to single digits rather than double digits in 2007. The slowing pace of growth has not yet been felt at the Township hall, said Mayor Kurt Alberts. If growth does slow substantially, it will be several months before the planners and clerks who deal with construction applications notice the let-up, Alberts said. "What it means is that there's not as many new applications coming in," Alberts said.

Like a Slow Moving Train Wreck?

Real Estate market corrections have been likened to slow moving train wrecks and I couldn't resist the analogy to the new home development in Fort Langley called Bedford Landing. I have been quite interested in the $400,000,000, 378 home, 78 acre Bedford Landing development in Fort Langley for two reasons:
1) I like Fort Langley, its charm and historic significance, wouldn't even mind owning a home there someday and
2) I think it is a barometer for sentiment in Fraser Valley Real Estate.

Check it out here: www.bedfordlanding.com
I had the opportunity to tour the discovery centre, sales centre, and showhomes recently and I have followed the press on the development for a couple years now.

Here are some of my observations about what most people see:

1) Lots of local press dedicated to how 'fantastic' the development is and what a 'great impact' it will have on the area.
2) Plenty of press about the 'pent up demand' for the homes
3) Enthusiastic public officials, developer staff, and newspaper articles
4) The obligatory overnight line up for the 'opportunity' to put a deposit on a home
5) Insane stories about people travelling from far away places to live there
6) Townhomes are $375,000 to $400,000 and Single Family Homes are $475,000 to $600,000 with the next release having homes up to $1,200,000.

Here are a few other observations that don't get the press:

1) The development is right beside the main CN Rail line which has 16 freight trains per day traveling past at 80-100 km/h. Two trains went past while I was touring the show homes and the homes shake as the train goes past.
2) The development was built hastily on top of 5 - 8 metres of sand infill dredged from the Bedford Channel.
3) Its on an old mill site - who knows what's underneath the ground?
4) Only half of the homes available for sale have actually sold now - where did the line up go? What about all that pent up demand?
5) Where will all of these people (1000+) shop, drive, go to school, etc? There are no plans for increased amenities in the area and Fort Langley has significant development restrictions.

My take on these observations is that the potential buyers are not so enthusiastic about the homes at current prices and thus that ‘pent-up’ demand has dried up, the demand was false and fabricated, or the people causing the demand are unable to afford the homes at the asking prices. We will see how long it takes before the developer lowers prices to meet potential buyers.
So, is our Real Estate market a slow moving train wreck?