Eby says SROs not an acceptable answer

Katie Derosa
The Province

Says they must be phased out, but critic charges he did nothing about that as housing minister

 Hastings Tent City residents and allies prepare for a news conference earlier this week in front of the abandoned site of the city-owned Balmoral Hotel.

Activists decry the displacement of people living in tents in the Downtown Eastside, but David Eby says as premier, he would bring together all levels of government to address the problems in the neighbourhood.

The B.C. NDP leadership candidate told Postmedia that problems have been neglected for too long, and that he would phase out single-room occupancy buildings, as they are an inadequate solution for housing people.

“These are not acceptable government housing services, which is essentially what these residential hotels are,” Eby said. “So we need to phase them out.”

But Green party MLA Adam Olsen slammed the former housing minister for not spearheading such an approach when he had the power to do so.

“It’s fine for the former minister of housing to say, `This is what should happen.’ The question that I have is, `Why hasn’t this happened?’” said Olsen, MLA for Saanich North and the Islands. “He’s been the minister of housing up until just a few weeks ago.”

Last week, City of Vancouver staff began the process of removing tents and structures from the sidewalk on East Hastings Street.

Eby, who resigned as housing minister and attorney general to run for the leadership, suspects many of the people living in tents right now have single-room occupancy hotel rooms “that the government is paying for, that are unlivable.”

Many of the rooms, he said, have no windows or windows that don’t open, conditions that are unbearable in hot temperatures.

“We need to replace them with appropriate housing. We need to find a way to increase housing options in the neighbourhood for low-wage workers as well.”

Eby said when he worked in the Downtown Eastside during his time with Pivot Legal Society, the federal government, the province, City of Vancouver and community groups worked together to address the neighbourhood’s challenges through the Vancouver Agreement which began in 2000 but expired in 2010.

Since the collapse of that agreement, “there really hasn’t been a co-ordinated strategy or a plan about how we get out of the problems of the Downtown Eastside,” he said.

“I think essentially putting an invisible fence around the neighbourhood and saying `this is the best we can do’ and just hope that things work out, it’s a strategy that will no longer carry us forward.”

Eby said if he’s successful in his bid to replace Premier John Horgan, who is retiring, he’ll co-ordinate a long-term response to the issues in the Downtown Eastside with the help from the federal government, the city and concerned groups.

© 2022 The Province

Despite the hype, B.C. still has just two wooden highrises

Douglas Todd
The Vancouver Sun

Mass-timber towers, like UBC’s 18-storey Brock Commons, are called the best way to reduce the carbon emitted by concrete highrises. Why are there so few of them?

The dream of greener buildings is why an international buzz was created when designs were announced for a 40-storey wooden building, dubbed Canada Earth Tower, at 1745 West 8th in Vancouver. But it’s been stalled. Photo by Delta Group and Perkins and Will /PNG

During heated debate over the Broadway Plan, Vancouver city council responded with a concerted effort to pave the way for more mass-timber highrises.

But despite years of talk about such structures, only two have been built in B.C.

Stung by complaints that the hundreds of highrises intended for the Broadway corridor would be conventionally made of concrete, which produces massive greenhouse gas emissions, council scrambled in May to make its dramatic densification push fit with its 2020 climate plan, which promises to reduce carbon emissions in Vancouver by 40 per cent by 2030.

Sean Pander, manager of green buildings for the city, said the Broadway Plan stipulates that “new construction should explore innovative low-carbon building technologies, such as mass-timber construction” and “where possible, allow simplified building forms to facilitate the use of mass timber and other low-carbon building materials.”

Prodded by Broadway Plan opponents such as sustainability specialist Paul Morris, Vancouver council decided in May to change the building bylaw to allow mass timber outright up to 12 storeys, a hike from the previous cap of six storeys. Pander said council’s climate goals will ultimately “increase demand for mass timber buildings, like the 18-storey mass-timber student-housing building at UBC.”

Today, 12 storeys remains the city limit for a mass-timber structure, unless a builder can “demonstrate they meet the safety requirements of the building bylaw” through a so-called “alternative solution.”

Mass-timber towers, like UBC’s 18-storey Brock Commons Tallwood House, are often held up as the best way to reduce the immense amounts of carbon emitted by concrete-and-steel highrises in their construction and operation.

Brock Commons, a student residence, was the world’s highest contemporary wood highrise when it was completed in 2017 to many awards. Even though most of it, except for a common area and some exterior cladding, doesn’t look or feel particularly woodsy, Vancouver architect Michael Geller joined many in imagining it as a big part of the future of urban density.

But that was five years ago. Such towers remain rare, despite so-called “cross-laminated timber” technology being around for a couple of decades.

Brock Commons, at 53 metres (174 feet), is no longer the record holder for height. In a small town in forested Norway, a higher all-timber tower, Mjøstårnet, recently went up to 85.4 metres (280 feet). And a 87-metre (284-foot) luxury residential tower named Ascent MKE is nearing completion in Milwaukee, Wisconsin.

But the existence of three 18-storey-plus timber highrises in isolated locations is set against cities around the world packed with hundreds of thousands of concrete and steel highrises, which are generally defined as structures of 12 storeys and taller.

Metro Vancouver has more than 1,000 concrete highrises. And there are countless more coming, including in the city of Vancouver as its politicians try to increase population density in the core to ostensibly decrease commuting times and carbon fumes.

The big problem with concrete is the cement needed to make it, says Morris. When cement is created by roasting limestone and various compounds at high temperatures, it releases a tremendous amount of carbon. Chatham House, a British think-tank, says the annual production of four billion tonnes of cement causes eight per cent of world carbon emissions, much more than the airline industry’s two per cent.

 UBC’s Brock Commons Tallwood House, a student residence, was the world’s highest contemporary wood highrise when it was completed in 2017 to praise and many awards. Why have so few, including UBC, followed its lead? Photo by NICK PROCAYLO /PNG

Timber pillars reduce carbon dioxide emissions

Given the radically lower carbon advantages of wood, why are so few highrises made of this sustainable material?

Wood is a fifth the weight of concrete, which reduces the energy used for its transportation and cuts the need for massive foundations. Wooden buildings also require less insulation and less mechanical ventilation, says Morris.

Importantly, since the thick pillars in tall wooden buildings are made of trees, they retain carbon dioxide captured from the atmosphere as the trees grew.

The carbon-sequestering properties of wood confer a huge environmental benefit. The Journal of Sustainable Forestry estimated that substituting wood for current construction materials would annually save 14 to 31 per cent of global carbon dioxide emissions.

And many people simply find wood more esthetic. A New Yorker writer described Norway’s 18-storey wood building as “seductively calming” and its exposed five foot by two feet beams seemed “smooth, resonant, and much less cold than a metal pillar would have been.”

There are even peer-reviewed studies led by Cornell University’s Christina Kelz and others that have shown children who attend school in educational buildings with wooden walls and furniture have lower heart rates.

This kind of research encouraged the B.C. Forests Ministry in 2021 to put taxpayer money into a mass-timber demonstration program, which can be found at naturallywood.com.

The dream of greener buildings is also why an international buzz was created more than three years ago when a rezoning application was announced for a 40-storey wooden building, dubbed Canada Earth Tower, at 1745 West 8th in Vancouver. But it stalled for years as council reviewed the Broadway Plan. Now that the plan for much taller towers in the area is approved, says Vicki Su of Perkins & Will architectural firm, the Earth Tower project will be re-evaluated.

B.C’s forestry innovation website boasts “mass timber has been used in over 370 buildings in B.C. since 2007.”

But there remain only two completed mass-timber highrises in the province, says Sukh Johal, senior manager for Wood Works B.C. and the Canadian Wood Council. 

They are Brock Commons and Tallwood 1, a 12-storey residential-commercial building in the Victoria suburb of Langford, said Johal. A 10-storey wood building, called the Capstone, is under construction in Kelowna.

Several other wood tower plans have been made public in the past few years, Johal says, but it’s impossible to summarize whether they will get final approval, maintain financial feasibility or otherwise go ahead.

B.C.’s forestry innovation investment website says two of the major would-be projects are a 10-storey office building planned by BentallGreenOak in Vancouver’s False Creek Flats and Westbank’s 21-storey timber residential building, dubbed Prototype, for Vancouver’s Mount Pleasant.

Given such a short list, the question remains: Why are there so few mass-timber highrises in Canada and especially B.C. — given that two thirds of the province is covered in forest?

There are many reasons that visions of timber highrises have been so slow in coming to reality. Some are psychological. Some are technical. The mass-timber industry says both concerns can be overcome.

Another #fire in #Vancouver during the construction of a four storey #wood building. When wood advocates say wooden builds are safe, think twice. Buyer be aware.

  Overcoming old fears of fire

“Another fire in Vancouver during the construction of a wood building,” began a 2020 Tweet by Michael McSweeney, then-head of the Cement Association of Canada. “When wood advocates say wooden builds are safe, think twice. Buyer be aware,” McSweeney went on, attaching images of a blazing wooden apartment building.

It was one of many times the recently retired head of the Cement Association has raised the alarm about fires in wooden buildings.

Cautious fire chiefs have also for years raised worries about whether wood buildings are too vulnerable. But attitudes are shifting and technology is advancing. Researchers are finding, as are fire officials, that glue-laminated timber beams tend to merely char on the outside two or three centimetres, a bit like tree trunks in a forest fire. 

Still, fear of fire appears to be the key reason Canada’s National Building Code generally restricts mass timber buildings in the country to 12 storeys, says Peter Moonen, sustainability manager for the Canadian Wood Council. 

Most developers hold back on erecting mass-timber highrises because they’re waiting to see what happens when others do it, says Peter Moonen of the Canadian Wood Council. Photo by Submitted by subject /jpg

For Brock Commons, UBC officials obtained dispensation to go above 12 storeys by making a strong site-specific case, according to Moonen.

Regrettably, Moonen said, the developer of Brock Commons had to address fire chiefs’ fears by “encapsulating” virtually every one of its interior walls in three layers of Gyproc drywall, which is especially fire resistant.

“It added a lot of mess and a fair bit of cost,” said Moonen, although it did help the UBC project get erected on time and on a budget similar to a concrete and steel tower.

The good news, Moonen said, is that lumber officials, firefighters and insurance brokers are increasingly taking part in staged demonstration burns of timber structures.

Len Garis, former president of the Fire Chiefs Association of B.C., has been among those defending their safety.

That said, UBC is building the second phase of Brock Commons’ student residences out of conventional concrete. Asked why, a spokesperson said Tallwood House was a “unique demonstration project.”

 Even though UBC’s Brock Commons Tallwood House (background right) was built in 2017, the new residences of Brock Commons Phase 2 are being constructed with concrete.

Possible obstacles to mass-timber highrises

Lack of innovative spirit

Most Canadian builders are not famous for their sense of adventure, says Moonen.

Most developers hold back on erecting mass-timber highrises, he says, because they’re waiting to see what happens when others do it.

“It’s maybe why Canadians are satisfied with bronze medals,” Moonen says.

He also regrets that architecture, trade schools and others don’t show leadership in teaching students how to work with cross-laminated timber, including its special ability to be accurately machined. “It’s like offering a chef’s course and not teaching about how to cook with vegetables.”

Is timber ‘too’ light?

Although one huge advantage of wood is that it’s far lighter than concrete, Lloyd Alter, an architectural writer who teaches sustainable design at Toronto Metropolitan University, points out that engineers added concrete to the top floors of Norway’s wooden highrise because it was next to a windy lake. The wooden structure was in danger of swaying too much, causing residents to feel nauseated. 

There is little downside to plantation forests, which are managed forests in which the trees are planted for the maximization of wood fibre, says Lloyd Alter, architect, real estate developer. jpg

The lightness of mass timber is also one of the reasons wooden highrises are still made with concrete foundations, albeit of far less mass than for conventional construction.

How does the cost of mass-timber highrises compare?

“Cross-laminated timber is not cheap,” says high-profile Seattle architect Matthias Olt. “It is more expensive per unit than steel or concrete. The savings comes in reduced labour costs. The number of construction workers required on-site is cut in half.”

Wood buildings, he said, also last longer.

Why go over 12 storeys anyways?

Alter is among the architects and planners who believe it’s unwise to go higher than 12 storeys, whether a building is of concrete or wood.

Several researchers, notably Edinburgh Napier University’s Francesco Pomponi, have found buildings under 12 storeys produce less carbon emissions and create better communities.

Despite protests, forests can be grown in sustainable ways

More than 18,000 trees were required to build the Mjøstårnet in Norway, where the country’s pine and spruce trees tend to be smaller than the fir and hemlock of British Columbia.

While some environmentalists don’t want to see any old-growth trees cut down to produce buildings, many others, including Alter, say there is little downside to plantation forests, which are managed forests in which the trees are planted for the maximization of wood fibre.

As Moonen, who lives on the green slopes of the Sunshine Coast mountains, says: “We should be coming up with the brightest and best uses for what we grow in our own backyard.”

[email protected]

@douglastodd

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© 2022 Vancouver Sun

Maple Ridge 1.39-acre auto recycler business sells for $6.88 million

Western Investor Staff
Western Investor

Sale of industrial land and 7,900-square-foot building said to set record price for Metro Vancouver suburban city.

Royal LePage Westside Klein Group, Vancouver, for Western Investor

 

Property type: Industrial

Location: Kanaka Business Park, 13176 Lilley Drive, Maple Ridge, B.C.

Property size: 7,900 square feet

Land size: 60,584 square feet

Land size in acres: 1.39 acres

Business: Auto recycler

Zoning: M2 and M5 (specific to auto recyclers)

List price: $6.99 million

Sale price: $6.88 million

Date of sale: August 15, 2022

Brokerage: Royal LePage Westside Klein Group, Vancouver

Broker: Dmytro Chernysh

 

© 2022 Western Investor

Where are interest rates headed for the rest of 2022?

Fergal McAlinden
other

The year to date has already seen its fair share of surprising news where variable and fixed rates are concerned

 It may seem hard to believe, but 2022 will soon be entering its closing stretch as the summer ends and fall comes into view.

For Canada’s housing and mortgage markets, there could be plenty of twists and turns ahead yet with three remaining interest rate announcements scheduled by the country’s central bank for the remainder of the year – on September 7, October 26, and December 7.

Bank of Canada rate hikes have been some of the most prominent stories of the year to date, the institution having raised its benchmark rate by a total of 2.25% in a series of announcements since March in response to swelling inflation.

While the country’s inflation rate hit a near-40-year-high in June of 8.1%, that figure fell to 7.6% last month, the first time consumer price index (CPI) inflation has fallen on a yearly basis for over two years.

That remains well above the Bank of Canada’s target 2% rate, a fact that means rate hikes are unlikely to slow or stop for the remainder of the year, according to one market observer.

Daniel Finkelberg (pictured top), mortgage agent with DLC Clear Trust Mortgages Inc., told Canadian Mortgage Professional that he expected further increases to variable rates, which are heavily influenced by central bank rates, before the end of the year.

“I do believe that variable rates will continue to increase,” he said. “I think that they’re increasing as a function of fiscal monetary policymakers setting guidance and understanding the reaction of inflation to that guidance, and that will continue to occur until they stabilize inflation to a certain degree.”

Read next: Canada’s inflation rate slows in July

A noteworthy trend in recent weeks has seen five-year fixed rates decline in line with falling bond yields, adding to an unpredictable housing market whose pace has cooled significantly over the last six months.

Still, Finkelberg said the market slowdown had been a somewhat uneven one, with specific areas registering more pronounced drops in sales and prices than others.

“The correction in the real estate market is an interesting one because you find tertiary markets that are dropping significantly more than certain pockets in the city,” he said. “And I think that’s natural that certain areas are not going to correct to the degree that people think they’re going to correct, because there’s still a ton of demand and not a lot of supply.”

That could see first-time homebuyers enter the market in increasing numbers in the coming months, he added, as investors bide their time before making a judgement call on whether to take the plunge.

“I believe that we’re going to see a flooding of first-time homebuyers into the market during these times,” he said, “whereas investors are taking a little bit of a step back trying to understand what is effectively ‘rock bottom’ before they enter the market.”

Those shifting conditions for mortgage holders mean that homeowners on a variable rate may be considering locking into a fixed one to stave off the uncertainty surrounding the future of variable rates.

Whether that’s a solid option depends on several factors, Finkelberg said, including the remaining term and length of the new one.

Read next: What will the next Bank of Canada hike mean for homeowners?

“I don’t know if it makes sense to take a five-year fixed during uncertain economic times because it’s a decision that you’re going to have to live with well beyond any economic correction,” he explained.

The potential Interest Rate Differential (IRD) penalty associated with fixed mortgages means that existing fixed-rate borrowers who may wish to avail of a variable rate when the Bank of Canada begins to slash rates in the coming years could be faced with a stiff charge for doing so.

“For you to take a five-year fixed with a potential IRD penalty today may not make as much sense as to take a two- or three-year fixed if you’re somebody that’s risk averse, and [wants] to really understand and let the market correct over the next two to three years,” Finkelberg said.

Some lenders offer the additional option of a variable-rate mortgage with a fixed payment, he added, allowing borrowers to mitigate their cash flow during challenging times – meaning that in many cases, the variable option is the more sensible one.

“A five-year variable allows you the opportunity to lock in,” he said, “as well as giving you some of that comfort over the next two to three years as the market is correcting.”

 

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‘Softer’ values for detached homes bringing buyers back into the market, RE/MAX study finds

Shantae Campbell
The Vancouver Sun

Second-quarter home sales increased across 40% of GTA neighbourhoods

 Homes in Toronto. Photo by James MacDonald/Bloomberg files

Canadians seeking detached homes have returned to the market amid “softer” values in the second quarter, according to a new release from Re/Max Canada.

Story continues below

The report compared market activity in the first and second quarter of 2022 in terms of unit sales and prices, analyzing 60 Toronto Regional Real Estate Board (TRREB) districts, 16 regions within the Real Estate Board of Greater Vancouver (REBGV) and six areas in the Fraser Valley Real Estate Board (FVREB). Re/Max found an increase in second-quarter home sales across 40 per cent of Greater Toronto Area neighbourhoods and 31 per cent of the Greater Vancouver region, compared to Q1.

“For those buyers that were active in (the second quarter), improved housing affordability due to easing prices and the threat of higher rates down the road clearly provided the impetus for many to leap into detached homeownership,” said Christopher Alexander, president of Re/Max Canada, in Thursday’s release.

According to the report, there have been some existing sellers in the City of Toronto who have used the opportunity to trade up to larger homes or more desirable neighbourhoods closer to the city. “The difference between the selling price of an existing property and the purchase price of a new one … has narrowed considerably,” the report said, a shift that can work in favour of the buyer given mortgage portability. Condominium owners have also benefited as values for their apartments and townhomes have remained relatively stable, while detached housing values have softened.

In the City of Toronto, the benchmark price of a detached home was $2,073,989 in February. In July, it fell to $1,515,763, according to TRREB. Meanwhile, the benchmark price for condominiums in the City of Toronto was $738,930 in July, down from the most recent peak of $840,444 in March but still up seven per cent over last year.

In Vancouver, the discounts are not as pronounced. For example, in April, detached homes saw a benchmark price of $2,139,200 compared to $2,000,600 in July.

“Buyers shouldn’t expect big bargains,” Elton Ash, executive vice-president at Re/Max Canada, said.

“Sales-to-active listings remain squarely in balanced territory overall and even tight in some areas. In Vancouver, for example, supply was lower this June than last in 50 per cent of markets, and sales are down accordingly. This trend will likely keep prices fairly stable moving forward,” Ash said.

Despite the softening in housing markets overall, active detached housing listings in June were running almost 19 per cent below the 10-year average in the GTA, approximately 12 per cent below the 10-year average in the GVA, and close to nine per cent below the 10-year average in the Fraser Valley. The decline in listings comes at a time when builders are pulling up stakes and shelving proposed developments due to softer demand. While the impact of those decisions will not be felt immediately, the decision to withdraw will significantly affect housing markets in these major centres down the road.

Canada is set to welcome over 430,000 immigrants annually until 2024, as stated in the federal government’s revised target released earlier this year. Fifty per cent of those newcomers will reside in the GTA.

“Inventory remains a puzzle that policy can’t solve in the foreseeable short or long term,” Alexander said. “It’s a real challenge, as the supply of detached homes remains low from a historical perspective and also in the context of population growth and future needs. This will remain a crucial factor impacting Toronto and Vancouver, which are now seen as world-class markets.”

 

© 2022 Vancouver Sun

Housing affordability deteriorates to new lows

Mika Pangilinan
other

Q2 marks “worst quarterly and annual deteriorations in 41 years”

Housing affordability across Canada continued to decline during the second quarter of the year, hitting the worst level of deterioration since the 1980s.

According to a recent report from the National Bank of Canada, mortgage payments now account for 63.9% of household incomes nationwide. This is a jump of 10.4 points from the previous quarter and 19.1 points from last year, marking the “worst quarterly and annual deteriorations in 41 years.” 

Regionally, all 10 of the markets included in the report saw affordability worsen for the sixth consecutive quarter. This deterioration was most evident in Vancouver, Victoria, and Toronto where mortgage payment as percentage of income (MPPI) exceeded 90% for all dwellings. The MPPI in Quebec, Winnipeg, and Calgary, meanwhile, were among the lowest at around 30% for all dwellings.

Q2’s record-low in affordability was largely the result of rising mortgage interest rates, with the five-year benchmark mortgage rate increasing 123 basis points. Steep home prices also contributed to the deterioration. Seasonally adjusted home prices jumped 5.1% on a quarterly basis, landing on a median price of $810,986. By comparison, income rose by only 0.8%.

 

Copyright © 1996-2022 Key Media, Inc.

Lumber prices welcome “summer slowdown” with a dip

Mary Or
other

Interestingly, the price is nearly exactly where it was in 2020

Softwood lumber and panel prices dropped in Canada on the holiday-shortened week as customers kept well-stocked with wood, and producers saw shrinking order files. For the week ending August 5, the price of benchmark softwood lumber item Western Spruce-Pine-Fir (WSPF) 2×4 #2&Btr KD went down to USD610 mfbm – a $74, or 11%, dip from the previous week according to weekly forest products industry price guide Madison’s Lumber Reporter. This represents a decrease of $61, or 9%, from a month ago, and an increase by $71, or 13%, from the same week last year.

Western US sawmills were unable to extend their order files past the weeks of August 15 and 22.

According to producers of WSPF commodities in the US, August kicked off with weak demand that set the tone for the following weeks despite lower asking prices. While lumber traders in Eastern Canada saw a similar sag in sales and prices, the price dive was considered part of a normal, summer slowdown this time of year, when buyers are absent from the market to enjoy their vacation and those who participate stick only to their immediate needs.

Sawmill order files are around two weeks out, with the lion’s share of production available for mid-August shipment. Quebec producers and construction workers will finish their two-week summer shutdown hiatus on Monday next week.

Madison’s Lumber Reporter noted that the current lumber price is nearly identical to what it was two years ago but hesitated to conclude a similar trend line for the rest of the year considering the difference in circumstances between now and 2020. Now, factors such as increasing mortgage rates, dampening home sales and prices, and a steadily rising ratio of investors buying property will undoubtedly have a “powerful effect” on lumber prices, the industry price guide said.

 

 

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Sought-After Neighbourhoods Keep Vancouver and Toronto Housing Market Hot

Lydia McNutt
other

 Softer detached housing values prompt new round of home-buying activity in hot pockets of Greater Vancouver and Greater Toronto housing markets

Q2 detached home sales up in 40% of GTA pockets, 31% of GVA, compared to Q1

While detached housing values show substantial year-over-year gains in the first half of 2022, successive increases to the Bank of Canada’s (BOC) overnight rate put a damper on price appreciation in the second quarter of the year in regions across the Greater Vancouver and Greater Toronto housing market, according to a report released today by RE/MAX Canada.

To illustrate, the RE/MAX Canada 2022 Hot Pocket Communities Report compared market activity in the first and second quarter of 2022 in terms of unit sales and prices, analyzing 60 Toronto Regional Real Estate Board (TRREB) districts and 16 regions within the Real Estate Board of Greater Vancouver (REBGV), and six areas in the Fraser Valley Real Estate Board (FVREB). In the Greater Toronto housing market, the Central and West End of the 416 held up relatively well in terms of average price while Durham, Peel, York, Halton and Dufferin surrendered some of the staggering gains realized in recent years. Preliminary estimates of Q2 median prices in Greater Vancouver’s Squamish area and the Sunshine Coast were comparable to first quarter figures, while West Vancouver and Vancouver West/Howe Sound reported moderate increases.

“Buyer sentiment changed virtually overnight as growing geopolitical concerns and spiralling inflation destabilized global markets, leaving the Bank of Canada little option but to raise interest rates,” says Christopher Alexander, President, RE/MAX Canada. “Those fast and furious incremental increases placed downward pressure on housing sales and prices, improving affordability on one hand, but eroding it on the other.”

Price Trends in the Greater Toronto Housing Market

RE/MAX found that second quarter values in the Greater Toronto housing market were 10 to 15 per cent below Q1 levels in Durham (-14.6 per cent), York (-12.9 per cent), Halton (-12.7 per cent), Dufferin (-12 per cent) and Peel (-11.2 per cent). Just 15 per cent of GTA markets noted an uptick in average price in the second quarter of the compared to the heated first. Five of those markets are located in the central core, including Dufferin Grove, Little Portugal, Trinity-Bellwoods, Palmerston-Little Italy and Kensington-Chinatown (C01); Yonge-St. Clair, Casa Loma, Wychwood and the Annex (C02); Forest Hill South, Oakwood-Vaughan, Humewood-Cedarvale and Yonge-Eglinton (C03); Mount Pleasant East and West (C10); and Leaside and Thorncliffe Park (C11). Three are in the West End, including High Park North, Junction Area, Runnymede-Bloor West Village, Lambton-Baby Point, Dovercourt-Wallace, Emerson and Junction (W02); Stonegate-Queensway (W07); and Islington City Centre, West Etobicoke, West Mall, Markland Wood, Eringate-Centennial-West Deane, Princess, Rosethorn Edenbridge, Humber Valley, Kingsway South (W08). One market that experienced price growth is located the East End – South Riverdale, Greenwood-Coxwell, Blake-Jones and North Riverdale (E01).

View & download GTA heat maps

“Given that the core has traditionally been more resilient, bolstered by strong demand, a finite supply of homes available for sale, higher household incomes, and greater equity at the top end of the market, the results are not unexpected,” says Alexander. “The price softening was clearly more evident in suburban areas and the outer perimeters of the 416, most of which experienced strong upward momentum during the height of the pandemic as buyers sought to leave the city.”

Price Trends in the Greater Vancouver and Fraser Valley Housing Market

Also bucking the downward trend in the Greater Vancouver housing market in terms of preliminary estimates of Q2 median values are the core regions of Vancouver West (+2.4 per cent) and West Vancouver/Howe Sound (+8.2%). Squamish and the Sunshine Coast also held steady, with no change reported between the first and second quarters. Seventy-five per cent of markets in Greater Vancouver, however, experienced a downturn in Q2 median values, coming off peak levels reported in the first quarter of the year. Most of the declines reported were below 10 per cent, with one outlier – Whistler/Pemberton, which fell by just over 16 per cent ($3,020,000 vs. $3,622,500). Given fewer sales and the types of detached properties in that particular market, an increase in the number of homes sold at lower price points could drag the median price down. In the Fraser Valley, percentage declines in average price ranged from a low of just over three per cent in Langley to a high of close to 13 per cent in Delta – North between the first and second quarter.

View & download GVA heat maps

Prices Easing, But Housing Market is Relatively Stable

“While we have seen some easing in prices, the sky is nowhere near falling,” explains Elton Ash, Executive Vice President, RE/MAX Canada. “In fact, there is relative stability in terms of market conditions, so buyers shouldn’t expect big bargains. Sales-to-active listings remain squarely in balanced territory overall and even tight in some areas. In Vancouver, for example, supply was lower this June than last in 50 per cent of markets and sales are down accordingly. This trend will likely keep prices fairly stable moving forward.”

RE/MAX REALTORS® also noted a reversal in pandemic trends over the past six months, as work-from-home situations change and buyers rethink the exodus to suburban and rural areas. Second-quarter detached home sales rose year-over-year in 40 per cent (24/60) of regions across the Greater Toronto housing market, with the vast majority of increases noted the 416 area code (20/60). However, affordable price points also continued to draw buyers. Durham Region was also a hot spot with half of its markets reporting an uptick in home-buying activity (4/8).

The Greater Vancouver housing market experienced an increase in sales in 31 per cent of regions (5/16), including Island-Gulf, North Vancouver, Squamish, Sunshine Coast and Whistler/Pemberton.

“For those buyers that were active in Q2, improved housing affordability due to easing prices and the threat of higher rates down the road clearly provided the impetus for many to leap into detached home ownership,” explains Alexander. “Greater selection, particularly in coveted hot pockets, also played a significant role in April and May as the pandemic-fuelled buying spree drew to a close. Buyers locked into five-year fixed terms as the overnight rate hovered between one per cent in early April to 1.5 per cent in early June.”

There have been some existing sellers who have used this opportunity to trade up to larger homes or more desirable neighbourhoods closer to the city. The ‘spread’ – the difference between the selling price of an existing property and the purchase price of a new one – has narrowed considerably, and given mortgage portability, the move can work in favour of the buyer. Condominium and strata owners have also seen benefits in the “spread” as values for their apartments and townhomes have remained relatively stable, while detached housing values have softened.

“Buying intentions overall are expected to remain healthy, even if some buyers pause temporarily,” says Ash. “While interest-rate hikes have edged up carrying costs, we can’t discount the effect of the tight rental market, which has seen average rents increase by double-digits year-over-year in the GVA and GTA. As potential buyers face those realities, many will still conclude that the benefits of ownership make better financial sense.”

Several regions in the Toronto housing market stood out in terms of sales. Some of the areas that have seen the greatest activity include the West End, where a single-detached home on a 50-ft. lot with a price tag under $1.5 million is still a possibility. Both W04 (comprised of Yorkdale-Glen Park, Briar Hill-Belgravia, Maple Leaf, Rustic, Brookhaven-Amesbury, Beechborough-Greenbrook, Mount Dennis, Weston and Humberlea-Pelmo Park) and W06 (which includes Alderwood, Long Branch, New Toronto, and Mimico) noted an uptick in sales in the second quarter compared to the first, with the average price in W04 hovering at just over $1.3 million and the average in W06 sitting at just under $1.5 million.

The East End of the Toronto housing market saw sales climb 26.5 per cent in E01 in the second quarter compared to the first. With close proximity to the downtown core and the Lake Ontario shoreline, and an average price of $1,863,815, this community has proven exceptionally hardy under current circumstances.

Those seeking affordability helped prop up second-quarter sales in Ajax, Whitby, Clarington and Scugog in Durham Region. With the average price of a single-detached home hovering at just over $1 million in Clarington to just over $1.2 million in Ajax, the region has an abundance of entry-level product for cost-conscious buyers.

Properties at higher price points have also proven resilient across the Greater Toronto housing market, with detached sales over $2 million up 10 per cent in the first half of the year compared to the same period in 2021. Not surprisingly, the softening in overall price has brought out the bargain hunters in the luxury segment, which would explain the increase in sales in Bedford Park-Nortown, Lawrence Park North and South (C04), Rosedale, Moore Park (C09) and Leaside (C11) in the central core, where average prices hovered at just under $3 million, $4.1 million and $3.126 million respectively in the second quarter of the year.

Some of the most durable areas in the Vancouver housing market include Burnaby, Coquitlam and Port Coquitlam. These established communities are drawing purchasers who are looking for affordable detached housing with good accessibility to the downtown core, with preliminary estimates of the Q2 median values ranging from just $1.445 million in Port Coquitlam to $2.12 million in Burnaby. North Vancouver and Squamish have also held up well, with both experiencing rapid growth well before it was further accelerated by the pandemic.

Active Inventory Down in GTA & GVA

Despite the softening in housing markets overall, active detached housing listings in June were running almost 19 per cent below the 10-year average in the GTA, approximately 12 per cent below the 10-year average in the GVA and close to nine per cent below the 10-year average in Fraser Valley. This, at a time when builders are pulling up stakes and shelving proposed developments due to softer demand. While the impact of those decisions will not be felt immediately, the decision to withdraw will have major repercussions on housing markets in these major centres down the road.

“Inventory remains a puzzle that policy can’t solve in the foreseeable short or long term,” says Alexander. “It’s a real challenge, as supply of detached homes remains low from a historical perspective and also in the context of population growth and future needs. This will remain a crucial factor impacting Toronto and Vancouver, which are now seen as world-class markets. Tougher market conditions and a possible recession will be major market hurdles, but history reminds us that recessions often bring strong rebounds. There’s always a reason buyers say, ‘I wish I’d bought back then.’ Real estate has traditionally stood the test of time. Looking ahead, urbanization alone will be a significant boon to future housing demand, as Canada’s urban population is projected to grow by 10 million by 2050.” (Source)

 

© 2022 RE/MAX All Rights Reserved.

Canada’s high court won’t hear dispute over $1B Vancouver waterfront development

The Canadian Press
The Vancouver Sun

The feud began in 2015 when Concord argued Singapore-based billionaire Oei Hong Leong and his company, Canadian Metropolitan Properties, backed out of a deal to jointly develop the former Expo 86 Plaza of Nations site.

The Supreme Court of Canada in Ottawa. Photo by Chris Helgren/Reuters

The Supreme Court of Canada has refused to hear an appeal from property developer Concord Pacific Acquisitions, ending a long-running legal dispute over the billion-dollar development of one of Vancouver’s last parcels of waterfront land.

The feud began in 2015 when Concord argued Singapore-based billionaire Oei Hong Leong and his company, Canadian Metropolitan Properties, backed out of a deal to jointly develop the former Expo 86 Plaza of Nations site.

Oei and Concord boss Terry Hui had signed an initial agreement to turn the parcel on the northeast shore of Vancouver’s False Creek into a mixed-use community, including 30 storey skyscrapers, an ice rink, community centre and arts venue.

When talks collapsed seven years ago, Hui and Concord launched a civil suit, arguing the preliminary agreement with Oei was a binding contract.

The B.C. Supreme Court sided with Oei in 2019 and the B.C. Court of Appeal issued its majority ruling in January, with both courts finding the contract lacked enough “essential terms” to make it enforceable.

The decision from the Supreme Court of Canada means the lower court rulings will stand and, as is customary, the high court does not give reasons for its refusal to hear Concord’s appeal.

Oei and Canadian Metropolitan Properties have pressed on with development plans for the Plaza of Nations lands, now called Expo Gardens, and the company confirmed the project has nearly completed the City of Vancouver’s permitting process.

Oei has said he hopes construction can begin this year on the property he bought in 1990 for $40 million but now has an estimated value of $800 million.

“Now I can build something iconic for Vancouver and give something back to this city I love,” Oei said in a statement released after the B.C. Court of Appeal decision.

Concord, which still owns the land east of the Plaza of Nations at the northeast end of False Creek, is in the process of seeking permits to develop that site.

The B.C. Appeal Court decision was “disappointing,” the company said when the ruling was released in January, but added in a news release that, regardless of the outcome of its Supreme Court of Canada appeal application, it hoped development of the Plaza of Nations site would “soon proceed in the interests of the community at large.”

© 2022 Vancouver Sun

Metro Vancouver housing starts down 28 per cent in July

Frank O’Brien
Western Investor

Sharp drop from a month earlier is in step with a downturn in housing sales

 Bucking a national trend, Metro Vancouver July housing starts fell 28 per cent compared to a month earlier, according to the latest data from Canada Mortgage and Housing Corp. (CMHC).

Meanwhile, Vancouver-area residential sales through the multiple listing service were down 22.8 per cent in July from June, reports the Real Estate Board of Greater Vancouver.

Early data shows the sales decline has continued into the first half of August.

Across Canada, the annual pace of housing starts in July edged higher compared with June despite a slowdown in urban starts, CMHC reported. The federal housing agency said Canada’s  seasonally adjusted annual rate of housing starts in July was 275,329 units, an increase of 1.1 per cent from the previous month.

In Metro Vancouver, which includes Surrey and Langley, annual housing starts fell to 23,318 units in July, down from more than 32,300 a month before.

Starts across B.C. were down 14 per cent, month over month, to 45,527 new homes, CMHC reported.  This is in sharp contrast to neighbouring Alberta, where starts were up 9 per cent to 41,195 units.

Compared to a year earlier, July housing starts in Metro Vancouver were down 6 per cent from July 2021 and 2 per cent lower for the province.

Sales and listings of existing housing have continued to cool in August across the Vancouver region.

“Vancouver is taking a break from real estate,” quipped Kevin Skipworth, managing partner with Dexter Associates Realty in Vancouver.

Skipworth said early data shows the downward trend in housing sales, which began in March, has extended into August, but that the supply of homes for sale is falling even faster.

At mid-month in August, there have been 1,813 new listings in Greater Vancouver, 39 per cent below the mid-month pace in July which was 2,958 at that point. A total of 884 homes had sold as of August 15 in Greater Vancouver, compared to 1,252 homes sold at mid-July, which itself was 29 per cent below the mid-month pace in June, according to early data from the Real Estate Board of Greater Vancouver.

“This will likely produce around 1,800 home sales for the month of August, which would be the least amount for that month since 1998,” Skipworth noted.

 

© 2022 Western Investor