Saturday, February 2, 2019

Toronto new home sales plunge to lowest in almost 20 years as unsold condos pile up

New home buyers finally reached their limit in Toronto last year.

After years of frenzied price increases, sales of new homes in Canada’s biggest city sunk to the lowest in almost two decades in 2018 and the supply of unsold condos piled up, according to a pair of new reports released Friday.
“Greater caution” should be taken when investing in new condo units, particularly over the short-term, as trends point toward slower appreciation, Shaun Hildebrand, president of condo research firm Urbanation, said in the report. The “market has started to normalize after unprecedented activity in recent years.”
Toronto’s housing market is dramatically cooling after higher interest rates and new mortgage regulations bite. The city joins other global metropolises such as London and Sydney seeing a slowdown as international investors retreat and domestic buyers balk at higher prices.
Single-family homes showed the biggest decline, plunging 50 per cent to 3,831 from 2017 and 74 per cent below the 10-year average. Condos sales fell 38 per cent to 21,330, but only 4 per cent below the 10-year average.
While the benchmark price of a new single-family home slumped 6.7 per cent to $1,143,505 in December on the year, condo prices surged 11 per cent to $796,815, according to BILD’s report.
But figures from Urbanation show further weakness building in condos as well. A record 21,991 units are expected to be completed this year, up 29 per cent from 2017. While 98 per cent of those units are pre-sold, more than half were bought by investors who will either rent their units or sell them, the firm said.
The number of unsold units in development jumped 47 per cent in the fourth quarter from the year before to more than a two-year high and price gains for units under development grew only 0.4 per cent between the third and fourth quarters, the smallest quarterly increase in almost three years.
“The slowdown in activity last year can partly be attributed to less demand from investors, who typically represent the largest component of new condominium purchasers,” in the Toronto region, according to Urbanation’s report.
“The market is out of balance,” said David Wilkes, president and chief executive officer of BILD, an industry group for about 1,500 companies in the Toronto region. “We join other industry groups in calling on the federal government to revisit the stress test and allow a longer amortization period for first-time buyers. And we look forward to working with our municipal partners on removing barriers to development such as excessive red tape and outdated bylaws.”

Tuesday, January 8, 2019

Fraser Valley home sales hit 5-year-low last year

Home sales in the Fraser Valley have been above 20,000 for 3 consecutive years but that run was broken in 2018.
Fraser Valley Real Estate Board’s MLS saw 15,586 sales in 2018, down more than 30% from the previous year and the lowest total since 2013. The total dollar value of transactions was down almost $4 billion to $11.8 billion.
Board president John Barbisan says that the figures reflect a return to more normal activity for the market.
“There is still a great deal of interest for Fraser Valley real estate, but with prices moving slowly and more inventory becoming available, many consumers are taking a deliberate approach now that they can afford to,” he said.
New listings hit their fourth highest on record with 32,058 received by the Board’s MLS system in 2018. Barbisan says that sellers need to ensure correct pricing as buyers take control.
Fraser Valley home prices
At $965,300, the Benchmark price for a single family detached home in the Fraser Valley decreased 1.1% compared to November 2018 and decreased 1.5% compared to December 2017.
For townhomes, the benchmark of $531,900, was down 0.2% month-over-month but up 3.7% year-over-year.
The Benchmark price for apartments/condos decreased 1% month-over-month but increased 7.6% year-over-year to $418,300.

by Steve Randall

Friday, January 4, 2019

Metro Vancouver home sales fell to 18-year low in 2018

The weakness of the Metro Vancouver housing market over the past year was highlighted by a report from the region’s real estate board Thursday.
It said that sales for the whole of 2018 were the worst annual total for the region since 2000 and 25% below the 10-year average.
Real Estate Board of Greater Vancouver reported total sales through the MLS for the year reached 24,619, down 31.9% from 2017 and 38.4% below the total for 2016.
“This past year has been a transition period for the Metro Vancouver housing market away from the sellers’ market conditions we experienced in previous years,” Phil Moore, REBGV president said. “High home prices, rising interest rates and new mortgage requirements and taxes all contributed to the market conditions we saw in 2018.”
Weakness continued to the end with December sales down 46.8% year-over-year to 1,072. That’s 33.3% fewer sales than in November 2018.
Downward pressure on prices
The MLS® HPI composite benchmark price for all residential homes in Metro Vancouver ended the year at $1,032,400, down 2.7% from a year earlier. The benchmark for detached homes was down 7.8% year-over-year; it was down 0.6% for apartments; but was up 1.3% for townhomes.
However, over the past 6 months, the drop was 7.3% for detached homes, 6.4% for apartments, and 5.3% for townhomes.
“As the total supply of homes for sale began to accumulate in the spring, we began to see downward pressure on prices across all home types throughout the latter half of the year,” Moore said.
Home listings totaled 53,614 in 2018, down 1.9% year-over-year.
“The supply of homes for sale will be an important indicator to follow in 2019. We’ve had record building activity in recent years and many projects will complete soon. This will provide additional housing options for home buyers across the region,” Moore said.
by Steve Randall

Thursday, December 13, 2018

Rental task force recommends ban on renovictions, not allowing stratas to restrict rentals

The province’s rental task force is calling for an immediate ban on renovictions, a province-wide rent bank for low income British Columbians, and the elimination of a strata corporation’s ability to ban owners from renting out their units.

Renters currently have little recourse once they are told they must leave their unit for the owner to renovate. In some cases renters are forced out for minor upgrades to the home in order for the landlord to put in substantial rent increases.
“One of the most frequently mentioned challenges from renters was unfair evictions, including renovictions and other evictions, based on false claims,” the report reads.
“They told the task force about how stressful it was to live with the constant threat of being forced from their home with too little time to find alternative housing in a challenging rental market.”
The task force found the Residential Tenancy Act needs to be updated to provide clear guidelines on what actions are acceptable during renovations. One of the suggested changes is to allow tenants to remain as long as they are willing to accommodate the renovations.
The task force is also suggesting that evictions should be reserved for the rare instances of serious, major and long-term renovations.
“Many renters called for improvements to the right of first refusal, specifically asking for tenants to be able to return to their units at the same or a similar rent after renovations have been completed,” the report reads.
The task force previously recommended the provincial government change the maximum rent-increase formula. Now landlords are only allowed to increase rent by the rate of inflation and have scrapped the ability of landlords to tack on an additional two per cent annually. The Residential Tenancy Branch can approve “modest rent increases” above inflation.
The task force consulted with renters, landlords, non-profit housing providers and advocates and produced a total of 23 recommendations.
There are 1.5 million renters in British Columbia. The vacancy rate is 1.3 per cent province-wide and, according to the report, below one per cent in Vancouver and Kelowna.
The provincial government has brought in a speculation tax that will punish B.C. homeowners who have multiple properties in affected areas or other Canadians who own property in the province. One of the criticisms of the tax is that it could unfairly punish homeowners who live in stratas where rentals are not allowed.
The government must now review the report but is expected to put in place most, if not all, of the recommendations. The task force consists of NDP MLAs Spencer Chandra Herbert and Ronna-Rae Leonard as well as Green Party MLA Adam Olsen.
“The task force believes that a breakdown in the landlord/renter relationship is often the result of a lack of understanding or a lack of commitment to respecting the rights and responsibilities of each party,” the report reads.
“In some cases, this is deliberate. However, in most cases, this is due to misinformation or lack of knowledge.”
Full list of task force recommendations:
  1. Stop renovictions
  2. Work with local governments to develop tenant compensation and relocation guidelines in the case of demolition of purpose-built rental to reduce dislocation, and homelessness of affected tenants.
  3. Set a clear timeline for a tenant’s decision on the use of a right of first refusal.
  4. Implement a B.C.-wide rent bank system for low-income people.
  5. Strengthen enforcement of the law, including implementing a clear process for making, investigating and reporting administrative penalty complaints.
  6. Strengthen penalties for breaking the law, including refusal of service for outstanding administrative penalties.
  7. Investigate ways to provide affordable access to bailiff services in smaller and more remote communities.
  8. Investigate other options to increase the repayment rate for damages, non-payment of rent and other storage costs if ordered by the residential tenancy branch.
  9. Increase the availability of currently empty strata housing by eliminating a strata corporation’s ability to ban owners from renting their own strata units.
  10. Maintain rent tied to the renter, not the unit.
  11. Work with local governments to develop, implement and enforce short-term rental rules to better protect long-term rental stock.
  12. Make the residential tenancy branch more responsive, accessible and proactive with more opportunities to learn from and educate landlords and renters on their rights and responsibilities.
  13. Improve fairness and consistency of the residential tenancy branch dispute resolution hearings process by recording all hearings.
  14. Improve procedural fairness by expanding review considerations to include more grounds for review.
  15. Require landlords who are filing for eviction for cause, or for renovation, to provide all evidence with any eviction notice to the affected tenants
  16. If repairs are needed to maintain a rental home and the landlord is refusing to make them in a timely way, have the residential tenancy branch proactively reduce the rent of affected tenants until the repairs are completed.
  17. Allow email as a form of notice of service between landlord and tenants.
  18. Speed up the return of damage deposits to tenants by allowing tenants to make a direct request to the residential tenancy branch for the damage deposit where no damage has been found and reported by the landlord.
  19. Work with the insurance industry to see if rent guarantee insurance, and other improvements to insurance coverage, might be provided for landlords in B.C.
  20. Undertake a review to simplify the regulations relating to a landlord’s obligation to store abandoned personal property.
  21. Ensure it is clear for all landlords and renters where to go to get help for all forms of residential tenancy
  22. Address the specific needs of non-profit housing and supportive housing providers in the residential tenancy act.
  23. Ensure manufactured home park rules are clear and understandable. Clarify what occurs when park rules conflict with lease or contract rules.
© 2018 Global News, a division of Corus Entertainment Inc.

Tuesday, November 27, 2018

$1 billion money laundered by crime networks in BC real estate?

Criminal networks could have used British Columbia’s real estate market for more than $1 billion of money laundering.
A secret police report, obtained by Global News, reveals that crime networks are linked to 10% of the 1,200 luxury real estate purchases in the Lower Mainland included in a police study in 2016.
These include a $17 million Shaughnessy mansion owned by a suspected importer of the potent drug Fentanyl.  
Of around 120 properties linked to crime, 95% are believed to have Chinese crime network origins.
Global News own analysis says that the crime networks may have laundered more than $5 billion in Vancouver-area homes since 2012.

Monday, November 5, 2018

Vancouver supply crunch eases

The Real Estate Board of Greater Vancouver says home supply is rising and reaching levels not seen in roughly four years, even as the average price inches up year-over-year.
The board says the composite benchmark price for all homes was $1,062,100 in October _ up one per cent since October 2017, but down 3.3 per cent over the last three months.
Sales of all types of homes _ detached, townhomes and condos _ in October fell 34.9 per cent compared with the same month last year, dropping 26.8 per cent below the 10-year October sales average.
Meanwhile, nearly 4,900 new properties were listed for sale last month, up 7.4 per cent compared with October last year.
Nearly 13,000 homes are listed in Metro Vancouver or 42.1 per cent more than in October 2017.
Board president Phil Moore says the additional supply gives home buyers more choice and home sellers more competition.
Detached home sales fell 32.2 per cent in October compared with the same month last year, while the benchmark price fell to $1,524,000 marking a 5.1 per cent drop year-over-year and 3.9 per cent fall over the last three months.
Sales of townhomes declined 37.5 per cent and condos fell 35.7 per cent year-over-year. The benchmark price for townhomes rose 4.4 per cent from last year to $829,200, while condo prices jumped 5.8 per cent to $683,500. Over the past three months, townhome prices fell 2.8 per cent and condo prices dropped 3.1.
The three-month price drop ``is providing a little relief for those looking to buy compared to the all-time highs we've experienced over the last year,'' says Moore.

The Canadian Press

Friday, November 2, 2018

Vancouver home sales rally in October as prices ebb

VANCOUVER (NEWS 1130) – The long plunge in Vancouver-area home sales is pushing prices slightly lower, driving a sales surge in October.
“Home prices have edged down between three and five per cent, depending on housing type… since June,” says Real Estate Board of Greater Vancouver president Phil Moore.
The realtors’ group says says sales of apartment-style condos, the largest segment of the market, jumped 21 per cent from the previous month to 985. Single-detached houses had a 26 per cent gain to 634 units, while sales of attached properties such as townhouses and duplexes rose 25 per cent to 344. Sales across all categories were still down 35 per cent from the previous October, to 1,966.
Moore adds “The supply of homes for sale today is beginning to return to levels that we haven’t seen… in about four years.”
The sales-to-listings ratio is still low at 10.3 per cent for detached houses, while condos are at 20.6 per cent, which is close to the midpoint for upward or downward pressure on prices.
The board’s adjusted “benchmark” price for a condo is $683,000, down 0.5 per cent from September, 3.1 per cent lower over three months, but 5.8 per cent higher than a year earlier. Single-detached houses averaged $1.5 million, representing a drop of 1.1 per cent in one month, 3.9 per cent in three months and 5.1 per cent lower than the previous October.
Vancouver’s month-over-month sales jump comes despite stricter mortgage qualification rules that have reduced the amount some buyers can borrow and squeezed others out of the market entirely.
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