Zillow has added three more brokerages to its growing real estate venture in Canada

REP

Online real estate marketplace Zillow has announced new marketing partnerships with three leading Canadian brokerages, less than a week after cementing a major data-sharing deal with RE/MAX Ultimate Realty Inc. in Toronto.

With the addition of Better Homes and Gardens Real Estate Signature Service, Core Assets Real Estate, and Greater Property Group to its list of affiliates, Zillow now has commitments with 7 major Canadian firms.

“With every Canadian partnership we build, the experience on Zillow will get better for everyone – from brokerages and agents to the millions of home sellers and buyers who visit Zillow every month,” Zillow Group chief industry development officer Errol Samuelson said.

 “We believe there’s a massive opportunity ahead to help connect Canadian real estate professionals and their listings with Zillow’s audience, and we’re thrilled by the interest we’ve received from our partners and their members around Zillow’s plans for Canada,” Samuelson added.

All in all, more than 30,000 for-sale listings across the country have now become accessible to Zillow’s roughly 186 million average monthly users in North America.

Copyright © 2018 Key Media Pty Ltd

Vancouver commercial project to significantly pump up supply

Ephraim Vecina
Canadian Real Estate Wealth

Oxford Properties Group announced late last week the beginning of the development of The Stack, a high-rise office tower that will be injecting 540,000 square feet into Vancouver – a much needed volume in a market characterized by a rock-bottom commercial vacancy rate of 4.7%, the second lowest in North America as of Q2 2018.

The 530-foot AAA class development situated at 1133 Melville in the downtown core would be Vancouver’s tallest commercial tower to date.

“With The Stack now launched, we’re adding significant and much-needed new supply to Vancouver’s extremely tight office market and to accommodate the city’s economic growth,” Oxford’s vice president of office Chuck We said.

“The Stack is one of the most-forward thinking office projects in Vancouver. Not only does it break new ground by incorporating employee wellness into the fabric of its design through its use of natural light, outdoor space and cycling amenities, we’re future-proofing the building with the adoption of Smart Building technology and multi-modal transportation options,” We added.

A recent report by CBRE Ltd. pointed at Vancouver as one of the country’s strongest commercial market, with Q2 2018 investment deals reaching a total of $3.2 billion.

The volume was spurred by activity involving Vancouver-based Pure Industrial Real Estate Trust, which – together with Canadian REIT – accounted for almost half of the $16.5 billion national commercial investment volume in that quarter.

A growing number of suburban office deals, along with a major purchase of Investors Group’s nine office properties in Metro Vancouver, also helped propel the market’s exceptional performance.

Copyright © 2018 Key Media Pty Ltd

Sold data coming to Realtor.ca

REM

CREA’s Board of Directors has voted to add sold and historical data to the property listings on Realtor.ca without the need for a login.

In a message to real estate boards across the country, CREA says the move comes “in order to meet consumer demand and at the request of Realtors and boards.”

It says, “In addition to responding to requests from members, this will ensure we continue to offer leading edge services on the best real estate website in Canada.”

A Competition Tribunal decision in July 2016 found that by not including sold and other data in its VOW feed to members, TREB had engaged in anti-competitive acts. An appeal court upheld the decision and on Aug. 23 of this year, the Supreme Court of Canada announced that it would not hear TREB’s appeal. CREA supported TREB at the tribunal and had intervenor status in the proceedings.

TREB is now supplying the disputed data to its member VOWs.

CREA media relations officer Pierre Leduc says that before the sold data can be displayed on Realtor.ca, each real estate board must request that the information be added. CREA will then work with the boards, the provincial associations and the regulators to ensure that it complies with all laws and regulations.

“We’ll have to check with the boards to see what historic sold data they have access to, and how far back that data will go,” says Leduc.

Only historic sold prices will be posted and not pending solds, he says. Pending solds were part of the Competition Tribunal order for VOWs, but consumers and Realtors are concerned about privacy issues on deals that have yet to close.

Leduc says CREA hopes to have the sold data rolled out on Realtor.ca as soon as possible.

© 2017 REM Real Estate Magazine

No flurry of fall activity this year, as slide in both sales and prices gathers pace across Metro Vancouver

Joannah Connolly
Western Investor

September is usually the month that we’d expect to see residential real estate activity start to pick up after a summer break – but there’s no sign of that this year, new statistics from the Real Estate Board of Greater Vancouver reveal.

There were just 1,595 home sales in Metro Vancouver in September 2018, which is a dramatic 43.5 per cent decrease from the 2,821 sales in September 2017, and an even more surprising 17.3 per cent month-over-month drop since August this year.

The total is also 36.1 per cent below the 10-year average number of home sales for September.

The numbers certainly place a question mark over the B.C. Real Estate Association‘s recent assertion that the slowdown in sales across the province so far this year is “largely behind us” and that activity is likely to pick up this fall. Those numbers were soon contradicted by the Canadian Real Estate Association, which predicted slower sales in B.C. this fall.

Metro Vancouver’s lack of sales activity in September has pushed the number of homes for sale on the MLS in the region to 13,084, which is a 38.2 per cent rise over September 2017, and up 10.7 per cent from August 2018.

Overall, that puts Metro Vancouver real estate into a balanced market, but rapidly moving towards a buyer’s market, with a sales-to-active listings ratio of 12.2 per cent (a balanced market is 12 to 20 per cent over a sustained period). The region’s detached homes are already in a stronger buyer’s market at just 7.8 per cent, with more balanced markets for townhomes at 14 per cent, and condos at 17.6 per cent.

The slowdown has seen benchmark prices continue to slide off their peak earlier this year, with the composite benchmark home price now just 2.2 per cent higher than in September 2017. The current composite benchmark of $1,070,600 is 3.1 per cent lower than three months ago.

Ashley Smith, REBGV’s new president-elect, said, “Fewer home sales are allowing listings to accumulate and prices to ease across the Metro Vancouver housing market. There’s more selection for home buyers to choose from today. Since spring, home listing totals have risen to levels we haven’t seen in our market in four years.”

Sales and prices by property type and region

After many months of market activity deeply divided by property type, townhomes and condos seem to be finally succumbing to the sales slowdown that has dogged the detached home sector over the past year or so. However, with attached property trends trailing those of the single-family home, their prices have not yet seen the same declines.

Just 508 single-family homes traded hands across Metro Vancouver in September, which is a 40.4 per cent drop from one year previously, and down 11 per cent from August. The benchmark price for detached properties is $1,540,900, which is a 4.5 per cent decrease from September 2017 – the only property type to see prices lower than a year ago – and a drop of 3.4 per cent in three months.

The worst-hit areas for value declines in the detached sector were West Vancouver, where benchmark prices are down 11.4 per cent year over year, and Vancouver West, down 10.9 per cent. Detached prices in Maple Ridge, Whistler, Pitt Meadows, Sunshine Coast, Squamish, Bowen Island and the Tri-Cities remain higher than a year ago – although homes in even these resilient areas are off their spring peak prices.

Townhome activity saw the biggest annual slump, with a mere 275 sales in September, which is a whopping 46.9 per cent lower than September 2017, and a slide of more than 18 per cent from August. The price of a typical townhome (or similar attached property) in the region is now $837,600, which is still 6.4 per cent higher than September 2017, but a two per cent drop over the last three months.

Vancouver West – which includes the West Side, Downtown West and the West End – was the only area to see townhome prices lower than one year ago, down 2.8 per cent year over year and nearly six per cent lower than three months ago. Burnaby is bucking the trend, with its three areas of North, South and East seeing annual price increases in the townhome sector between 9.5 and 12.9 per cent.

After a long reign as the most resilient sector, condos are now suffering a similar fate, with a 44 per cent annual drop in sales, at 812 units in September. That’s the steepest month-over-month activity decline, down more than 20 per cent from August’s condo sales. Benchmark prices have also continued to fall off the peak seen in the spring for this home type.

The price of a typical Metro Vancouver condo is now pegged at $687,300, which is a 7.4 per cent increase from September 2017 and a 3.1 per cent decrease over the last three months. Once more, however, this varies hugely depending on your local market.

Although Whistler is leading the pack for single-family home prices, it was the only area in the Greater Vancouver board’s jurisdiction to see an annual price decline in its condo market, with the benchmark price one per cent lower than a year ago and an eyebrow-raising 10.1 per cent lower than its peak price earlier this year. Vancouver West didn’t do much better, with condo prices up only one per cent since last September, and down 5.6 per cent in the past three months.

Home prices vary widely in different areas throughout the region. To get a good idea of home prices in a specific location and by property type, check the detailed MLS® Home Price Index in the full REBGV stats package.

Copyright © 2018 Western Investor

Economists says risks in the housing market remain

Greg Quinn, Jacqueline Thorpe and Erik Hertzberg
Canadian Real Estate Wealth

Canada’s economy faces a major risk through the next three years from how debt-laden consumers cope with higher interest rates, according to economists from three of the country’s largest financial institutions.

Risks in the housing market remain, even after the slowdown in sales earlier this year after the government imposed new regulations, according to Frances Donald, head of macroeconomic strategy at Manulife Asset Management. Consumers still have to prove they can be resilient to higher interest rates, Donald said Tuesday at the Bloomberg Canadian Fixed Income Conference in New York.

“This is something that we are going to have to deal with for several years,” she said.

Consumers no longer have the capacity to lead Canada through another recession the way they did after the global financial crisis a decade ago, said Beata Caranci, chief economist at Toronto-Dominion Bank. While Canada’s fastest population growth in decades provides some support to demand for housing, high debt levels remain a problem that could exacerbate the next recession, she said.

Next Recession

Past 2020, “it’s really going to hit the fan,” Caranci said. “At that point you have high level of indebtedness combined with income stress happening simultaneously. So we are definitely not out of the woods.”

The next recession for Canada will be different than the previous because it will be “a household led recession,” Caranci said.

The risks around consumer finances will lead the Bank of Canada to remain cautious about raising interest rates, said Stefane Marion, chief economist at National Bank of Canada. The central bank will re-assess its path after moving the policy rate to 2 percent, he said, adding that will help avoid a consumer-led downturn. “I don’t see an accident waiting to happen in the housing sector,” Marion said.

U.S. 10-year Treasury bond yields could rise towards 3.5 percent in a time of government deficits and tightening by the Federal Reserve, Marion said, something that will be felt in Canada and its mortgage rates, Marion said.

All three economists said that the risks of higher interest rates will be felt more around 2020. Many mortgage borrowers have fixed-rate loans for terms of up to five years, meaning rate increases over the past year won’t affect their payments for a while.

Additional global risks include potential for a U.S. slowdown or recession in the next few years and trade tensions between the U.S. and China, Donald said. 

Copyright Bloomberg News

Copyright © 2018 Key Media Pty Ltd

Greater Vancouver will be in a ?buyer?s market? within a few months

Daniel Tencer
other

It’s safe to say Vancouver real estate has entered a new era, and it’s nothing like the old one. After a dismal summer, things appear to be headed for an even worse autumn.

The city’s sales slump deepened in September, with home resales dropping by 17.3 per cent from August, and down 43.5 per cent from the same month a year earlier, new data released Tuesday shows.

With unsold listings piling up, the supply of homes for sale is spiking, putting downward pressure on prices, which are now falling all categories, and in most areas of British Columbia’s Lower Mainland.

“Metro Vancouver’s housing market has changed pace compared to the last few years,” Real Estate Board of Greater Vancouver (REBGV) president-elect Ashley Smith said in a statement.

“Our townhome and apartment markets are sitting in balanced market territory and our detached home market remains in a clear buyers’ market.”

But townhomes and condos may not remain in “balanced territory” for long. The sales-to-active-listings ratio — a closely watched measure of market balance — has dropped precipitously for both housing types since the start of the year.

There are now only 14 townhomes selling every month for every 100 available, down from around 35 per 100 in the early months of the year. For condos, sales have dropped to 17.6 per 100, from around 60 per 100 at the start of the year.

The REBGV considers any level below 12 to be a “buyer’s market,” and any level above 20 a “seller’s market.”

With eight sales per 100 available homes, detached houses have been in a “buyer’s market” for some time. But if current trends continue for just a few more months, all the residential real estate in Greater Vancouver will be in a “buyer’s market.”

The benchmark price for a detached home in Greater Vancouver is down 4 per cent in the past six months, to $1.54 million.

Prices have turned negative for townhomes and condos as well, which until recently were still hot segments of the region’s market.

Condos are down 1.5 per cent in the past six months, to $687,300, while townhomes are still up from six months ago, but started falling in the past three months, to $837,600 this month.

But prices haven’t fallen enough to do much to improve home affordability, and rising mortgage rates are instead making things worse. Home ownership costs in Vancouver are at their worst levels ever recorded, Royal Bank of Canada said in a report last week.

That stands in stark contrast to Toronto’s housing market, which has seen a pick-up in activity in recent months, prompting observers to declare that the city’s correction is over, and a rebound is on the way.

A global trend?

In its latest Housing Bubble Index, released last week, Swiss bank UBS named Toronto and Vancouver the cities with the third and fourth highest risk of a housing bubble burst, respectively.

The bank’s economists noted that bubbled-up housing markets all over the world — from Sydney to London to Hong Kong — are seeing a deceleration in activity.

“The first cracks in the boom’s foundation have begun appearing: house prices declined in half of last year’s bubble risk cities,” the report stated.

The Bank of Canada is looking at the key questions around the design of a digital currency

The Vancouver Sun

The Bank of Canada is looking at the key questions around the design of a digital currency and the issues surrounding such an idea, a senior Bank of Canada official said Monday.

However, deputy governor Timothy Lane told a University of Calgary audience that unless the risks associated with a central bank digital currency can be managed through appropriate design, the bank would not recommend issuing such a currency.

“The design of a CBDC has important implications for its risk and benefits,” Lane said according to the prepared text of his speech released in Ottawa.

“Some major reasons for caution about a central bank digital currency are concerns that it could become a vehicle for illicit transactions or that it could have significant negative implications for financial intermediation.”

Lane said the central bank uses the term cryptoassets to describe cryptocurrencies because they do not do a good job of performing the basic functions of money. The value of Bitcoin has swung wildly with it topping US$20,000 last year and now trading around US$6,000.

However, Lane said, as cryptocurrencies evolve they may touch on the central bank’s core functions including monetary policy, financial stability, payments and currency.

He said the Bank of Canada is not responsible for regulating cryptocurrencies, but it has been examining the potential impact on the stability of the financial system.

Earlier this year, Bank of Canada senior deputy governor Carolyn Wilkins called on authorities to work toward a set of globally aligned policies governing cryptocurrencies. She said it was important to have a strategy on cryptoassets that was as consistent as possible across countries.

Lane said that differences in regulations around the world, together with the incompleteness of regulation in many jurisdictions leaves open room for regulatory arbitrage.

“Differences in the regulatory treatment of these products for controlling money laundering and terrorist financing are a particularly pressing concern,” he said.

Lane noted that they do not yet pose financial stability risks, but things are evolving rapidly as cryptoassets grow in size, complexity and interconnectedness.

“As the underlying technologies and the design of crypto products evolve, we need to be ready to reassess how they might affect financial stability,” he said.

“Some potential aspects include the integrity of payment systems, bank business models, and the exposures of financial institutions and infrastructures.”

© 2018 Financial Post

A report shows affordability at lowest in Q2 2018

Steve Randall
REP

Canada’s housing affordability is at its worst level since 1990 and its going to get worse.

A newly report from RBC Economic Research shows that its aggregate housing affordability measure was 53.9 in the second quarter of 2018, based on the share of household income required for ownership costs including taxes and mortgage payments.

The figure is up from 43.2% just 3 years ago and although house prices are responsible for the initial rise, interest rates are the bigger influence of the past year.

Since Q2 2017, the index has increased 2.6 percentage points and there was a 1.1 percentage point rise quarter-over-quarter. The impact of the mortgage stress test has added to the burden for first-time buyers.

“The grim outlook for prospective home-buyers will likely continue in the near term,” said Craig Wright, Senior Vice-President and Chief Economist at RBC. “We anticipate the Bank of Canada will proceed with further interest rate hikes well into 2019. This will keep mortgage rates under upward pressure and boost ownership costs even more across Canada.”

Condo affordability worsened more than single-family detached homes, especially in Toronto.

Vancouver, Toronto off-the-scale Affordability in Toronto and Vancouver remains at staggering levels with an average GTA buyer facing a burden of 75.9% of their income to cover costs, up 1.8pp in the quarter.

In Vancouver, the situation is even worse having risen 8.2pp over the year and 1.6pp in the quarter to 88.4%.

“The prospect of further rate hikes doesn’t bode well for Toronto or Vancouver buyers, whether they’re on the look-out for a condo or a single detached home,” said Wright. “Affordability pressures are likely to become an even bigger issue for them, which we believe will limit how much home resale activity will rebound from its recent cyclical low.”

Victoria is also showing strained affordability with RBC’s aggregate measure up 2.4pp points to 65% in the second quarter.

Only St John’s saw a slight improvement with other markets generally manageable.

Outlook isn’t great For first-time buyers the ability to afford a home is not going to get any easier any time soon.

RBC Economics expects intensifying affordability pressures to hold back homebuyer demand in the coming year.

Copyright © 2018 Key Media Pty Ltd

EfficiencyBC will provide funds for energy efficient upgrades

Steve Randall
REP

A new $24 million program has been launched in British Columbia to reward homeowners who improve their homes’ energy efficiency.

EfficiencyBC and its partners – the federal government, BC Hydro, FortisBC, BC Housing and many local governments – will provide up to $14,000 to homeowners who switch to high-efficiency heating equipment and to make building envelope improvements.

“This new program makes life more affordable by providing you with the financial incentives you need to make energy-saving improvements,” said Michelle Mungall, B.C.’s Minister of Energy, Mines and Petroleum Resources. “EfficiencyBC will help us lower greenhouse gas emissions while creating opportunities for people, including lasting good jobs through energy retrofits.”

As an example, a homeowner could get up to $2,000 to replace a fossil fuel heating system with an electric air-source heat pump; or $1,000 to upgrade windows or doors. They will also get free energy coaching and guidance on home energy upgrades.

Businesses can also benefit Businesses are also able to access up to $200,000 to make their buildings more energy efficient. Funding includes help towards the cost of an assessment of potential energy savings.

“This program will help British Columbians save money by transitioning their homes and businesses to low-carbon solutions, while also creating more opportunities for the construction industry and building trades. The expertise B.C. businesses and tradespeople will gain through this program will drive innovation and ensure local industry is on the cutting edge of low-carbon construction.”

Copyright © 2018 Key Media Pty Ltd

Interactive map provides years of MLS sold Prices

REM

Vancouver brokerage Holywell Properties is now putting sold prices online for homes sold through the MLS systems of Greater Vancouver, the Fraser Valley and Chilliwack and area on its website at Zealty.ca.

The site’s interactive map provides MLS sold prices soon after they are provided to the real estate board, the company says. It includes a year’s worth of detail on sold properties as well as four years of MLS transaction history for all properties in the Lower Mainland.

The real estate boards are not making the information available in their VOW feeds yet as they study how the Toronto Real Estate Board complies with a Competition Tribunal order to include it and other data, after the Supreme Court of Canada ruled it would not hear TREB’s appeal of the order.

Holywell Properties managing broker Adam Major says the company created a “workaround” to provide the information until the boards begin offering it. Clients can access sold information by creating a password-controlled account on Zealty.ca. “This also allows them to get access to additional market information that is hard to find anywhere else in B.C., including neighbourhood-specific sales statistics, MLS transaction history and recently sold comparable properties,” the company says.

The website’s interactive map also has information on active MLS property listings for the entire province, information about public and independent schools throughout B.C., regional climate information and the location of Agricultural Land Reserve tracts, the company says.

“We’re thrilled with the Supreme Court’s decision because we can now deliver this vital information to our clients,” says Major.

© 2017 REM Real Estate Magazine