Does buying pre-construction make sense for homeowners and investors right now? The short answer: that depends. President of Key Marketing, Cam Good, and VP of Operations Nick Campbell sit down with Adam & Matt to discuss the number of factors that every potential buyer should consider before pulling the trigger on pre-construction. Where are the current opportunities in Metro Vancouver? Why does every potential buyer need to think like an investor? And, most importantly, how can you secure a home in this highly competitive market? Insider insight straight from the team in charge of the highly anticipated Melrose Tower in Surrey City Centre! A must listen!
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Please tell us about yourselves.
Cam: I’m the founder of Key Marketing and first and foremost, a husband and dad. My family is my number one priority. With the rest of my time, I’m staying healthy so I can live to 100, and having fun in real estate.
Nick: I’m the VP of Operations at Key and have been with Key for five years now. I’m also a realtor. I live and work in Gastown with my girlfriend and our little chihuahua.
Why real estate?
Cam: I got into real estate through investing. I was an entrepreneur in high-tech and had some moderate success. I figured out how to flip a condo back in the early 2000s and a buddy of mine talked me into going into business with him and his boss. By 2004, I was exiting tech and so I told my friend I was ready to join his business and just be a part of it.
Nick: I worked in oil trading in Calgary before real estate. When it started to tank, I realized I’d be the first to go as I was a junior in the company. So I moved back to Vancouver and got my real estate licence. To get experience, I found a job as a project manager on Craigslist that involved calling over 100 realtors a day to attend an event. And that ended up being a job with Key. I worked hard, did a good job and six months later, they had an opening for a market analysis role. So I jumped on that and from there, have kept growing with the company.
How did you go from flipping condos to Key Marketing?
Cam: After talking my way onto a junior role on the sales team of my friend’s company, I worked hard and was able to compete for an opportunity to lead sales only 11 months after joining. I was becoming a partner in 2008 but then the economic meltdown happened and the deal fell through. We started a new partnership that went well and then I opened Key Marketing in 2009.
Tell us more about Key and where you work.
Cam: We’re active in BC. We’ve been around for 12 years and have learned so much. We’re on an amazing trajectory with an amazing team. We have three company values: passion – it can’t just be about the money, you have to love it; speed of trust – which is all about radical honesty; kaizen – which is a Japanese word that means constant improvement.
We’re in the team building business. The foundation of a great team is trust.
Are your clients shocked by how Key approaches everything?
Cam: I think so. And honestly, it’s kind of fun to shock people with straight and direct answers. People like it because they’re so tired of BS – no one likes to be lied to. So I’ve created an environment with a high level of trust and radical honesty. We have so much energy, trust and collaboration at Key and that is what gives us our competitive edge.
How is the market?
Cam: It’s amazing. It got wild there for a minute with covid but we have a good foundation. Real estate is the second most popular thing to talk about in Vancouver, second to the Canucks. We also have a foundation in tech, since that’s my background, which prepared us well through covid.
The first part of the pandemic was just about survival. To be successful in our business, you have to have the right number of projects in the right markets at the right time. 2020 was our turn. We had 16 launches scheduled, which turned into 4.
We continued to work hard. Our company slogan is, “Open every door” which tells us we need to innovate and turn over every stone. We launched a few projects during the pandemic that were pretty successful.
Nick: Things got better in the summer of 2020 and we felt more confident. We took a project in Coquitlam and one in the Cambie Corridor to market. We sold out that project in Coquitlam and hit all of our developer’s targets. That told us we could sell in covid, even with extra protocols, private appointments, extra space at presentation centres, etc.
That gave us a lot of confidence going into 2021. We had Belvedere in Surrey Centre coming up in 2021 which was bigger than our 2020 projects. But we could feel the pent up demand in the market. This gave us a huge opportunity.
Let’s talk about that pent up demand. Who are the buyers?
Nick: I’d say it’s a good mix of end-users and investors. In Surrey, we’re seeing a lot of families investing together. There are the twenty-somethings who want to get on the property ladder so their parents and grandparents help out and they buy one or two units together. These families believe in the product and their community. These are people who have lived in Surrey for 20+ years. It’s a lot of working class and local buyers.
Cam: I love this business but one thing I like the least is the foreign investor conversation. I don’t like being a bad guy; it doesn’t sit well with me. What I’ve loved about the pandemic market is it’s 100% locals and new immigrants. And I love that story of Canadian immigrants finding that new home and level of success.
What gives you the confidence to move forward with projects?
Cam: There’s a balance between art and science for our part of the business. We have data, we can test the market, and we can talk to realtors. The art side is our intuition and experience. So combining those things allows us to feel confident and be successful. We have a relentless work ethic to open every door. We’re innovative and creative but we’re not flying by the seat of our pants.
For example, we launched a project in Surrey, Q5, during what became the third wave of the pandemic. It was a lot of work but we did end up selling out the project in one day with no one in the sales centre. Everyone bought from their living room. It was bizarre!
Have you been surprised by the market?
Cam: I have been pleasantly surprised. If I said I knew this was going to happen, I wouldn’t be telling the truth. I knew we could launch projects successfully if we did it certain ways but the demand has been amazing.
I love buyers; I love the Vancouver market. Real estate is the best investment in the world and Vancouver is a great place to buy. How we’ve survived the pandemic has only lifted our brand globally. I’m happy for the locals who have had some breathing room from that global demand to get on the property ladder or move up the ladder.
Let’s talk about the factors that drove demand in the presale market. What’s different about presale compared to resale?
Cam: Presale has evolved a lot over the last 20 years. It’s become much more commonplace. It’s easy for people to buy presale. Presale has a time factor that works for people, allowing buyers to finish their deposits over a few years. Many presale buyers are buying for themselves but they are thinking about the future investment.
Long term thinkers like that they can fix the price now while the cost of the market keeps going up during construction. They might earn a 100% return on their deposit by the time they complete on their home. There’s no investment opportunity that compares to that.
I don’t think anyone would buy presale if they didn’t believe that prices would keep going up. Our industry is sentiment-based. When things slow down in presale, it’s because people don’t think the market is as strong.
What areas in BC are you most excited about?
Cam: Surrey is very exciting right now. It’s the third fastest growing city in Canada and will double in size by 2040. The municipality is very aggressive in solving the supply issue and there’s massive infrastructure investment happening in Surrey. Savvy investors follow the infrastructure investment. Surrey is booming!
At our upcoming launch to the west of Surrey Central, Melrose, we’re attracting a very cool crowd. It’s younger people who have that cool factor.
Nick: I’m excited to see downtown Vancouver come back after being crushed by the pandemic. I’m excited to see the core and the heart of the Lower Mainland come back strong. It’s a pricey place but I’m glad to see the city is back.
Cam: We’re looking at new markets in BC. For us to move to Vancouver Island or the interior, we have to be 100% sure. It has to be the right opportunity. We will get there eventually but there’s no rush. We have three more launches in Surrey this year and three townhome projects coming up in Vancouver.
When does Key get involved with a project?
Cam: The latest we’ve ever been hired was two weeks before the launch. Ideally, we’re hired around when the architect is hired, or even before. We want to affect the design and compliment what developers are doing. Architects don’t want to be told what to do by sales people but we’ve found a way to help them design the most appealing building with our data-based approach. So as early as possible is best.
Has covid changed buying habits?
Cam: Yes. But it takes time to implement the new buyer demands, so it’s tricky. It’s hard to completely redesign a building. But we are seeing interesting changes. People want to be able to work from home and want more space. They want to be able to walk more and commute less. These are stronger factors in buyers’ decisions.
There’s always room for an investor to buy studios and one-beds to rent them out and do well. The smallest place in a beautiful building is going to rent well. But end-users want something larger.
Nick: We definitely saw a huge shift at our last project of people who wanted a one-bed before and who now want a one-bed and den. It’s not a huge shift to three-beds but there is a small shift for sure.
Let’s talk about Melrose.
Nick: Melrose launches at the end of September. It starts in the mid-300s for our studio homes, one-beds in the low 400s, two-beds in the mid-500s, two-beds and dens in the high 600s, and townhomes in the low 800s. The building is 50% 2-bedroom homes.
Melrose is located in the West Village in Surrey. You have schools, shopping and the skytrain at your front door. Surrey’s first big tower boom happened about six years ago so this area is a bit more built up. There’s a city feel to it. It’s the most stylish address in Surrey and will have a great community.
You talked about projects selling out in a single day. What’s the best strategy for someone to have a shot at getting a home?
Cam: Work with a realtor. Whether you’re experienced or just getting into it, you need someone looking out for your best interest. It doesn’t cost anymore so it just makes sense. 99% of our buyers come in through agents and the best agents fight hard for their clients. Access is granted to the top agents who fight to get their clients in first.
The reality is, we escalate prices throughout the launch. When demand is strong, prices escalate. So the buyer with the best agent gets access and gets in early, sometimes when incentives are being offered.
What other projects do you have coming this year?
Nick: We’re relaunching Just West and will be bringing to market another Cambie Corridor townhome project. We have Carven by Kenstone coming to Kerrisdale, which is going to be a gorgeous project. Back in Surrey, we’re also launching Viktor and Flamingo.
What are your predictions for the Vancouver market?
Cam: I am extremely bullish on the market. The things that attract people to Vancouver – fresh mountain air, clean water, great education and healthcare – have always been true and have never been more important than in a post-pandemic world. There’s a new, bigger wave of immigration coming that is going to drive our market further. So I’m telling everyone who will listen to buy now.
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