Remote work and online sales received a boost during the pandemic and led to changes in how real estate was sold. Virtual tours and remote signing became options for many buyers as the industry pivoted to address the new environment.
But for developers, the traditional display suite remains the cornerstone of sales efforts, providing a physical, tangible encounter with what a future home will be like.
“It’s proven. You can’t debate that it works,” said Hani Lammam, executive vice-president, Cressey Development Group, of traditional presentation suites. “My perspective is that this is such a big decision, you want to be able to touch it and feel it. This is a big investment for people.”
Cressey has never used virtual reality to sell homes, and Lammam doesn’t expect to use it while buyers are still wanting to tour presentation centres.
But since 2016, Stambol Studios of Vancouver has been creating virtual environments for developers from architectural plans to help buyers visualize and understand a potential purchase.
“We basically take [the architect’s plans], turn them into incredibly realistic renderings of the buildings with all the elements that make a building sellable,” said Dogu Taskiran, CEO of Stambol. “If they have a virtual reality headset attached to a mobile device or a computer, then they can get into these units and walk into them as if they are already built.”
Its clients include Etro Construction Ltd., for which it rendered the Turner Dairy project at 17th Avenue and Ontario Street in Vancouver. Visitors could don a VR headset and see what the townhomes planned for the site would look like even before the century-old dairy on the site was demolished.
Stambol also worked with Lark Group of Surrey to create a virtual experience within a job site trailer rather than build out a full presentation suite for an 18-unit condo development on Semiahmoo Spit in Blaine, Washington.
“They could also use the same material to send to their overseas investors or embed it on their website and then use it on social media,” Taskiran said. “One stone gets 50 birds, really.”
This is cost-effective, both because of the reach and the material costs involved. A single suite in a display centre can cost $250,000; building out and furnishing a full home can be many times more.
“Most developers spend up to $2 million to create that and it’s throw-away work, it’s not eco-friendly,” Taskiran said. “This, less than $50,000 will give you one three-bedroom apartment.”
The cost savings appeal to Joey Coupland, vice-president, sales with Wesgroup Properties LP, which uses augmented images to save on material costs.
“Building a presentation centre and a show suite is always expensive, so we’re always considering another option or another tool we could use to display our homes or our product,” she said.
Virtual staging – augmenting pictures of real homes with imagery of furniture – has been the most common practice to date.
“It’s significantly less than buying the furniture and staging [the home],” she says.
But when it comes to a full-on virtual option, she says the physical experience wins every time.
“It’s not the preferred experience we want to create for our homeowners, so we’re always building our show suites,” she said. “We see the benefit in the homeowners coming through and touching and feeling the materials, seeing the attention to detail.”
But as the technology evolves, project marketers like Ryan Lalonde see things changing. Stambol’s creation of virtual realities that people can enter in a presentation suite may well become the sort of environment people will experience from home. This could allow them to shop properties, allowing them to compare homes, or commercial space, without ever going to the physical site.
“Virtual reality is an immersive experience that is … going to unlock and remove some of the roadblocks and the hurdles that they feel in purchasing real estate,” he said.
Parallel reality
However, it could also create spaces people could inhabit parallel to real life, something he sees changing how people socialize. Rather than go to a restaurant or gather at home, people would enter a virtual restaurant space from their living rooms.
This is already the reality at Stambol Studios, where staff collaborate remotely through their headsets.
“Our entire team is actually doing virtual work, together, as if they’re in the same office,” Taskiran said. “You can turn right and talk to that person, turn left and talk to that person.”
On March 21, Stambol launched Order in Box, a marketplace for non-fungible tokens (NFTs) to handle trade in the digital certificates of ownership attached to such environments.
“You will be able to buy a virtual home, paying for it in cryptocurrency and get an NFT for it,” he said. “That will be your record of ownership, then you can get into it and live in it through virtual reality.”
The home’s furnishings and artwork would have NFTs, too. It could sit on virtual land represented by an NFT.
“People gathering around the same asset is what makes something valuable,” he said. “You build up value that way and I’ve known many developers who have virtual real estate now.”
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
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