An aerial view of Kyuquot. (Photo courtesy, Walters Cove Resort)

An aerial view of Kyuquot. (Photo courtesy, Walters Cove Resort)

Coastal B.C. community’s real estate predicament might be turning it into a ghost town

In Kyuquot, off treaty land, more outsiders have ‘holiday-home’ properties than locals who can’t secure financing to buy homes

When schoolteacher Joshua Ogden decided to buy property in the remote B.C. town of Kyuquot, he faced an inconvenient dilemma.

Ogden learned banks were skeptical about providing mortgages to buy property in the tiny community on Vancouver Island’s northwest coast. Banks in Campbell River told him a regular mortgage was impossible. Private lenders, meanwhile, would require a 35 per cent down-payment with a minimum seven per cent interest rate.

Independent mortgage brokers pointed out that no bank or financial institution will lend to a place with limited accessibility. Kyuquot is accessible only by boat or float-plane.

Matt Bruining, manager of Royal Bank of Canada’s Campbell River branch confirmed Ogden’s story.

He said that while the lending policy for the bank is standard throughout the country, there are external factors to be considered if the property is not in a “service area.” Properties that lack easy access to fire-safety services, are examples of what the bank considers a “non-service” area. Insurance, and the cost of maintaining the property are also other criteria that weigh in on the lending decision.

So when a person with a good credit score can’t get a mortgage for a property in such areas, Bruining said the bank is “not declining people, but it is declining the property.”

Ed Handja, is a realtor with BC Oceanfront Properties. In his 25-year career, he has sold six properties in Kyuquot and considers it a “limited market,” meaning properties there can typically take anywhere from two months to two years to sell. Most banks consider that a financial risk not worth taking.

“Banks aren’t really comfortable because they do know enough that if they end up taking a property in foreclosure situation, it could take couple of months or years for them to sell it and they don’t want to get themselves into that situation,” said Handja.

Kyuquot is a vibrant community for four months of the year. However, at other times, outside of the Kyuquot Checleseht First Nation treaty land, it is almost a ghost town. On Walters Island where Ogden lives, most homes are owned by summer residents who use it as a holiday home.

Despite that, Ogden said renting was not easy either.

“Of the properties outside Kyuquot Checleseht First Nation treaty land, majority sit vacant for much of the year – unavailable to rent or purchase,” said Ogden.

Home owners are not comfortable giving out their properties for rent. Donna Holmes Vernon, a home owner on Walters Island who rented her place three times in the past said, landlords who don’t live in Kyuquot face “serious limitations” when it came to maintenance.

First of all, there was always damage done, said Vernon. Secondly, insurance prices and hydro rates on Kyuquot are exorbitantly high.

A lot of “outsiders” have bought property in Kyuquot because they had the money to pay up front said Eric Gorbman, who resides and runs a restaurant on Walters Island. Twenty years ago when Gorbman, an American, bought his property, locals were horrified, he said.

But the trend continued for a while when Kyuquot’s real estate was in demand by the “million-dollar club” of Americans, Vancouver-based tycoons, and out-of-province buyers who “gobbled” up property when it became available.

However, after the 2008 financial crisis in U.S., demand decreased. The owner of one of the last houses sold on Walters Island had to lower his price to the point where he literally had to give it away, said Gorbman.

The dilemma is always going to be a “circular issue,” said Gorbman and added that since locals cannot afford to buy houses, outsiders will continue to buy houses, most of which will be left vacant when they’re not around. He said this is something the provincial government needs to figure out.

“What Kyuquot needs to survive are young families, who can be assets to the community. But if they can’t find places to live, it’s a different thing altogether.”

economy

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

A map released by the BCCDC on Jan. 15 shows the number of new COVID-19 cases reported for each local health area between Jan. 3 and 9. (BCCDC Image)
Salmon Arm and Vernon see increase in new COVID cases, curve flattening elsewhere

The rate of new cases is levelling off in Kelowna, Penticton and Revelstoke.

The Premier Hotel on Summerland’s Main Street and the taxi were owned by Bill and Lydia Johnston. Today, the building is Sass Fashions in Summerland. H.S. Kenyon, who moved the building to Summerland from Midway, continued with building construction. His family now operates Greyback Construction. (Photo courtesy of the Summerland Museum)
Two former Summerland hotel buildings have been moved over the years

Transport of buildings is part of community’s history

Interior Health update. File photo.
86 new COVID-19 cases, two more deaths in Interior Health

The new deaths are from Heritage Square, a long-term care facility in Vernon

Keremeos Village town hall. (File photo)
Second electronic public meeting for Official Community Plan update Feb. 1

The first virtual public meeting was scheduled for Nov. 18

Keith the curious kitten is seen on Nov. 4, 2020 at the Chilliwack SPCA. Friday, Jan. 22, 2021 is Answer Your Cat’s Questions Day. (Jenna Hauck/ Chilliwack Progress file)
Unofficial holidays: Here’s what people are celebrating for the week of Jan. 17 to 23

Answer Your Cat’s Questions Day, Pie Day and International Sweatpants Day are all coming up this week

(Phil McLachlan - Capital News)
‘Targeted’ shooting in Coquitlam leaves woman in hospital

The woman suffered non-life threatening injuries in what police believe to be a targeted shooting Saturday morning

The organizer of a Kelowna protest against COVID-19 restrictions was fined by the RCMP for the third time Saturday, Jan. 16, 2021. (File photo)
COVID-19: Organizer of Kelowna anti-restriction protest ticketed for third time

The individual’s latest ticket for $2,300 was handed out by RCMP at an anti-lockdown rally Saturday

Mount Boucherie Secondary School is one of three Kelowna schools with confirmed cases of COVID-19, according to an update from the school district Saturday, Jan. 16, 2021. (File photo)
COVID-19 confirmed at 3 Kelowna schools

Interior Health has confirmed exposures at Mount Boucherie, Springvalley and South Rutland schools

Half of the most expensive homes are on 2080 Mackenzie Crt, which is across the street from Revelstoke Mountain Resort. (Liam Harrap/Revelstoke Review)
The 10 most valuable homes in Revelstoke for 2020

Combined, the properties are worth more than $35M

Lake Country native Evan-Riley Brown is in the cast for the new film Journey To Royal: A WW II Rescue Mission to be released on video on demand and streaming services on Feb. 2. (Contributed)
Okanagan actor lands role in WW II movie

Evan-Riley Brown, from Lake Country, cast in production labelled as hybrid of a feature film and documentary called Journey To Royal: a WW II Rescue Mission.

JaHyung Lee, “Canada’s oldest senior” at 110 years old, received his first dose of the COVID-19 vaccine on Thursday, Jan. 14, 2021. He lives at Amenida Seniors Community in Newton. (Submitted photo: Amenida Seniors Community)
More than 20 days have passed since the last case of COVID-19 was confirmed at Lakeside Manor. (File photo)
Salmon Arm retirement facility reopens social areas after COVID-19

More than 20 days have passed since last confirmed case at Lakeside Manor

A unique-looking deer has been visiting a Nanoose Bay property with its mother. (Frieda Van der Ree photo)
A deer with 3 ears? Unique animal routinely visits B.C. property

Experts say interesting look may be result of an injury rather than an odd birth defect

Most Read