Urban Analytics says around 30,000 rental units needed

Ephraim Vecina
Mortgage Broker News

Considering the sustained hunger for British Columbia’s rental units, a markets researcher has argued that around 30,000 units need to be delivered in the next two years to answer this demand.

Urban Analytics Inc. principal of market research Michael Ferreira cited foreign students as a particular area of concern, as this demographic alone might need anywhere from 10,000 to 20,000 units.

GWL Realty Advisors Inc. also estimated that downsizing senior Canadians will need around 38,000 units. Their next generation would require a further 10,000 to 15,000 units.

“We have to stop talking and actually start building, because if even a fraction of this potential demand materializes, we’re nowhere near where we need to be in terms of supply,” Ferreira warned in a recent speech to the Urban Development Institute, as quoted by Business in Vancouver.

“How long do you think before we see a $5 per square foot rent in downtown Vancouver or a $4, $4.50 per square foot rent in Burnaby, Richmond and some of these other places?”

Moreover, the burgeoning tech sector is bound to attract even more potential tenants, which would require additional construction of up to 15,000 units on top of existing and projected delivery.

Landlords are more than likely to enjoy significant windfalls. Statistics Canada data indicated that BC and Ontario play host to a large proportion of housing investors – and many of them have chosen to rent out these properties.

“The number of small landlords shouldn’t surprise many. Canada’s addiction to cheap financing makes condo development more favourable,” Better Dwelling stated in its analysis of the StatsCan data.

BC had over 268,600 multiple-property owners in 2018. Vancouver accounted for 53.6% (143,910 multi-property owners) of this contingent.

Meanwhile, the volume in Ontario last year was 835,175, with around 43% (359,475 owners) in Toronto alone.

Copyright © 2019 Key Media

New Haven to take its place at Onni?s Tsawwassen Landing

Simon Briault
The Province

One of the benefits of buying a new home in a master-planned community is that you know exactly what you’re getting: the amenities, the accessibility of local shops and services and the style and building quality, not just of your own home, but also of the homes around you.

Knowing all this before signing on the dotted line can take much of the uncertainty out of the process.

New Haven, a collection of single-family homes at Onni Group’s Tsawwassen Landing, is a prime example of an opportunity to buy into a master-planned community where everything has been worked out ahead of time.

“We’re able to guide the vision of what we want the community to be and have a cohesive design throughout the neighbourhood,” said Andrew Joblin, regional sales manager at Onni Group.

“We’re developing more than just single-family homes here,” Joblin added. “We have townhomes that we’ve already released and are under construction and there will be more phases in the future. We’re essentially building a brand-new neighbourhood in Tsawwassen.”

There are two interior colour schemes to choose from, along with a range of exterior styles and colours.

Kitchens come with flat-panel or Shaker-style cabinetry with soft-close mechanisms on all doors and drawers. There are polished white quartz countertops and matching backsplashes, built-in pantries and energy-efficient under-cabinet lights.

Master ensuite bathrooms feature flat-panel or Shaker-style ‘floating’ vanity cabinetry with polished quartz countertops and backsplashes. The showers have floor-to-ceiling tiled walls and shower bases and oversized rain heads with adjustable hand sprays. Ensuites also include soaker tubs, large-format porcelain tiles on the heated floors and enclosed toilet rooms with frosted glass privacy doors.

But it’s not just the quality of the homes at Tsawwassen Landing that is drawing interest from buyers. Joblin notes that Tsawwassen has more sunny days and fewer rainy days than anywhere else in Metro Vancouver and notes that the area around Tsawwassen Landing is rich in outdoor amenities that include parks, beaches and golf courses. It’s also only 30 minutes by car to Vancouver and close to every kind of urban amenity at the Tsawwassen Mills and Tsawwassen Commons shopping malls.

“We’ve had everything from downsizers looking for a maintenance-free new home to younger people with kids looking to move up from a smaller space and accommodate a growing family,” said Joblin. “Downsizers have been telling us they just don’t want to deal with having to maintain a house that maybe needs a new roof or a new kitchen. They really like the idea of moving into a beautiful, brand-new house that has lower maintenance costs attached.”

The first phase of single-family homes at New Haven is scheduled to be complete in early 2020.

New Haven at Tsawwassen Landing

What: 63 three- and four-bedroom single-family homes; 14 in the first phase

Where: Hemlock Way, Hazelnut Way and Cormorant Drive, Tsawwassen

Residence size and prices: 2,170 to 2,200 square feet; from $949,900

Developer: Onni Group

Sales centre: 4789 Fisherman Way, Tsawwassen

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

Sales phone: 604-638-3500

© 2019 Postmedia Network Inc.

9850 Austin Road and 9858-9898 Gatineau Place next to SkyTrain?s Lougheed Town Centre Station in Burnaby

Kenneth Chan
other

We now have a first glimpse of the proposed architectural design of the new tallest building in Metro Vancouver, as well as its two sister towers.

A new preliminary conceptual artistic rendering provided to Daily Hive by local developer Pinnacle International Development shows an early design of the three-building complex, slated for a 6.2-acre site at 9858-9898 Gatineau Place — immediately northeast of SkyTrain’s Lougheed Town Centre Station.

The developer is currently in the early stages of the City of Burnaby’s rezoning application, and there are few new details at this time.

 But based on a previous city staff report on the proposed rezoning, the tallest tower — an 82-storey building — will contain a mix of retail and hotel uses within the lower floors and residential uses within the upper levels. Based on the standard floor-to-ceiling height conventions of each type of use, the height should be at least 800 ft., if not more, making it not only the new tallest building in the region but also one of the tallest buildings in Canada west of the Toronto region.

It would not only be the region’s tallest, eclipsing downtown Vancouver’s towers and other suburban tall tower proposals, but also one of the tallest buildings in Western Canada.

In addition to this super-tall East Tower, Pinnacle’s proposal for the large site also includes two other shorter towers that are still considerably tall for the region’s standards.

The West Tower, reaching 67 storeys, will include retail, office, and residential components, while the South Tower will entail retail and residential uses.

The released artistic rendering also shows the redevelopment’s integration with the new transit plaza serving the SkyTrain station and bus loop, as well as a ribbon-like flyover of elevated pedestrian walkways that seamlessly connect the three buildings and surrounding areas.

“The design is inspired by nature with the three buildings metaphorically representing an ensemble of flowers expressed through appropriate massing and architectural articulation,” reads a letter of intent to the City of Burnaby by George Kallergis, vice-president of development for Pinnacle.

“The ground level for each tower will be animated with retail uses that will activate the public realm and integrate with the transit plaza. The second level will include retail components in each building together with a hotel lobby in the ‘East Tower’ and an office lobby in the ‘West Tower.’”

According to the city staff report providing the first details on the proposal, the redevelopment would “remain consistent” with the recently-approved Lougheed Town Centre Plan and Lougheed Core Area Master Plan.

The combined residential uses of all three towers would create a floor area ratio (FAR) residential density of 13.25 times the size of the lot, with 11.91 FAR coming from market condominiums and 2.16 FAR from market rental and affordable rental homes. In real quantities, the market condominium portion alone would create 1.9 million sq. ft. of floor area.

Under the city’s newly approved rental housing policies this year for new multi-family developments, there must be a top up of at least 20% in density dedicated for rental housing uses.

These numbers do not include 430,000 sq. ft. of commercial uses — retail, hotel, and office.

The Lougheed Core Area Master Plan envisions the drastic densification of a 72-acre immediately north of Lougheed Town Centre Station, including Shape Properties’ 37-acre ‘City of Lougheed’ redevelopment of Lougheed Town Centre shopping mall. When the area is fully complete, there will be a transit-oriented development cluster of new retail, office, and residential space, plus new public spaces and amenities.

DH

Summary of the applicability of GST to purchase and sales

other

This month’s newsletter is a summary of the applicability of GST to purchase and sales. Remember that you are not GST experts and should not be giving advice to your clients that GST is or is not applicable to their transaction. The most you should say is “I believe or my understanding is that GST is/is not applicable but you should confirm this with your lawyer or a GST expert” 

The general rule is that GST is applicable to sales of newly constructed or substantially renovated properties. If the buyer is registered for GST they do not have to pay it, but they do have to charge it on any subsequent sale. 

If the purchase price is less than $350K and the property is being bought for personal use, there is a rebate of 36% of the GST paid. Some developers credit that rebate on the adjustments by having the buyer assign the rebate to the developer. Other developers expect the buyer to pay the full GST on closing and apply themselves for the rebate. Obviously you want your deal to have the first option. 

If the price is between $350K and $450K the amount of GST rebate is reduced as the price gets higher, to the point that when you reach a $450K price there is no more rebate. 

For newly constructed or substantially renovated properties that the buyer intends renting out GST is payable on the sale and the rebates are just as in #1 & 2. After the buyer has rented it out he can apply for a rebate by filling out the required rebate application and sending a copy of the signed lease and other documents to the CRA. 

As the re-sale market for newly constructed condos has decreased, lots of people, who had hoped to “flip” their unties before closing are having to close and are then putting the unit up for sale. They have to pay the GST on the closing. But do not assume that because the buyer paid GST to the developer, that the buyer who then sells, can sell free of GST. If the buyer, now seller, did not occupy the unit or intended to flip it when he first signed the developer’s contract, then he has to charge GST on his sale of it. If the agreement is silent as to who pays any applicable GST the buyer has to pay it if the CRA later asks for it. So the safest thing for your buyer client is for the agreement to say “price is inclusive of any applicable GST”. That way if the CRA comes asking for GST they will have to get it from the seller. 

I remind agents that I offer them free short phone consultations. For clients I charge fixed all inclusive fees for transactions and will visit the client in the evening or on weekends to sign documents. My prices are inclusive of all taxes and disbursements, except for title insurance if required by the lender. 

Contrary to what people think, a lawyer is not more expensive than a notary. Remember that all lawyers are notaries, but notaries are not lawyers. My experience is that as soon as there is a problem with a deal, most notaries will tell the client to see a lawyer for help. So why not start with a lawyer?  I welcome the opportunity to quote on your client’s conveyance.   

As well I do commercial real estate work, including leases, corporate work and wills and estates.

Condo Buyers in Ontario get protection by province

Steve Randall
Canadian Real Estate Wealth

Condo buyers in Ontario will get greater protection following the announcement of new requirements by the province’s home warranty provider.

Tarion will says the new measures will help educate and inform prospective homebuyers and will include the addition of new search tools on Tarion’s Ontario Builder Directory and a new detailed information sheet highlighting the potential risks of purchasing certain types of pre-construction condominiums.

“The purchase of a new home is often the most important one that many Ontarians will make,” said Tarion’s President and CEO Howard Bogach. “At Tarion, we’re doing our part to ensure that these purchases are guided by a thorough understanding of the risks, builder history, and status of a given project. The initiatives that we’re announcing today will contribute to a better informed purchasing process.”

The new mandatory disclosures will be effective from January 1, 2020, and will ensure that potential buyers are aware of several key risk factors including:

• pre-construction condominiums come with the risk that they may never be completed;
• early termination conditions that would allow a developer to cancel a project; 
• information about the status of the development (e.g., formal zoning approval, relevant approval authority and date of commencement of construction);
• information about any restrictions on the developer’s land title that may prevent the project from going forward; 
• a purchaser has an initial 10 days under the Condominium Act, 1998 to cancel a sales agreement; and
• the expected date when a purchaser can take occupancy.

The new information sheet will be required for all agreements of purchase and sale for units where the purchase agreement for the project or phase of the project is signed after January 1, 2020.

However, leasehold, common element and vacant land condominiums are excluded from the requirement.

Copyright © 2019 Key Media Pty Ltd

Brookfield Residential being featured on Zillow

Ephraim Vecina
REP

Zillow is introducing listings for new home construction in Canada, with industry leader Brookfield Residential being the pioneer builder to have its projects featured in the online platform.

“With the inclusion of new construction listings on Zillow in Canada, we’ll provide an even more comprehensive home shopping experience for our growing audience of Canadian consumers,” chief industry development officer Errol Samuelson said.

Brookfield has joined the more than 250 Canadian brokerages and franchisors that have inked agreements with the real estate portal.

“Buying a home, new or resale is one of the most important decisions in someone’s life and by adding our listings to Zillow, we think this helps ensure consumers can make an informed decision based on availability, pricing and many other factors,” Brookfield Residential VP of sales and marketing Marc Thibault stated.

“Zillow Group is excited about the opportunity for Canadian builders to tap into Zillow’s audience of home shoppers,” Zillow VP of new construction Lucy Wohltman added. “Brookfield Residential has long been a strong partner in the U.S. and it is great to have them help lead the way with us in providing a comprehensive home shopping experience for Canadian consumers.”

At present, Zillow enjoys more than 194 million visits monthly from hopeful home buyers. The company has expressed optimism that this volume will continue to grow as Zillow further expands its Canadian offerings.

Copyright © 2019 Key Media Pty Ltd

Incoming tech workers, downsizing empty-nesters, international students will all add to demand for purpose-built rental homes, says researcher

Peter Mitham
Western Investor

Two years ago, the B.C. NDP campaigned on a pledge to deliver 114,000 affordable housing units within a decade. The housing crisis has hardly improved since then, with prices and rents both increasing even as sales pulled back.

Speaking to the Urban Development Institute recently, Michael Ferreira, principal of market research for Urban Analytics Inc., offered his take on what’s required in terms of purpose-built rental units.

Ferreira believes foreign students could require 10,000 to 20,000 units. Downsizing empty-nesters could need 38,000 units, according to numbers provided by GWL Realty Advisors Inc., while their children could require 10,000 to 15,000 units.

And let’s not forget about all those jobs the booming tech sector is drawing to the region: Ferreira said that with 20,000 workers coming, it’s fair to add another 10,000 to 15,000 units to demand, especially as many of them will be foreign nationals who have better things to spend their cash on than B.C.’s foreign buyer’s tax.

Add those numbers up and you’ve got an estimated demand for at least 68,000 purpose-built rental units, a far cry from the 3,273 purpose-built rental units set to complete this year and 10 times the 6,800 units in planning for the region. Ferreira said afterwards he believes 30,000 units are necessary in the next two years to meet oncoming demand.

But with municipalities such as the District of North Vancouver not budging on approvals, Ferreira presented a stark vision of the future.

“We have to stop talking and actually start building, because if even a fraction of this potential demand materializes, we’re nowhere near where we need to be in terms of supply,” he said. “How long do you think before we see a $5 per square foot rent in downtown Vancouver or a $4, $4.50 per square foot rent in Burnaby, Richmond and some of these other places?”

Offering a counterpoint

But a few hours after Ferreira delivered his talk, Simon Fraser University associate professor of public policy Josh Gordon participated in a panel discussion with David Hutniak, CEO of LandlordBC; Tony Pappajohn, president of Jameson Development Corp.; and Squamish Nation councillor Khelsilem.

Gordon argued the issue isn’t so much how many units are built as it is security of tenure.

Gordon, who rents a condo from family and (as Hutniak noted) has pretty solid tenure, said households with an annual income of $80,000 and up have secure tenure because they can afford alternative accommodation if displaced (median household income in Metro Vancouver is 15th highest in Canada, at $72,662 in the 2016 census, according to Statistics Canada).

What’s needed are policies that protect housing for those with the least leverage in the market, Gordon said. Cracking down on short-term rentals and owners who leave units vacant, and having more cash for those who lose tenure through renovictions and demovictions are his favoured options.

“The low vacancy rate is a product of a high economy – nothing more, nothing less,” he said, claiming (as some University of British Columbia instructors shook their heads in disagreement) that there are no peer-reviewed academic studies showing that boosting the stock of purpose-built rentals improves vacancies.

“Supply is on the way. It’s already being delivered,” said Gordon, claiming there are 45,000 units for sale and rent under construction in Metro Vancouver.

Pack ’em in

A glance at Statistics Canada data puts the much-discussed Metro Vancouver housing shortage in context.

The region has approximately 2.6 people per bedroom (StatsCan lumps dwellings with five-plus bedrooms together). This is less than Toronto (2.8 people per bedroom) but more than Montreal (2.4 people per bedroom). Fraser Valley homes are exceptionally cozy with nearly three people per bedroom in Abbotsford-Mission and 3.2 per bedroom in Chilliwack.

The statistics indicate that Abbotsford is also the best place in the Lower Mainland to find households of five or more people living in a studio apartment (more than four per cent of units are apparently inhabited this way, versus less than one per cent in Vancouver).

Copyright © Western Investor

Township of Langley development intended as “intergenerational community” including 2,000 homes, parks, retail and school

Frank O’Brien
The Vancouver Sun

Rendering shows future phase of Latimer Village in Langley. | Submitted

A 74-acre mixed-use development in the Township of Langley, said to be the largest master planned community of its type in Metro Vancouver, officially began October 26 with an open house, even though home construction on the site began earlier this year.

Latimer Heights, being developed by Vesta Properties, is meant to be an intergenerational community that will consist of approximately 2,000 homes, a new elementary school and 17 acres of green space and parkland. A retail village is also planned as a later phase in the development. The total cost of the development is projected at $1 billion.

“We designed this community where we’ll see families moving in and then perhaps the grandparents joining them in another part of the community. We’re expecting first-time homebuyers all the way up to retirees. Everybody will be living together. Latimer Heights will create a new kind of community that will blend a wide variety of demographics,” said Kent Sillars, Vesta president. 

Homes will include detached houses, row homes, townhouses, duplexes, and low- and high-rise condos, according to Sillars.The development will not have specific retirement homes, however.

Prices for detached houses of 2,500 square feet start at $883,000; townhomes start at $555,000; and condo apartments will be in the “low $300,000 range,” according to Vesta sales staff.

Latimer Heights is close to the proposed SkyTrain that will eventually link Langley with the SkyTrain hub in central Surrey.

© Copyright 2019 Western Investor

October Luxury Insights Report shows that emerging markets are leading the way in luxury real estate

other

As millennials and aging baby boomers look to downsize, areas outside of the usual coastal luxury destinations are responding with a new urbanist approach to luxury. Condo developments in safe, walkable areas are continuing to rise in popularity, and today’s luxury home buyer is willing to pay top dollar for properties that mix work, play, and community.

Though the market appears static, these growing pockets of new luxury are showing incredible potential. 

October’s real estate market trends show an overall buyer’s market

While September’s Luxury Insights Report revealed a balanced market overall, October’s luxury home market has officially shifted towards the buyer’s advantage in most markets.

Congruent with the real estate market trends that we have seen throughout most of 2019, these buyers are seeking homes that support active, efficient, eco-friendly lifestyles with the newest amenities.

They are not as interested in large, labor-intensive estates, and as a result, many upper-tier market homes are seeing longer listing times (although, it should be noted that these estates have historically taken longer to sell). 

Therefore, the slowing of sales in some upper-tier markets has less to do with upper-tier price points and more to do with the types of properties being offered and the way they are being marketed to today’s buyer. Buyers are still willing to pay upper-tier prices, just as long as they consider the price to be a match to the lifestyle they’re seeking.

Recently, Los Angeles saw a record-breaking sale at $119 million, while luxury homes in Florida, Denver, and Texas saw sales that were 94-100% of their asking price. 

At this time, luxury home sellers can still capitalize on this changing market by working with well-educated real estate professionals who can position their home to align with today’s luxury buyer’s desired lifestyle. For instance, a large, luxury ranch can play to a buyer’s preference to stay active, while an older, larger estate can support co-living with extended family. 

Additionally, paying close attention to what is selling in the area and listening carefully to buyers’ expressed pain points during showings can help agent and seller tailor the listing to increase its perceived value among the abundance of inventory.

In some cases, sellers may need to be willing to update their home before listing, while luxury real estate agents may have more success by privately listing larger estates to avoid listings publicly sitting on the market for too long.

An increasing number of wealthy buyers are seeking co-living and rental opportunities

Another emerging trend in October’s report shows that there is a rising number of wealthy buyers who are seeking both co-living and rental opportunities.

While this is especially true among younger, millennial buyers, current real estate market trends show that buyers among all age groups are placing more value in having a sense of community.

Luxury condos with common spaces such as rooftop gardens, wine bars, dog areas, and coffee lounges are growing in popularity in response to the recent focus on social well-being. 

Markets like Austin, Fort Worth, Seattle, Raleigh, and others outside of the usual Los Angeles and New York luxury markets are spearheading the development of these new, luxury condo developments.

The trend is creating a “cool suburbia” in those areas that some are calling “hipsturbia”.

Even the aging sector of the luxury home market is choosing to downsize in favor of having easy access to new experiences. Rather than choosing large estates or moving into senior housing, this particular demographic is also becoming a part of the “hipsturbia” scene and choosing quality over space. They, too, prefer newer, modern amenities and environmentally-friendly design. With these unprecedented shifts, it has become increasingly important for luxury real estate agents to actively listen to buyers and sellers and to be ready to take on the role of consultant for either group.

Our Luxury Live Events and Online Luxury Trainings are a great way to network with other elite luxury real estate agents and learn how top-tier agents navigate real estate market trends. 

© 2017 The Institute for Luxury Home Marketing.