Developer blames construction delays, not U.S. election controversy

Dan Fumano
The Vancouver Sun

The opening of the Trump International Hotel and Tower in downtown Vancouver has been delayed until at least January.

The hotel’s opening, originally scheduled for summer and then fall of 2016, has been postponed again because of construction delays, said Philipp Posch, general manager of the Trump International Hotel Vancouver.

“It’s just a question of time and labour and getting enough workers in here to get this done,” Posch said. “The product is just not finished. We think we’ll be done some time in late November with construction, and then we still have to do our four weeks of training.”

The project, which includes a hotel and 214 luxury condominiums, has attracted controversy since last year because of U.S. businessman-turned-presidential candidate Donald Trump. Since launching his campaign last year, Trump, the Republican nominee for president, has been involved in a series of scandals and controversies involving everything from his political positions, his past business dealings, to his personal conduct.

Asked if the hotel’s rescheduled opening date had anything to do with the upcoming U.S. election on Nov. 8, Posch said: “No, absolutely not.”

The hotel will include a poolside lounge, a champagne room, a spa and a restaurant, all of which are expected to open at the same time early next year. Residents are expected to start moving into the condos within the next month, Posch said.

The Trump International Hotel and Tower, described on its website as “Vancouver’s most anticipated hotel and residences,” is being developed by Vancouver-based firm Holborn Group.

More than half of Canadians said they would like to see Trump’s name removed from the project, according to an Angus Reid poll from late last year. Many prominent Vancouverites have called for the removal of the name, including Mayor Gregor Robertson, who said last December that the Trump name was at odds with Vancouver’s “steadfast commitment to diversity, equality, and freedom from discrimination and hatred.”

At that time, the company released a statement saying: “Holborn, a company that has contributed immensely to the growth of Vancouver, is not in any way involved in U.S. politics. As such, we would not comment further on Mr. Trump’s personal or political agenda, nor any political issues, local or foreign. Our efforts remain focused on the construction of what will soon be the finest luxury property in Vancouver and beyond.”

Since that time, Holborn’s representatives have not indicated any intention of dropping the Trump name.

Holborn owns the hotel and pays the Trump Organization a management fee, said Posch.

© 2016 Postmedia Network Inc.

Ephraim Vecina
REP

Vancouver’s cripplingly high home prices along with recent changes to regulations governing Canadian mortgages will limit millennials’ prospects of buying and owning homes—and in turn affect the national economy in the long term.

Housing policy expert Duncan MacLennan said that Canada’s real estate troubles have long passed the point of just being a human rights issue.

“We’ve got to stop thinking of housing simply as some kind of social service, but recognize that it’s a key thing to get right for any metropolitan area that wants to be a great city — and that’s what Vancouver is,” MacLennan told the Vancouver Sun.

The economist added that compounding the problem is that millennials aren’t as fortunate as previous generations, which have had decades to settle their mortgages in a more favorable fiscal environment.

“If [millennials] don’t become homeowners until they’re 40, the point at which they can pay for these other things really gets pushed further into the distance, so that I think it will have a potentially negative effect on savings by Canadian households in that time, and also on consumption,” MacLennan stated.

“The first measures that have been undertaken recently to cool the housing market in Vancouver and Toronto by being more restrictive in the ability to take out mortgages, I think actually they act against the interest of younger people and make it more difficult for them to take out a mortgage while interest rates are still low.”

These projections mirrored those of the B.C. Real Estate Association, which said earlier this week that millennials might lose as much as 1/5th of their purchasing power under the new rules.

The latest round of federal measures, which are scheduled to take effect on October 17, has led to widespread fears of less market activity, as the regulatory changes will mandate all insured mortgages with less than 20 per cent down payment to qualify at a higher rate bracket.

 Copyright © 2016 Key Media Pty Ltd

Justin da Rosa
REP

The new mortgage rules and they implications they will have on homebuyers are nothing to seasoned agents, according to one veteran who believes savvy professionals will continue to find success.

“In the aftermath of the first 24-48 hours, after the federal government introduced the legislation, there was a lot of doom and gloom predicted. Particularly from the mortgage industry; people talking about markets tumbling, talking about lenders going out of business,” Phil Soper, president of Royal LePage, told REP. “Less than two weeks later, I think a sense of proportion has returned to the market and people realize that all the parties to the housing industry — the realtor, the mortgage broker, the lender, and importantly, the homebuyer — are resilient and resourceful.”

The liberal government announced a number of mortgage rule changes in early October. The industry scrambled to figure out just what sort of impact it would have on housing markets, homebuyers and, indeed, agents.

Initial sentiment was largely negative – especially about a mortgage stress test that would require homebuyers with high ratio mortgages to qualify at the Bank of Canada benchmark five-year rate, which would lower the mortgage amount a buyer would qualify for.

But these new rules provide ample opportunity for agents to school their clients and establish themselves as experts.

“[Buyers] will adjust to the new rules and find a way to get their new home. Someone doesn’t stop wanting a house just because the rules change,” Soper said. “So the message to realtors: It’s important to explain what the changes mean to someone and if they were going to borrow to the maximum of the ability, that they might not be able to do so.

“[Agents] may be surprised; some of the rhetoric vastly overstated the way in which people would be forced out of the market,” he continued. “It’s important for realtors to understand the implications of what property people will be able to afford and adjust appropriately. This is nothing new for a seasoned realtor.”

Copyright © 2016 Key Media Pty Ltd

Mortgage Broker News

The Canadian Real Estate Association says the number of home sales edged higher in September compared with August, ending a streak of month-over-month decreases.

Sales through the association’s Multiple Listing Service were up 0.8 per cent nationally last month compared with August.

Sales were up in the Toronto region were up, while they continued to fall in and around British Columbia’s Lower Mainland region, which includes Vancouver.

“The Finance Minister’s recent changes to regulations affecting mortgage lending has added to housing market uncertainty among buyers and sellers,” said CREA President Cliff Iverson. “For first-time home buyers, the stress test for those who need mortgage default insurance will cause them to rethink how much home they can afford to buy.”

CREA has concerns that first-time buyers will be priced out of certain markets.

“First-time home buyers, particularly in housing markets with a lack of affordable inventory of single family homes, may be priced out of the market by the new regulations that take effect on October 17th,” said Gregory Klump, CREA’s Chief Economist. “First-time home buyers support a cascade of other homes changing hands, making them the linchpin of the housing market. The federal government will no doubt want to monitor the effect of new regulations on the many varied housing markets across Canada and on the economy, particularly given the uncertain outlook for other private sector engines of economic growth.”

Compared with a year ago, the number of home sales was up 4.2 per cent from September 2015.

The national average price for a home sold in September was up 9.5 per cent compared with a year ago at $474,590.

Excluding the expensive Greater Vancouver and Greater Toronto regions, the average price was $358,884 last month.

Copyright © 2016 Key Media Pty Ltd

BC Home Sales Reflect Regional Demand Variations

BCREA
other

The British Columbia Real Estate Association (BCREA) reports that 7,591 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in September, down 11.2 per cent from the same month last year. Total sales dollar volume was $4.45 billion in September, down 14.1 per cent compared to the previous year. The average MLS® residential price in the province was $585,844, a decline of 3.2 per cent compared to the same month last year.

“Housing demand in the province continued to trend lower in September,” said Cameron Muir, BCREA Chief Economist. “While Vancouver, Fraser Valley and the North experienced year-over-year declines last month, the rest of the province posted an increase in the number of residential transactions.”

“The average residential price in the province continued to reflect a change in the composition and location of homes sold,” added Muir. “However, the effect was less pronounced in September than in August, when detached home sales fell to just 28 per cent of total demand in Vancouver.”

Year-to-date, BC residential sales dollar volume increased 33.5 per cent to $66 billion, when compared with the same period in 2015. Residential unit sales climbed by 18.5 per cent to 93,797 units, while the average MLS® residential price was up 12.7 per cent to $703,986.

Copyright ©2016 BCREA

SQUAMISH?S NEWEST TOWNHOUSE COMMUNITY HOLDS GRAND OPENING THIS SATURDAY

The Province

BREEZE

WHAT: 60 Westcoast Contemporary 3-bedroom townhomes featuring private rooftop sky lounges with mind-blowing views. And 12 2-bedroom Loft Homes with 17-foot ceilings.

WHERE: 39971 Government Rd., Squamish

During the 2010 Olympics, Squamish served as a beautiful drive-through, where athletes, officials and spectators fueled up with gas and coffee on their way up the Sea to Sky Highway to Whistler.

With that unique and unprecedented global exposure, ‘locals’ got to work envisioning a new and different community, one that consumes you rather than you consuming it.

Paramount to this vision is the distinctive lure of the area’s year-round, beautiful and naturally invigorating surroundings.

Town planners recognized that the best way to enjoy that overwhelming natural beauty is to incorporate it into residents’ daily living.

Great examples of this include a number of residential developments from Target Homes, including Current, Abby Lane and the all-new BREEZE.

BREEZE is Squamish’s newest townhome community, featuring 60 Westcoast Contemporary-style 3-Bedroom townhomes designed with views to take advantage of the amazing scenery. There’s also 12 2-bedroom Loft Homes with 17-foot ceilings.

And it’s far from the only new development going on in the area.

Garibaldi at Squamish is a $2-billion (estimated) mega-project that would add 20,000 beds to the community in a size similar to Whistler Village.

Then there’s the proposed Great Wolf Lodge, a $300-million water park resort that would create more tourism jobs to the already explosive and key local economic driver.

Research and education is also receiving a boost with UBC’s Green Energy Research Centre expected to be up and running within two years. That will join the highly acclaimed Quest University, considered by many to be the best post-secondary institution in British Columbia. Not surprisingly, students from around the world are easily enticed to learn and live in Squamish.

Developers like Target Homes realize that Squamish currently lacks new residential options for locals and investors to purchase.

The recent announcement of the new 15 per cent foreign buyers tax by the BC government, which took effect on August 2, has already had consequences on the Greater Vancouver real estate market, but not in Squamish.

The new tax does not apply to Squamish, which makes it an even more attractive area for investors or adventurous, active British Columbians to buy a new home.

© 2016 Postmedia Network Inc

Bob deWit
The Province

A commonly shared wisdom among all levels of government and industry is that it’s critically important to protect the interests of first-time homebuyers and those at the lower end of the real estate home ownership ladder.

Home ownership is a good thing: It would be hard to find anyone to argue with that. That’s why I was surprised to see a policy announcement from our federal government that, although seemingly subtle, will have a huge impact on the ability of entry-level buyers to own a home or move up in the market.

On Oct. 3, Finance Minister Bill Morneau announced a series of proposed changes to federal policies and legislation affecting mortgage loan insurance, mortgage lending rules and tax treatment of capital gains from principal residences for foreign buyers.

Of particular concern is the “stress test,” whereby all insured homebuyers must qualify for a mortgage at the Bank of Canada’s conventional five-year fixed posted rate, which is significantly higher than actual rates.

This will dramatically reduce the mortgage amounts available to buyers, locking out many first-time buyers trying to buy entry-level units and potentially disqualifying buyers who have already qualified, but not yet secured their mortgage. Conventional mortgages will also be affected by new portfolio insurance rules and this will further impact the market, although the extent of these impacts remains unclear.

The Canadian Home Builders’ Association — of which the organization I lead is affiliated — has just released a study on the impacts of the measures, which estimates that one-quarter to one-third of first-time buyers could be removed from the market and that the measures overall will reduce housing activity by six to 10 per cent. This is obviously a serious concern.

Preventing home ownership is a politically risky move, not to mention economically reckless. If the government persists with these measures and the reduced demand translates to fewer homes built, the economic impact of a 10 per cent reduction in housing activity is worth roughly $6 billion in GDP.

Sometimes the seemingly smallest changes can have the biggest impact.

Let’s hope the federal government reconsiders their direction on this one. To make sure they do, don’t be shy about letting your feelings known to your local member of parliament.

© 2016 Postmedia Network Inc.

Colourful touches give depth to Parker House design

Mary Frances Hill
The Province

Parker House at Windsor Gate

Where: 1151 Windsor Mews, Coquitlam

Developer and builder: Polygon Parker House Ltd. and Polygon Windsor Gate Ltd.

What: 131 apartment residences in two buildings

Residence sizes and prices: two-bedrooms and two-bedrooms plus flex; 860 — 1,165 square feet; from $429,900

Sales office: 1151 Windsor Mews

Sales office hours: noon — 6 p.m., Sat — Thurs

At Parker House, Polygon’s new community in Coquitlam’s Windsor Gate development, the company’s designers show the potential of decorating in living colour.
While many designers relegate colour to a minimum — say, a pillow or accessory in bright colours — the Polygon team uses sophisticated shades as an essential part of décor.
In one show home, the living room stands as a testament to the art of enlivening a room with a soft, disciplined palette. Working with a strong foundation — specifically, all-white walls and an all-white sectional sofa against two huge windows — Evan Coltart and Polygon’s designers punctuated the room with large abstract works of art in muted oranges, gold and blue.
“Keeping the main elements neutral allowed us to be more bold with the artwork and accessories. The cool blues were West Coast inspired, and the gold acted to balance and warm the space,” Coltart says.
Accents in the dining area and in the wall unit reflect the hues in the artwork.
It takes courage to bring in striking colour, particularly in a large, dominant piece, like the two that define the living room. It’s common among designers to keep to straight neutrals and use pillows, throws or vases to add “pops” of primary, and temporary colour. Though bright or primary hues may attract attention in a monotone space, they can get overwhelming over a period of time, Coltart adds.
“I think people are often afraid of making a bold colour choice for fear of tiring of it after a short time.”
The Polygon team plays with the alternative to dominant colour in one bedroom, where various neutral shades evident in a tufted headboard that nearly reaches ceiling height, in a formal chair and side tables, belong in the same cream and beige colour family. On one hand, the similar shades bring a sense of peace in a room where serenity is needed most. On the other, every texture adds a new layer of interest.
Layering textures within a more monochromatic scheme helps to add depth and richness to space without overpowering it, Coltart explains.
While colour, depth and texture define one suite, the other is marked by a more traditional layout and feel, “with a more mature demographic in mind”, he says.
Celia Dawson, Polygon’s senior vice-president of interior design, says those traditional touches “give a space that custom high-end feel: timeless, elegant and worldly.
“I think this appeals to many clients, whether they truly fit this definition and look or if they just aspire to fit to this look.”

© 2016 Postmedia Network Inc.

Home price growth in third quarter likely to be followed by slowdown, easing affordability pressures, says quarterly Royal LePage House Price Survey

Joannah Connolly
REW

Quoted in the quarterly Royal LePage House Price Survey, Soper added, “Our widely followed house price composite showed that the median value of homes in the tiny West Vancouver suburb increased by nearly 40 per cent – or an astonishing million dollars – year-over-year.

“That said, relief appears to be on the way. For months, the number of homes trading hands has been slowing on eroding affordability. And, slower sales volumes lead to moderating prices.”

The report also examined the effect of the BC government’s new tax on foreign buyers of Metro Vancouver real estate. It said, “The Government of British Columbia’s new 15 per cent property transfer surtax on foreign nationals and foreign-controlled corporations, introduced early in the quarter, has contributed to slower sales activity but has had little impact to-date on Greater Vancouver home prices.”

Royal LePage criticized the proposed introduction of the new vacancy tax in Vancouver, suggesting that it would be unfair to add another levy onto owners of such homes when they already pay property tax.

The report said, “This second tax would be especially punitive, given that property taxes pay for services those homeowners do not use, such as schools, public transit and waste removal services.”

However, the brokerage observed that demand for Vancouver housing would remain high even “in the face of regulatory headwinds.”

Soper said, “Vancouver continues to attract foreign interest, and we do not expect to see an automatic migration of capital to Toronto in the wake of the new tax imposed in Metro Vancouver.

“It is important to remember that most people buy houses for the location, lifestyle and family needs, and not simply upon financial investment criteria.”

Across the country, the report said that price growth remains strong, with most markets increasing prices steadily but not too quickly and even resource-dependent provinces only seeing small declines, said the report.

“Nationally, our real estate markets remain healthy, with home values showing modest to strong (yet rational) price appreciation in almost every Canadian city,” said Soper. “Even in the hardest hit oil patch regions, prices have held up well, with small single-digit declines, year-over-year.”

The report asserted that the federal government’s latest measures to cool the national housing market by tightening mortgage qualification rules will not damage the market as much as many have feared.

“Consumer confidence suffered a direct hit when the federal government introduced new, more restrictive regulations in early October,” said Soper. “While it is too early to say definitively, it appears Canadian homebuyers are adjusting quickly, and that fears of a hard correction were unwarranted. While the changes are significant, major lenders may already be using similar criteria when writing mortgages in sensitive regions like Alberta and BC, so the additional drag on the market resulting from the new legislation won’t be as great as it appears on the surface.”

© 2016 Real Estate Weekly