Single-family home reaches $327,450 in Montreal

Ephraim Vecina
Canadian Real Estate Wealth

Home prices in Montreal continued to grow as sales reached new heights last month, according to the Greater Montreal Real Estate Board.

The median price of a single-family home in the market increased by 7% on a year-over-year basis in December, reaching $327,450. Meanwhile, the median price of plexes grew by 8% during the same time frame to settle at $525,000, and that of condos by 3% to $272,863.

These coincided with the market’s achievement of a new home sales record for December, growing by 3% annually to reach 2,825 completed transactions.

December was also the 46th consecutive month of growth in the number of transactions, according to the GMREB.

Single-family homes accounted for 1,491 sales, growing by 3% annually. Condo sales also increased by 2% (up to 993 deals closed), while plexes shrank slightly by 1% (down to 336 transactions).

Montreal’s supply stood at 18,970 active residential listings as of the end of 2018, which was 18% lower compared to the same time in the previous year.

Copyright © 2019 Key Media Pty Ltd

BoC left interest rate unchanged

REP

The Bank of Canada left its trend-setting interest rate unchanged at 1.75% on Wednesday as the sharp decline in oil prices temporarily dims its economic outlook for the coming months.

Before long, however, the central bank expects the economy to expand with renewed vigour. More rate hikes, it stressed, will be necessary “over time”.

n its first policy announcement of 2019, the bank said the recent drop in crude prices will result in slower-than-expected growth in an economy that has otherwise been performing well.

The bank is now projecting growth to be just 1.7% in 2019, down from its October forecast of 2.1% – but it remains optimistic the economy will begin to strengthen again as early as the second quarter of this year.

“The drop in global oil prices has a material impact on the Canadian outlook, resulting in lower terms of trade and national income,” the bank said in a statement.

“Looking ahead, exports and non-energy investment are projected to grow solidly… Indicators of demand should start to show renewed momentum in early 2019, leading to above-potential growth of 2.1 per cent in 2020.”

The business-investment lift, the bank said, will get a boost from Ottawa’s recently announced tax changes to allow companies to write off a bigger share of the cost of new assets in the year they are purchased.

The big question, however, is what this will all mean for the pace of future interest-rate hikes.

Governor Stephen Poloz has been gradually raising the rate since mid-2017 to keep inflation from rising too high.

The timing of its next hike will depend on several factors, the bank said, and there will be a particular focus on developments in the oil markets, the Canadian housing sector and global trade policy.

The Bank of Canada has estimated it will no longer need to raise the rate once it reaches a “neutral” level of between 2.5 and 3.5%.

“Governing council continues to judge that the policy interest rate will need to rise over time into a neutral range to achieve the inflation target,” the bank said.

In addition to the oil slump, consumption and housing investment were underlined as weaker than expected in large part due to higher borrowing costs and stricter mortgage guidelines. But household spending is expected to continue to be supported by other factors, the bank said in its latest monetary policy report, also released Wednesday.

The bank listed these factors as population growth fuelled by immigration, low unemployment rates, cheaper gasoline prices and wage gains.

It also pointed to several areas of uncertainty – the persistence of the crude-price drop, the extent of its impact on non-oil-producing regions, how household spending adjusts to previous interest-rate hikes and tighter montage rules, and global trade developments such as the U.S.-China conflict.

The bank projects growth in the fourth quarter of 2018 to be 1.3%, compared with its earlier prediction of 2.3%. Growth is expected to be just 0.8% over the first three months of 2019.

Canada’s sharp deceleration in wage growth since last spring has also been highlighted by experts as a concern for the economy – particularly since the tightened labour market should translate into higher wages.

The bank addressed the issue on Wednesday by saying national wage-growth figures have been weighed down by weaker numbers in the oil-producing provinces. The rest of the country has shown a steady level of wage growth in recent years and the bank remains hopeful it will pick up its pace.

The bank estimates the oil slump, which began last summer and has seen prices recover in recent weeks, will reduce the level of Canada’s gross domestic product by 0.5% by the end of 2020. The economic impact of the decline is expected to be about one-quarter as large as the 2014-16 oil-price shock, the bank said. 

The Canadian Press

Copyright © 2019 Key Media Pty Ltd

December best month for sales ever

Steve Randall
REP

December was a busier-than-usual month for real estate agents in the Greater Montreal CMA, concluding 2,825 sales.

Greater Montreal Real Estate Board data from the Centris database shows that it was the best December on record for sales and a 3% increase on the same month of 2017.

ales have increased in the CMA for 46 consecutive months.

December’s gains were across five of the six main areas of the region led by Vaudreuil-Soulanges (13%) and Saint-Jean-sur-Richelieu (8%).

Transactions were also on the rise on the North Shore (6%), Laval (5%) and on the South Shore (3%) while the Island of Montréal was the only area that posted a decrease in sales, down 1% year-over-year.

Single-family homes saw a 3% gain and accounted for the largest share of sales (1,491) while condos gained 2% to 993 sales and plexes saw a 1% decline in sales to 336.

Inventory was tighter in December 2018 than a year earlier, dropping 18% to 18,970 homes available on Centris.

The median price of single-family homes and plexes increased significantly across the Montréal CMA in December, reaching $327,450 (up 7%) and $525,000 (up 8%) respectively. The median price of condos rose by 3% to $272,863.

Copyright © 2019 Key Media Pty Ltd

Capable management key to adopting new technology

Ephraim Vecina
REP

Adopting a new technology into the operations of a brokerage often comes with the promise of greater efficiency, but introducing such a disruptive factor into an established workflow will almost certainly lead to friction.

A crucial component of ensuring the smooth transition is capable management.

“When we decided that we were really going to go paperless, the key to making it successful was for someone to own it – from beginning to end,” according to Leanne Forsee, administrator with Dilbeck Real Estate.

Such a shift should ideally be managed by those who have deeper familiarity with the technology and how it best relates to the brokerage’s processes. These point persons should be designated as the “Change Champions” that could explain the virtues of the new tech to the rest of the firm, and help ease the brokerage into the new environment.

“The very first thing you have to do is clearly articulate why you are making the change. You cannot over communicate this point,” says Angela Raab, Director of Technology Advancement with F.C. Tucker.

Ensuring the best possible knowledge transfer would also entail the training of a “Pilot Group”, a crack team of technically proficient individuals who can best relate the new system to the existing workflow – and might even devise a novel application of the new tech in the process.

Overall, the roll-out of a new tool or platform could certainly be far less of an ordeal and more of a new beginning for a brokerage looking to expand its reach and offerings even further.

Copyright © 2019 Key Media Pty Ltd

Fraser Valley Real Estate Board?s MLS saw 15,586 sales in 2018

Steve Randall
Canadian Real Estate Wealth

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.

Copyright © 2019 Key Media Pty Ltd

Radon the invisible killer

Canadian Real Estate Wealth

Any property can have a radon problem – old or new, well sealed or drafty, with or without a basement. Health Canada estimates that one out of every 14 homes in Canada has an elevated level of the gas.

Prolonged exposure to unsafe levels of radon can create an increased risk of lung cancer; in fact, radon is the second leading cause of lung cancer after smoking. Lung cancer caused by avoidable radon exposure is preventable, but only if radon issues are detected and mitigated prior to prolonged exposure in homes and buildings. There is real risk in not knowing if a property has a high level of radon.

What is radon? Radon is a naturally occurring, odourless, colourless radioactive gas formed by the ongoing decay of uranium in soil, rocks, sediments and even well or ground water. While radon that escapes into the atmosphere is not harmful, dangerously high concentrations can build up indoors, exposing residents to possible health risks.

How does radon get into a home? Radon can migrate indoors in several ways. Openings or cracks in basement walls, foundations or floors are common avenues. Sumps, basement drains and spaces between gas or water fittings can also allow radon into the structure. Other entry points can include gaps in suspended floors and cavities within walls.

How can I make sure the occupants of my properties aren’t at risk? A professional radon inspection includes the setup of monitoring equipment at the property and a report on the results. If an elevated level of radon is detected, steps can be taken to reduce the concentration to or below acceptable levels inside virtually any home. This can include a relatively simple setup such as a collection system with a radon vent pipe, which prevents radon from entering the home in the first place. Professional mitigation services can provide recommendations for a home’s specific conditions.

For more information, please visit the nationwide home inspection experts at pillartopost.com.

Copyright © 2019 Key Media Pty Ltd

In 2019 60% feeling good about economy

Ephraim Vecina
REP

Fiscal anxiety is the running theme among a significant proportion of Canadians going into 2019, with less than 60% feeling good about the national economy this year, according to the results of a year-end survey conducted for Global News by Ipsos.

This ratio was considerably lower than the 65% in 2017. The share of the population pessimistic about the economy is also steadily rising, at 41%.

Moreover, only 64% of Canadians said that their retirement plans and savings are in good shape, down from the 72% in 2017 and the 65% in the year prior to that.

Around 71% of respondents stated that they are “feeling good” about their personal finances at the end of 2018, noticeably lower than the 80% in 2017 and the 75% in 2016. Only 61% said that they are actually in a “good” financial situation, compared to the 66% in 2017 and the 62% in 2016.

“This is one of the commitments that the federal government made when it ran in 2015, it was going to help the middle class and those who want to join the middle class,” according to Ipsos. “That particular group of people is feeling particularly hard done by these days.”

Copyright © 2019 Key Media Pty Ltd

Eighty-minute drive from Vancouver reveals a community with affordable homes and an expanding commercial and industrial base

Western Investor

Chilliwack is 102 kilometres east of Vancouver but light years away when it comes to affordable housing, a fact that is enticing major employers and new residents to one of B.C.’s fastest-growing regions.

The average price of a Chilliwack home is less than $480,000, compared to more than $1 million in Greater Vancouver. The average monthly rent for an apartment in Chilliwack is $887, according to Canada Mortgage and Housing Corp., a price that is also about half of what it costs in Vancouver.

As in all of B.C., Chilliwack’s housing sales have fallen, down 38 per cent in October 2018, as an example, from a year earlier. But, as the Chilliwack and District Real Estate Board (CADREB) notes, 2017 saw a “frenzied pace” that set an annual sales record. 

“The market has returned to better balance,” noted Lori Maier, CADREB president.

The commercial market, however, is moving towards a seller’s advantage.

In the first nine months of last year, Chilliwack commercial building permits virtually doubled from a year earlier to $34.2 million while residential building permits hit $145 million, down from $171.5 million from the white-hot pace of 2017.

On the industrial side, the massive new $200 million Molson Coors brewery, which relocated from Vancouver, is ascending on a 35-acre site next to the Trans-Canada Highway. It is taking 1,000 workers to build the 400,000-square-foot plant, and about 100 employees will be required for Molson’s biggest brewery in Western Canada when it completes this summer.

Industrial demand 

Molson joins other major employers, such as Ritchie Bros. Auctioneers and John Deere, in providing a solid economic base that is fuelling industrial demand, according to Chilliwack commercial real estate agent Rick Toor.

But, Toor cautioned, it is getting harder to find enough industrial space to meet demand.

Most of the new industrial space under development has already been claimed, including a 60,000-square-foot building that opened as a build-to-suit in the Highway Business Park last fall. Only 25,000 square feet of new industrial speculation was underway as of the third quarter of 2018, and it is not expected to last long on the market.

Industrial prices reflect the demand. Two recent deals saw a 12,700-square-foot building sell for $3.15 million in July – that is $248 per square foot  –  and a 1.4-acre industrial package with a self-storage outlet on Industrial Way sell last year for $10 million, according to Avison Young and RealNet data. That price was $2.4 million above its assessed value. 

Toor has just listed a one-acre serviced industrial site on Enterprise Drive, one of the few parcels still available in Chilliwack, at $1.8 million.

Brian Coombes, president of Chilliwack Economic Partners Corp., noted that about 30 acres of industrial land is available in the agricultural business zone where Molson Coors is located. He added that the City of Chilliwack has an “employment land strategy” as it attempts to match demand with potential industrial sites. This will involve working with private landowners and First Nations, Coombes suggested. 

Retail vacancy is also tight in the shopping malls of Chilliwack, and the slightly higher vacancy in the downtown is being addressed by an aggressive new development.

Transforming downtown 

After winning a bid for a city-owned 3.7-acre parcel, the Algra brothers of Abbotsford have launched a visionary downtown project known as Five Corners.

Five Corners is expected to transform Chilliwack’s downtown into a European-style working and living, pedestrian-friendly district.  The redevelopment will see a combination of retail, commercial and residential as part of the multi-year, multi-phase project that will “provide a balance of jobs, amenities and housing to create a diverse and inclusive downtown core,” according to a city statement.  

Algra Bros. Developments Ltd. is owned by Dave, Peter and Philip Algra. The brothers are known throughout Chilliwack for high-quality construction and developments such as Garrison Crossing, an award-winning mixed-use project on former military lands.

Algra officially began work on the Five Corners site in December. Dave Algra said it will include 50,000 square feet of retail space and 120 to 130 homes, both rental and strata.  

The first-phase plan is to have half the retail and up to 20 housing units complete in 2019, he said. 

The City of Chilliwack has been investing in the downtown core for over two decades. New facilities like the Chilliwack Cultural Centre, the Landing Leisure Centre and the Prospera Centre helped establish the area as a hub for activity. Streetscaping, utility upgrades, park development and greening have also been strategically implemented.

Algra’s residential component may lean towards rentals, if current housing trends persist. Chilliwack currently has a tight 1.7 per cent rental vacancy rate and both rents and per-suite prices are increasing.

“A few years ago, old apartment buildings from the 1970s were selling for $85,000 a door,” Toor said. “Now they are $150,000 to $160,000 per door.”

Multi-family capitalization rates are in the 4 per cent to 5 per cent range now, down from close to 6 per cent two years ago, Toor estimated.

It appears that Chilliwack is becoming closer to Metro Vancouver every year.

Copyright © Western Investor

An East Vancouver rental project will be paid by taxpayers

Western Investor

A new joint venture will see taxpayers ante $40.2 million for a private development to create an East Vancouver rental project where subsidized one-bedrooms will rent for $1,500 and two-bed-rooms for $1,950 when it completes this year.

The subsidy works out to approxi-mately $609,000 for each of the 66 “affordable” rental units. In com-parison, the current benchmark price of an existing condo apart-ment in East Vancouver is $569,000, according to the Real Estate Board of Greater Vancouver.

The 111-unit rental complex, now under construction on East 18th Avenue, involves Cressey Develop-ment Group and Canada Mortgage and Housing Corp. (CMHC) and is meant to include lower-cost rentals for working families. These rents are geared to match 30 per cent of the typical household income in East Vancouver. Through an agreement with the City of Vancouver, this af-fordability level will be maintained for 60 years.

According to a November survey by PadMapper, an online rental registry, the median rent for a one-bedroom Vancouver apartment is $2,100 per month, with two-bed-room rents at a median of $3,150.

CMHC’s Rental Construction Fi-nancing Initiative provides low-cost construction loans for 10-year terms to enable developers such as Cressey to build affordable rental housing, according to Jean-Yves Duclos, the federal minister of families, children and social development and minister responsible for CMHC.

The Cressey project, known as the Conrad, faced opposition from local residents who complained about the higher density. It took five years to achieve rezoning, according to Cres-sey vice-president Jason Turcotte. During that period, he said, there were five consecutive interest rate hikes and double-digit construction cost increases.

 “The long process, although some-what necessary and often with some good result, [does] have a price, for sure,” Turcotte said.

What new or soon to be real estate agents need to know

Brandon Hindle
REM

If you’re thinking about becoming a real estate agent, or you’re a new agent, you will realize quickly that real estate isn’t the “easy money” most people think it is. There are a lot of reasons for this, from the sheer amount of competition in the industry to the bad names that some really bad Realtors have given us.

There are two major barriers that I believe stop Realtors from being successful. They are a lack of education and hard work/perseverance. Getting a proper and thorough real estate agent education and not giving up will be the two things that help you get to the top.

How do you get the proper education and start yourself down the right path?

One decision I got right early on and am still proud of today was the way I chose my brokerage.  I met with five different brokerages and got to know their training managers, managing brokers and even some brokers of record. This allowed me to interview them while they interviewed me. I learned what some brokerages offer that others didn’t.

Knowing I wanted the best start possible, I chose a brokerage that offered a lot of education. I can never express my appreciation for the education my brokerage and trainer offered.

A great brokerage will teach you everything from lead generation to building your sphere of influence, to sales and marketing. They will help you make valuable networking connections and continue to teach you with weekly meetings, monthly events and ongoing training.

Choose the right brokerage and you are well on your way to success.

Educate yourself around your passions

The next step for me was learning who I was as an agent, what I liked doing and what business I wanted to build for myself.

The beauty of this industry is that you can tailor it to what you like to do. If that’s knocking on doors and cold calling, you can do it. If it’s networking with people through sports and events and online, you can build your business that way, too. Whether you like pounding the pavement or the keyboard, you can find success in this business.

That’s why the next stage of your real estate agent education is learning and focusing on your passions.

When I was first in the industry, I thought cold calling and door knocking would be the focus for me. Turns out I enjoy door knocking and despise cold calling.

“If you do what you love, you’ll never work a day in your life.” – Marc Anthony.

I played off the fact that I love to talk, especially about real estate. I also learned that I love the intricacies of building an online presence with a website, blog, social media and advertising. If you play off your passions, it won’t feel like work. For my business partner Tim, he had no idea what he wanted to focus on when building his business. He had no idea how to find people to work with. That’s where his brokerage training came in. He learned the different things he could try and realized he enjoyed the challenge and grind of cold calling and learning how to handle people’s objections.

It astounds me that he can jump on a phone at 9 a.m. and call all the way through to 1 p.m. I’ve heard people cuss him out and I’ve heard people tell him their life stories. I’ve heard him laugh with some people and shed a tear with others. He loves hearing people’s stories, bringing them value, and getting to know them.

It’s inspiring and terrifying.  I tried it and simply can’t do it. But that’s my point. Your real estate agent education should focus on and educate you around your passions.

Find salespeople who inspire you and learn what they are doing

Next, and honestly one of the most important things, is finding people who inspire you in the industry. There are so many we’ve talked to and so many who have helped to influence what we are building. Find who’s building a successful business with that strategy and learn everything you can about them.

The people that inspire you don’t just have to be in the real estate industry to teach you valuable lessons and things that can work for your business. Some of my other inspirations include Grant Cardone (the ultimate sales legend and motivator), Chris Smith (real estate marketing guru), Dan Norris (online content king), Pat Hiban (real estate legend), Scott & Alison Stratten (Unmarketing senseis and champions of customer service) and last but not least, Gary Vanyerchuck (social media ninja, and genie/fortune teller hybrid).

It’s a long list I know, but the best part is that doesn’t even capture everyone. I’ve consumed hours of inspirational and educational content from each of these people. They inspire me and they can inspire you too. However, these people may not be the models for you and that’s fine. Dive into teaching yourself and you will find your own people who inspire you.

Train yourself every day

After you’ve completed the initial training, found the right brokerage, found your passions and inspirations, it’s time to train yourself every single day in the areas you’ve decided to focus on. You need to get your 10,000 hours. That’s when you truly become the master of what you’re learning.

This can be practicing and role-playing, researching and reading. But it also needs to be doing. Get out there every day and teach yourself what you can.  Just make sure you don’t fall victim to analysis paralysis. Get out there and actually do! My first blogs were not the best. There was no SEO planning and no thought to readability.

Still to this day, Tim and I are both working on our 10,000 hours in multiple areas. Don’t give up, practice every day, and you will be successful. If others can do it, so can you.

Find accountability partners

The single biggest thing that has helped me stay motivated and focussed is the many people I have surrounded myself that I’ve asked to hold me accountable. It’s easier to procrastinate and give up when it’s just yourself you have to face.

My real estate trainer, my friends, my family, my business partner Tim and my wife all hold me accountable to the dreams and ambitions I’m working towards. Tell everyone you can what you’re planning and work hard for it. These accountability partners will give you a kick in the ass when you need it and will inspire you to work hard every day.

Make them proud and make yourself proud.

© 2017 REM Real Estate Magazine