Federal government to offer $27 billion in direct support to struggling Canadians, plus $55 billion in tax deferrals

Tyler Orton
Western Investor

The federal government will offer $27 billion in direct support to Canadians hit hard by the COVID-19 crisis as well as $55 billion in tax deferrals.

Prime Minister Justin Trudeau unveiled the $82-billion aid package Wednesday morning (March 18), shortly after confirming Canada and the U.S. would restrict all non-essential travel across the border.

Aid includes an emergency care benefit for workers who don’t qualify for employment insurance but find themselves ill, facing quarantine or caring for family members who have been hit by illness.

The emergency care benefit will be paid out every two weeks for 14 weeks for an amount comparable to employment insurance.

Applications for the benefit will be made available in April.

Ottawa is also putting up $3.8 billion to small businesses in the form of a temporary wage subsidy equivalent to 10 per cent of salary paid to employees for three months in a bid to keep staff on the company payroll.

The subsidy maxes out at $1,375 per employee and $25,000 per employer.

Beyond direct support, the Business Credit Availability Program will let small and medium-sized businesses tap into at least another $10 billion in credit through the Business Development Bank of Canada and Export Development Canada (EDC).

Credit available to farmers and the agri-food sector will be boosted through Farm Credit Canada.

The federal government is also changing the Canada Account, a tool used by EDC to support transactions determined to be in the national interest, to allow Finance Minister Bill Morneau to determine the limit of the account to deal with exceptional circumstances.

The changes will allow government to provide additional support to exporters in the form of loans, guarantees or insurance policies.

The Canada Revenue Agency will be allowing businesses to defer any owed taxes until August 31, 2020.

Parents facing uncertainty amidst calls to work from home or curtailed hours will also see a “boost” to the Canada Child Benefit (CCB) in the coming months, the prime minister said.

Families receiving the CCB will see an increase of $550 on average, with an additional $300 extra per child as part of the May payment.

The feds have earmarked $1.9 billion for that measure.

Meanwhile, lower-income Canadians who qualify for a GST tax credit will receive up to $300 in May, as well as an additional $150 per child, for a total boost of $5.5 billion.

The government is also placing a six-month moratorium on student loan payments and increasing the Reaching Home program by $157.5 million to help those at risk of homelessness.

Another $50 million will be going towards women’s shelters and sexual assault centres to support those fleeing domestic violence.

And a new distinctions-based Indigenous Community Support Fund will be given $305 million to address immediate needs within Indigenous communities.

“Economic measures will ensure that our economy rebounds after this,” Trudeau said.

“Our team is in constant communication with our colleagues in the provinces and the territories, as well as Indigenous leaders and communities, to ensure that we have a co-ordinated, Canada-wide approach so that we face this and recover from this together.”

Finance Minister Bill Morneau called dealing with the COVID crisis difficult and unprecedented.

“COVID-19 is having a significant impact on our economy,” he said at a press conference following Trudeau’s announcement.

“We have your back.”

Bank of Canada governor Stephen Poloz said staff at the central bank remain in constant contact with the CEOs of the country’s big banks.

“We honestly don’t know what’s coming our way,” he said.

“We know this is a temporary thing.  We don’t know how long and how big.”

Copyright © Western Investor

Big Six and Vancity offering up to six months payment free for mortgage holders unable to make payments due to pandemic

Joannah Connolly
Western Investor

Canada’s big six banks are offering mortgage payment deferrals for up to six months for homeowners who are unable to make payments because of the COVID19 pandemic.

Neil Parmenter, president of the Canadian Bankers Association, tweeted March 18 that RBC, TD, BMO, Scotiabank, CIBC and National Bank would put the program into place “effective immediately.”

He added the banks would also offer “opportunity for relief on other credit lines.”

The message concluded with the instruction “Talk to your bank” for customers who believe they should get the relief, which will be assessed on a case-by-case basis.

In a combined press release, all six big banks said they were also working with commercial customers to provide “flexible solutions” for Canadian businesses struggling because of the virus outbreak.

On the same day, credit union Vancity announced that it was also implementing mortgage payment deferrals of up to six months for struggling homeowners.

It wrote in a statement: “Vancity initially responded by introducing a three-month loan deferral program for our members. It is clear the effects of the pandemic will last longer, so today we are announcing an extension of that deferral program for a term of up to six months. This includes mortgages and other loans and will support members facing financial uncertainty and vulnerability from the fallout of coronavirus.”

Vancity said that personal banking and business customers should contact their customer service line to find out how the credit union can help.

It wrote: “Each case will be assessed individually to help people through these difficult times… Other support for Vancity members facing financial difficulties owing to the virus include providing emergency working capital [and] buying back foreign currency at the rate it was sold, for customers impacted by travel disruption, to ensure they do not suffer financial loss.”

Tamara Vrooman, CEO of Vancity, stated, “Many people and businesses will be directly affected by this pandemic, and we’re here to support them. I encourage any members with concerns on how to deal with the impact of the Coronavirus to contact us. We will work with you to identify what supports you need, including options such as emergency working capital and mortgage payment flexibility. Vancity will continue to find more solutions during this challenging time as the situation evolves.”

None of the mortgage lenders has announced whether the payment deferrals will be interest free or whether they will accrue interest. 

Copyright © Western Investor

On February 25, Sean Morrison was named the new president of the Ontario Real Estate Association

Clayton Jarvis
REP

On February 25, Sean Morrison was named the new president of the Ontario Real Estate Association. Prior to his election as president, Morrison, who is also broker and manager for Coldwell Banker Momentum Realty and a member of the Realtors Association of Hamilton-Burlington, had served on OREA’s Board of Directors for four years, serving as a member and Chair on several OREA and RAHB committees.

He spoke to REP by phone on March 11. The following interview has been edited for length and clarity.

Real Estate Professional: Congratulations on becoming president of OREA. How did you react when you first heard the news?

Sean Morrison: To get to be the spokesperson for your profession in Ontario is incredible. It’s a huge honour, a big responsibility and something we don’t take lightly. I’m thrilled to be able to speak for a profession that’s given me an amazing career for 15 years.

REP: Some people might be curious about the process you went through. How does a person become the president of OREA?

SM: First, you have to be elected by the membership to the Board of Directors, so all of the 37 real estate boards in Ontario representing our 80,000 members will vote on who they want as their representatives on the Board of Directors. From there, you have to spend some time on the Board, you have to get a set of criteria to match to even be able to run for president. Then you put your name forward to run for president and you’re elected by your peers on the Board of Directors.

REP: What’s it going to be like balancing the demands of being the president of OREA with your responsibilities as a broker?

SM: Thankfully I’ve got an amazing management team at Coldwell Banker that was more than prepared to take over before I even put my name forward. I spoke with them, and obviously my spouse as well, to make sure they were okay with the time commitments and to understand that my first priority would be to the Association moving forward. They were in great spirits on that. They were very supportive. 

It’s really a team effort over there. That will help our agents stay at the cutting edge of everything in my absence.

REP: What has being a part of organized real estate meant for your career – and for your life? Would you recommend it to most realtors to get involved.

SM: I would 100 percent recommend that people get involved.

And it can happen in various ways. You can get involved by attending your local [annual general meeting]. You can attend committee meetings. You can be on a committee. You can run for Board of Directors of your local association or your provincial association, like I have.

As far as what it does for your career, it really broadens your horizons. You’re in the loop when it comes to what is happening in our industry, or what calls for action are happening on the advocacy front to help with things like when we defeated the municipal land transfer tax, or the Trust in Real Estate Services Act, that’s all on the back of our grassroots advocacy, and by being part of organized real estate, you get those emails, you get the information surrounding that, so that you can be more active in your profession.

Aside from that you get to meet realtors from all over your chosen area, if you’re with your local board, the province or the country, depending on what level of organized real estate you’re involved with. From a realtor’s standpoint, it can help increase their network, but also give them a broader idea of what’s going on in the market, so I think you become a more professional realtor by being involved in organized real estate.

REP: What are some of the biggest issues facing Ontario realtors? What are your plans for dealing with them?

SM: One of the biggest was our ability to incorporate. The Trust in Real Estate Services Act has rectified that. They’ve brought forward [private real estate corporations] for the final vote and they have gone through, so that will happen at some point, I’m assuming, over the next year as we draft the regulations.

What that does is allow tax fairness for realtors, so they can incorporate their business and utilize some of the funds long-term for more advertising, for more infrastructure-building projects within their own business.

As far as the market goes, we have a supply-and-demand issue in the province. While the government is taking steps toward increasing supply, realtors have to navigate that on the street.

REP: What about homeowners, buyer and seller? What are the Association’s goals for helping them?

SM: We’ve seen, over the last few years, homeownership rates dropping in Canada for the first time since Confederation, so it’s always been a priority of OREA to lobby in ways that we can have pro-home ownership legislation coming out, like the More Homes, More Choice Act that the government launched earlier this year, and to work with them on innovative solutions like laneway housing, building additional rowhouses or townhouses so we can increase the density of the housing stock available so that it will help with affordability across the province.

It’s very difficult to be a realtor without a consumer, so we have to have pro-home ownership policies coming out of OREA and supporting homeowners so we can keep that dream of home ownership alive.

REP: You’ve mentioned TRESA a few times already. How effective do you think it’s going to be in improving the experiences for consumers? What more can be done to protect them?

SM: The Trust in Real Estate Services Act is ground-breaking legislation. We’ve been lobbying for this for over a decade. What the Act does is allow for increased consumer protection and holding the real estate professional to the highest standards in North America. It also has specialty certifications in it which will allow the consumer to identify, if you were buying a commercial property or a farm property, a realtor that has that specialization and experience so that they’re protected in their transaction.

REP: What can be done beyond what’s in TRESA?

SM: I think there’s always more that can be done, and we’re working with the provincial government to keep pro-homeownership policies front of mind. We’re always looking for ways that we can offer new tools, technology, training, research to our members so that they’re more informed and ready to go into the market, which helps the consumer by having a better realtor on the other side.

REP: With realtor education transferring to Humber College at the end of 2020, will OREA still have influence in determining what skills agents will be required to have?

SM: We will no longer be doing new agent intake training, but we do offer other services – leadership training, for instance – and we do put out a lot of research for our realtor members so they can continue to stay on the cutting edge and are informed on everything that is going on.

As far as specialty certifications go under TRESA, the policies for that haven’t been laid down around what that training will be, so OREA will be involved with [the Real Estate Council of Ontario] on that every step of the way to ensure that the new training that comes out for that will make our realtors better.

REP: How concerned is OREA with the presence of online companies like Properly and Zillow? Is there a fear that these technologies are going to disrupt the industry and take some market share from flesh-and-bone realtors?

SM: Obviously, a lot of those are our members as well. As they come in, they become members of organized real estate, so we welcome all business models to come in. I don’t think there is any real concern with the new players in the market. Our concern is adapting to the present conditions and to make sure that our realtors are informed about all the choices out there, and that the consumer is informed about all the choices out there as well, so that consumers can make an educated decision and realtors can help future-proof their business.

REP: What’s OREA’s position on Airbnb? The app is coming under increased criticism for the role its playing in housing shortages worldwide, but so many clients are buying properties to specifically used as Airbnb’s – which can come into conflict with local bylaws. Is there an official position?

SM: From the association, there’s no official position on that that I’m aware of. It’s not something we would really have a position on being that it’s more in the hotel space than in the homeownership space.

REP: Does OREA have much of a say in Ontario’s transit plans?

SM: OREA’s had a lot of discussions with the provincial government about transit-oriented neighbourhoods and density around transit. We recently did a research paper that came out in partnership with T360 that talked about how millennials are looking to live around transit-oriented neighbourhoods and what kind of housing they were looking for.

They want to live close to transit. We want to work with the government on innovative solutions to housing around transit areas because people want to be closer to work.

REP: Do you find that the government’s response to OREA’s recommendations has been favourable?

SM: This government is one that is very collaborative, in our opinion. We’ve been involved in the discussions, we’ve been involved in the roundtables, and going forward I think they understand what is coming out of this research, that they have to do something around transit.

REP: What about the cancellation of the Hamilton LRT? Did the Association have a position on that?

SM: That’s more for the local association, the Realtors Association of Hamilton-Burlington. Given our position on transit-oriented neighborhoods, it’s something that is concerning. Hopefully there are some additional transit plans in the Hamilton area, but we have no official position on the cancellation of the Hamilton LRT.

REP: With over 80,000 realtors operating in Ontario, and with so many of them only selling a house or two a year, are there too many people working as realtors in the province? Isn’t the number of realtors part of the reason behind why some agents behave less than ethically to maintain their business?

SM: We would never take a position to cap the number of realtors in the province. Healthy competition is always welcome within the real estate profession. I think what it comes down to is whether those people can make a living or not. That is a personal decision at that point. If people want to work either part-time or full-time in this industry, it’s certainly not something we’re going to put a barrier to entry on.

That being said, there’s a professionalism aspect to it. As long as each member out there is conducting themselves in a professional manner, then we have no issue with how many realtors are in the province. However, if you’re going to act in a non-professional way, that’s why we have RECO, and we support RECO. Under TRESA, we actually lobbied to have the powers of RECO increase as to being able to suspend and revoke licenses of bad offenders, because as realtors, we don’t want them in the profession.   

Copyright © 2020 Key Media Pty Ltd

Home sales poised to moderate

Gerv Tacadena
REP

The COVID-19 outbreak will likely moderate house sales in the near term, according to an economist.

Brian DePratto, senior economist at TD Bank, said the current market conditions due to the impact of the coronavirus paint a bleak picture for home sales in the next months.

“That said, sales are well-positioned to make a strong recovery once the impact of the virus dissipates, helped by an ultra-low interest rate environment,” he said in a report in The Canadian Press.

DePratto said the recovery in sales once the concerns surrounding the COVID-19 ease will likely translate to price gains.

Home sales increased by 26.9% annually in February. On a monthly basis, sales were up by 5.9%, driven by the strong turnout in the Greater Toronto Area (GTA). This came with a 7.3% growth in new listings.

The healthy sales activity and the gains in listings came with a 15.2% annual growth in the national average price for homes, which now stands at $540,000. Excluding the major markets of Greater Vancouver and GTA, the national average price during the month grew by 10.5% to $410,000.

Copyright © 2020 Key Media Pty Ltd

In media relations, do no harm

Matt House
other

The global focus on COVID-19 is changing the way nearly all of us live, communicate and consume media. Much of the world finds itself at home, following news about one thing. As a result, communicators and PR pros must make adjustments.

Many companies and organizations have decided to cease public communications, advertising or marketing. For others, the show goes on. They send personnel announcements, launch products and advertise existing and new services.

Whatever path you’re following, here are tips to consider:

First, do no harm

PR disasters are lurking. As a result, it is critical that every organization audit current and planned messaging.

Begin with a road map of phrases to avoid during this sensitive time. Thinking about marketing a hands- on experience during this moment of social distancing and hygiene? Want your video to go viral when the public is trying to avoid the pandemic? Don’t. Once you’ve made this list of phrases to avoid, check your communications and marketing plans to make sure you’re steering clear of them.

Adjust expectations

It has been a long, long time since we’ve seen a media environment this crowded. The attention paid to COVID-19 makes the focus on the impeachment proceedings look like a blip on the historical radar.

Even the best roll-outs and most creative ideas will be drowned out; it would be a mistake to pretend otherwise with executives or those you represent.

As a result, it is critical that you adjust expectations when it comes to getting coverage for non-virus stories. Revise KPIs.

There is a silver lining, though: non-financial bad news won’t get as much coverage either.

Don’t watch the pitch go by

The flip side of COVID-19 crowding out most other news is that people are starved for virus stories. Every reporter is trying to figure out an angle. Food writers, financial reporters, human interest journalists, bloggers. They all need content.

Now is the time for creativity. Help media connect the dots. Do you have experts who can talk about supply chain issues? How about local retailers to explain the ways they’re accommodating social distancing and adjusting accordingly? Think creatively about inserting your voice into this moment.

Have a heart

Above all–be human. Think about the mood of your audience. People are worried. Make certain your tone and plans meet these strange times with care and thoughtfulness.

© 2020, Access Intelligence, LLC.

How will the COVID-19 outbreak impact the BC economy

BCREA

Sketching Out the Potential Impact of COVID-19 on the BC Housing Market How will the COVID-19 outbreak impact the BC economy March 17, 2020 BCREA Summary Findings: While it’s unknown how the unfolding COVID-19 outbreak will impact the economy in the long-term, BC is facing a sudden stop in economic activity with little guidance to when things may return to normal.   Based on our scenario analysis, BC home sales and prices will likely face declines in the spring and early summer but should recover along with the wider economy in the second half of the year, contingent on the outbreak resolving.   The postponed change to the mortgage stress test rate, originally slated for April 6, 2020, will mute the impact of falling interest rates for the BC housing market.

Read Full Report HERE

RBC suggests things might get rocky

Steve Randall
Canadian Real Estate Wealth

The impact of the COVID-19 coronavirus outbreak is being felt across the world, but what will it do to Canada’s housing market?”

The short answer, of course, is that no one really knows, but the latest assessment of the housing market by RBC Economics suggests that things are about to get rocky.

Senior economist Robert Hogue said that the “light was on” in the housing market in February but that it is “about to be turned off.”

“The world has changed in March,” he wrote in the RBC Monthly Housing Market Update. “And so has the outlook for the Canadian housing market.”

Hogue said that fears of the spread and social distancing are set to decimate house viewings and buyers are likely to take a wait-and-see approach.

Then there’s the impact that Canadians’ investments have suffered from falling asset values. Hogue notes that some homebuyers would be relying on these investments to fund their down payment.

Despite mortgage rates remaining low, especially following recent interest rate cuts and the potential for more, consumer confidence is likely to outrank them.

Sales plunge but what about prices? Hogue’s outlook is that home sales will plunge in the coming weeks before a rebound at some (undeterminable) point.

But he expects home values nationally to be resilient with tight supply in many markets providing a cushion against correction.

For Toronto, Vancouver, Ottawa, and Montreal, recent price escalations are predicted to cool but there could be tougher conditions for the Prairies where market conditions are softer and the oil price fall will be a further blow.

Copyright © 2020 Key Media Pty Ltd

RBC suggests things might get rocky

Steve Randall
Canadian Real Estate Wealth

The impact of the COVID-19 coronavirus outbreak is being felt across the world, but what will it do to Canada’s housing market?”

The short answer, of course, is that no one really knows, but the latest assessment of the housing market by RBC Economics suggests that things are about to get rocky.

Senior economist Robert Hogue said that the “light was on” in the housing market in February but that it is “about to be turned off.”

“The world has changed in March,” he wrote in the RBC Monthly Housing Market Update. “And so has the outlook for the Canadian housing market.”

Hogue said that fears of the spread and social distancing are set to decimate house viewings and buyers are likely to take a wait-and-see approach.

Then there’s the impact that Canadians’ investments have suffered from falling asset values. Hogue notes that some homebuyers would be relying on these investments to fund their down payment.

Despite mortgage rates remaining low, especially following recent interest rate cuts and the potential for more, consumer confidence is likely to outrank them.

Sales plunge but what about prices? Hogue’s outlook is that home sales will plunge in the coming weeks before a rebound at some (undeterminable) point.

But he expects home values nationally to be resilient with tight supply in many markets providing a cushion against correction.

For Toronto, Vancouver, Ottawa, and Montreal, recent price escalations are predicted to cool but there could be tougher conditions for the Prairies where market conditions are softer and the oil price fall will be a further blow.

Copyright © 2020 Key Media Pty Ltd

Vancouver West End MLA Spencer Chandra Herbert gathering info and feedback on rental issues

Naoibh O’Connor
Western Investor

Vancouver West End MLA Spencer Chandra Herbert, the premier’s advisor on rental housing, has been tasked with gathering information and feedback on how to handle rental issues emerging due to COVID-19.

During a press conference, Premier Horgan said these are among the many issues the province has on its plate, and government is looking at next steps, using a cross-governmental approach.

“It’s not just individual renters that are concerned. Businesses who have rents to pay and no customers coming in the door are equally concerned. So we have a whole range of issues that are piling up and we’re looking at what mechanisms we have to assist these individuals,” he said at the press conference March 17.

“But I want to stress, as I did on Friday, the objective of our government is to provide services for people. That’s why we’re here. We do not want to come up short. I’ve made that clear to deputy prime minister Chrystia Freeland in our daily discussions — that we all need to work on this together.”

Chandra Herbert, meanwhile, headed up the three-person rental housing task forced that criss-crossed the province in 2018 to come up with recommendations to modernize the Rental Tenancy Act.

Chandra Herbert is now reaching out to many of the same people and groups he dealt with on that file to make short-term and long-term recommendations with respect to the impact coronavirus will have on renters and rental housing.

“It’s quick work in terms of short-term [recommendations] given rents come due at the end of the month. We’ll have to be looking at that as an issue. We’re looking at how to support renters, but also landlords — there’s a number of smaller landlords [for whom] the rent cheque is often also the mortgage cheque,” he told the Courier March 17.

“Tomorrow, I understand, the federal government will be making major announcements around rents, in part. We don’t have an early preview of that, but it will inform the work.”

Chandra Herbert has already put out calls to organizations such as the B.C. Non-Profit Housing Association, the Tenant Resource and Advisory Centre and LandlordBC. Within government, he’ll be checking in with B.C. Housing, as well as Vancouver and Victoria’s rental advisory committees.

“It’s not everybody under the sun — we have to work faster than that — but I’m doing my best to get out to as many folks that have key experience in this work,” he said. “I’ve set my own deadline — as soon as possible. The sooner we can get action, the sooner people have some peace of mind, which is in short supply right now.”

Challenges are numerous as April 1 approaches and rent becomes due. Some workers have already lost jobs while others are at risk of losing them. Some residents are in quarantine or self-isolation. Landlords of smaller and larger buildings, meanwhile, as well as those who rent suites in their homes, face mortgage payments.

“[Some renters] may not be able to get rent money because they’re not working or they may have been laid off — if you’re a casino worker or somebody in the entertainment industry, for example — the film business,” Chandra Herbert said. “In many cases, people are one paycheque away from not being able to afford rent.”

But, he added, some relief sooner than later, depending what the federal government announces Wednesday.

“CMHC on the federal level has said they’re looking at mortgage deferrals and questions like that. But really, [after] we hear what the federal cabinet is announcing tomorrow, we’ll see what we, as a province, needs to do,” he added.

“They have a considerable fiscal firepower at their disposal. We’ll watch them and then see what more we can do. Certainly, we’ve been encouraging the federal government to look at the challenge of renters, of course, the challenge with mortgage holders, people in the gig economy who might not qualify for EI, and that kind of thing.”

Under the province’s current Residential Tenancy Act, meanwhile, evictions are still possible — an issue renters’ advocates want addressed. Changes could come.

“Most folks aren’t paying rent until the end of this month, so it’s all on the table,” Chandra Herbert said.

Copyright © Western Investor

Ottawa will launch a revised insured Mortgage Purchase Program

Steve Randall
Canadian Real Estate Wealth

The Canadian government has announced a further measure to mitigate the impact of the COVID-19 crisis and to help maintain stability in the financial system.

It will launch a revised Insured Mortgage Purchase Program (IMPP) which will see up to $50 billion of insured mortgage pools purchased through the Canada Mortgage and Housing Corporation (CMHC).

It means that banks and mortgage lenders will have stable funding to continue to lend to consumers and businesses.

The government highlights that this does not pose additional risk to taxpayers as the insured mortgages being purchased are already backed by the government.

“These events remind us all how crucial it is to have a safe and affordable place to live. CMHC exists in part to buffer the effects of events such as the COVID-19 virus pandemic, which affect the health and stability of Canada’s financial system. This is what we do. We are part of a federal team that is working hard together to ease the impacts on Canadians,” said Evan Siddall, president and CEO of CMHC.

Earlier this week, the Office of the Superintendent of Financial Institutions (OSFI) announced measures to shore up finances of the institutions it regulates and the suspension of the planned changes to the mortgage stress test.’

Copyright © 2020 Key Media Pty Ltd