REDISCOVER REAL ESTATE

Canada among top countries for stable real estate investment: survey

Canada remains a safe bet for investors in the global property game, the results of a new survey from the Association of Foreign Investment in Real Estate (AFIRE) suggest.

As part of its 2016 Foreign Investment Survey, AFIRE asked its 200 worldwide members — which include major real estate owner and developer Oxford Properties Group and a number of Canadian pension funds — what country offers the most stability and security when it comes to real estate investment.

Although just six per cent of respondents chose Canada, that was good enough to earn the country fourth on the list, a spot it has occupied the past three years.

“There were only six countries that even got votes,” James Fetgatter, AFIRE’s CEO, tells BuzzBuzzHome News. Fetgatter explains the question was “open-ended,” therefore respondents could have picked any country. “There’s clearly some interest in Canada because it is such a stable and secure market,” he adds.

The US was by far the most popular choice, however, commanding 60 per cent of all votes, followed by Germany at 19 per cent and the UK at nine per cent. Canada bested Australia’s four per cent and the Netherlands’ two per cent.

Though Canada managed to make the top five once again, its performance falls short of what Fetgatter calls “the significant number” from 2012, when it garnered 18 per cent of the vote and was ranked second. “I think you could probably attribute that to the price of oil, perhaps,” says Fetgatter.

The survey also asked respondents to name their leading cities for real estate investment. Canada was represented here, too, albeit at the bottom. Calgary and Toronto tied in the 27th spot.

Meanwhile, three stateside cities made the top five: New York led all cities, Los Angeles was third, and San Francisco equaled Paris’ fifth-place performance. As it did last year, London occupied the second slot while Berlin became the first German city to crack the top five by placing fourth.

By: Josh Sherman | JANUARY 4, 2016 BUZZBUZZ Home News

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

MARKET UPDATE FOR THE WEEK ENDING JANUARY 1ST, 2015

It’s been a few weeks since we last reported and this being the beginning of a brand new year we wanted to get off to an early AND fresh start. Here’s a recap of what we are all about…Our market insights give you a quick snapshot of what’s happening in the core neighbourhoods of the city. We track listings and sales of homes and condos from the 401 to the lake and stretch as far east as the Beaches and as far west as Bloor West Village. 

 

To truly understand and gauge the temperature of the real estate market in Toronto we scour the data available to us and record key metrics such as the number of properties in various price ranges and how many are being traded at or above the list price. The research is extensive and time consuming but provides our agents and their clients with the knowledge they need to make informed decisions.  Today is the starting point on a year-long journey.

 

In the freehold sector, listings are currently at an all-time low. By comparison, in late May of 2015 we had nearly 500 new listings on the market. Last week we recorded an impossibly low 45. The lack of listings did not deter buyers however. In the week between Christmas and New Year’s Day we recorded 27 sales with just under half of them at or above the list price. In one situation we saw one mid-priced detached home property sell over $200k more than the list price.

 

Not surprisingly, the condominium market is also experiencing low listing activity. Just 153 properties were listed throughout the core of the city last week. A surprising 14% of the 68 condos that sold traded at or above the list price. We are well off the record number of listings that we will see at the height of the market but even with low levels of existing listings there are plenty of opportunities to find excellent end user or investment suites.

 

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

What will it take to rein in Toronto and Vancouver housing prices?

Before the recent federal election, the Liberal Party promised to “undertake a review of escalating home prices in high-priced markets – such as Vancouver and Toronto – to determine whether speculation is driving up the cost of housing and survey the policy tools that could keep home ownership within reach for more Canadians.”

But this may be one of the first promises to fall by the wayside under our new government, judging from Finance Minister Bill Morneau’s recent announcement that Ottawa has no further plans to cool the housing market, despite being concerned about the economic risks of high household debt.

Recent data from B.C.’s Macdonald Realty, one of the country’s largest brokers, shows that 33 per cent of Vancouver’s properties over all – and an astonishing 70 per cent of properties valued over $3-million – are sold to offshore buyers. Bidding wars for selective (mostly single-detached) properties, keep driving prices ever higher, at the expense of middle-class Canadians whose salaries make them unable to compete in the housing market. Today, the average Toronto house cost is 8.2 times the average median income, and it’s a staggering 11.2 times for Vancouver.

The overbuilt condo market seems poised for a nearly immediate correction. The monthly Toronto Condo News magazine recently reported on condo sales in the Yonge North Corridor – the affluent and most densely populated condo community in Canada. Their trending charts show price declines of about $40,000 per unit between the first and third quarters of 2015, with units now taking an average of 35 days to sell, compared with 21 days at the beginning of 2014. >>> read full article

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

MARKET UPDATE FOR THE WEEK ENDING DECEMBER 11TH, 2015

Let’s agree to call the next few weeks the ‘calm before the storm’. Every year, in the days leading up to the Christmas holidays, the Toronto real estate market takes a little breather.

After the biggest year on record in terms of transaction numbers and price appreciation, we feel some rest and relaxation is well earned. Judging by the activity around our offices we know that 2016 will be another strong year. We hope you have enjoyed our weekly market updates and look forward to reporting on Toronto’s downtown core in the new year.

No surprises here. Freehold listings are only about half of what they were two weeks ago and we think it is safe to say that listings will drop again next week too. While sales are falling at roughly the same rate we noticed that demand is still strong as over half the homes traded at or above the list price. Through conversations and meetings with our agents it is evident that most buyers have put their home buying plans on hold until after the holidays.

Condo listings have backed off by 28% over the last few weeks and sales are down by 27%. We believe this orderly decline in both listings and sales indicates that the condo market, while still cyclical, is less prone to the wild swings of the freehold sector. That should come as welcome news to investors and end-users alike. We feel confident in saying that the resale condo market will have another strong year ahead since CMHC’s reported that the price gap between existing and prebuilt condos will narrow further.

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

Finance minister announces down payment rule changes!

New down payment rules will go into effective February 15, 2016.

“The Government’s role in housing is to set and maintain a framework that is equitable, stable and sustainable. The actions taken today prudently address emerging vulnerabilities in certain housing markets, while not overburdening other regions,” Finance Minister Bill Morneau said in a release. “They also rebalance government support for the housing sector to promote long-term stability and balanced economic growth.”

The minimum down payment for new insured mortgages will increase from 5% to 10% for the portion of the house price above $500,000, the finance ministry wrote.

Minimum down payment for properties up to $500,000 will remain at 5%.

The changes are meant to reduce taxpayer exposure while supporting long-term stability of the housing market, according to the ministry.

“This measure will increase homeowner equity, which plays a key role in maintaining a stable and secure housing market and economy over the long term,” Morneau said. “It also protects all homeowners, including many middle class Canadians whose greatest investment is in their homes.”

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

 

MARKET UPDATE FOR THE WEEK ENDING NOVEMBER 27TH, 2015

Last week’s real estate market update could best be described by the simple phrase “no news is good news”. Across the downtown core it appears that while listings are inching lower, there is still plenty of appetite for buying a home. Give it time though. In talking with our agents we know that many buyers are waiting patiently for the spring market. In a few months pent up demand will return and buying a home in Toronto will look like Black Friday at a big box store in the United States.

 

Despite more resale homes coming on the market in the central core, the east and west brought the overall number of listings down by 3% last week. Sales also dropped from 141 units in the previous week to 133 units; however, we are still reporting that over 42% of transactions took place at or above the list price, which is consistent with previous years. There are clear indications that on a year-over-year basis we are still well ahead of 2014.

 

Like the freehold sector, the condominium counterpart is behaving in a similar manner. Listings are down by 12% while sales are down by 7%. That 5% difference reflects the continued health of the condo market in Toronto. Additionally the number of sales at or above the list price has backed off less than 1% from the previous week, coming in at a respectable 19.4%.

 

Bosley Real Estate Ltd. is a full service boutique brokerage operating in Toronto, Niagara-on-the-Lake and Jordan, Ontario since 1928. We have four centrally located offices and over 240 sales representatives selling and leasing homes and condominiums in all the vibrant communities we work in. Our brand is well recognized internationally thanks to our unique affiliation with Leading Real Estate Companies of the World. Our sales teams meet weekly to discuss market conditions, trending topics, and anecdotes that more accurately report on the true temperature of the real estate market.

 

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

Soft landing for the housing market, interest rate rises some way off

The Bank of Canada’s deputy governor Carolyn Wilkins believes the housing market and Canadians’ debt levels are still manageable.

In an interview with the Globe and Mail she said that in line with the bank’s policy reiterated last month: “the housing market and household debt are going to evolve in a constructive way.” Ms. Wilkins pointed to the improving Canadian economy which she says continues to support the hot housing markets of Toronto and Vancouver and will see household debt levels, including mortgages, begin to moderate. The deputy governor said that it is likely to be mid-2017 before Canada’s output would reach full capacity; this should mean that interest rate rises are unlikely during 2016.

Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage.

Source: Canadian real Estate Wealth

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

 

 

 

Unsold condos in the GTA not a sign of higher market volatility: economist

The rising number of unsold condo units in the GTA isn’t what it seems, at least not if you’re one of those who believes growing inventory is a sign of an impending bubble burst.

In commentary published Monday, Canadian Imperial Bank of Commerce economist Benjamin Tal writes “those who look at the rise in unabsorbed units as a sign of increased vulnerability are barking up the wrong tree.”

Sure, Tal notes that an increase in the number of recently completed and as-yet-unsold units typically signals potential trouble ahead for developers. It suggests developers are having a tough go of offloading their merchandise, after all.

Tal also accepts that the number of these lingering unsold units has indeed grown this year. However, he points out an important factor to consider: “Registering a completion is more art than science, as different data providers use different criteria,” said Tal.

While the work of number-crunchers likely won’t be hanging in the AGO anytime soon, there is still a creative element to their activities. Tal points to the Canada Mortgage and Housing Corporation statistics tracking unabsorbed units between December 2014 and this past May as an example.

“The number of unabsorbed units rose from less than 1,000 to close to 3,000,” he writes, noting that exceeds even what was observed during the early-’90s. Then, he highlights a sudden 800-unit monthly drop in June for the number of these unabsorbed abodes, adding, “In absence of an economic shock this kind of volatility is suspicious at best.”

The root of this dates back to 2012, suggests Tal. That year, just under 50,000 homes were started, including nearly 30,000 condos. “When you start, you usually complete,” he said, and that’s where the “art” comes in. CMHC recorded 10,000 completions in January, a “highly abnormal” number, said Tal, and 26,000 in the first half of this year. “CMHC was undercounting in late-2014 and overcounting in early 2015,” Tal tells BuzzBuzzHome News. “That’s why you saw this volatility.”

“I don’t think there is any conspiracy, it’s just a matter of accounting,” he added.

Tal noted that RealNet, a GTA market researcher, spread these completions out for the second half of 2014 to the first half of 2015 in its own analysis. This resulted in 2,000 unabsorbed units being recorded by June. “Clearly higher than it was a year ago, but without the drama,” said Tal in the commentary.

Meanwhile, the number of unabsorbed GTA units isn’t indicative of a widespread trend, the CIBC report goes on to suggest. Rather, a third of all these units are from projects that four developers started, and a quarter of them are from five developments. For context, 77 projects had unabsorbed units in the GTA.

And in some of these cases, it is a matter of developers simply not needing financing from the banks. Tal tells BuzzBuzzHome News that banks typically require 85 per cent pre-sales before they offer financing, but a number of these developers are simply well heeled enough to not need anyone else’s cash. They are building first, marketing later. “If you don’t need the banks… you can do whatever you want,” says Tal.

All of this doesn’t mean the condo market isn’t going to face challenges looking ahead. Echoing a CMHC report released yesterday, Tal cited rising interest rates as something to watch for. That, and a heating up of resale activity causing “excess supply and some downward pressure on prices.”

However, based on Tal’s analysis, the sky isn’t exactly falling at the moment.

Article by: Josh Sherman | OCTOBER 27, 2015 - Photo by: Carlos Pacheco/Flickr

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

No Bank of Canada Rate Change

The Bank of Canada announced today that it is holding its key rate steady at 0.50 per cent noting “the risks around the inflation profile are roughly balanced.

Meanwhile, as financial vulnerabilities in the household sector continue to edge higher, risks to financial stability are evolving as expected.” Taking all of these developments into consideration, the Bank judges the current monetary stimulus remains appropriate.

Looking forward to 2016 and 2017, the Bank’s outlook is positive saying “the positive effects of cheaper energy and broadly accommodative financial conditions should become increasingly evident.”

Great news if you’ve got a variable-rate mortgage, need a new mortgage, are renewing, or want to consolidate debt at the lowest cost funds. The next rate-setting day is December 2nd.

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662

 

Toronto real estate sales in September keep pace toward record

Toronto home sales maintained their heated pace in September, hitting a record number of transactions and seeing prices climb 9.2 per cent from a year earlier.

• Toronto home sales on pace for record year
• Overvalued home prices could put new owners at risk
• Luxury home market running hot and cold, Sotheby's says

 Sales in the Greater Toronto Area rose 2.5 per cent to 8,200 in September, the Toronto Real Estate Board said Monday. That puts it on track for a record in 2015, as mortgage rates remain at or near all-time lows.

 "Barring a drastic shift in the economy over the next three months, total transactions reported by TREB Members in 2015 are expected to be at or near the 100,000 mark," board president Mark McLean said in a release.

 Across the GTA, the average selling price for all type of homes, including condominiums, increased to $627,395 from $574,424 a year earlier. Sales rose to 8,200 from 8,001, the real estate board said.

Adding to the board's florid outlook, it suggested supply is falling behind demand, with the total number of active listings at the end of September remaining below the previous year's level.

"This … suggests that competition between buyers will remain strong as we move into the fourth quarter," said Jason Mercer, the board's director of market analysis.

"Expect strong rates of price growth to continue through the remainder of 2015 and into 2016."

Looking to buy, sell or refinance? Know your options. I can help! Direct line: 416-219-6662