Dan Fumano: Six-homes proposal latest in Vancouver’s housing ‘evolution’

Dan Fumano
The Vancouver Sun

Opinion: After controversially legalizing basement suites, laneway houses and then duplexes, Vancouver’s new six-units-on-one-lot proposal is the latest shift.

 A design by MA+HG Architects showing a four-unit front building beside older single-family residents. This plan also includes a two-unit laneway building. Photo by MA+HG Architects. /PNG

Sandy James remembers taking an informal poll of her city hall colleagues in the 1990s and learning every one who owned a house in Vancouver had a basement suite, or “mortgage helper.”

At the time, those suites were illegal.

It wasn’t until 2004 that Vancouver legalized secondary suites in single-family houses citywide. Such homes already formed an important part of Vancouver’s housing stock — the city estimated in late 2003 there were more than 20,000 illegal suites. But the debate around legalizing them, James recalls, was “extremely contentious.”

It might seem surprising or even bizarre to younger Vancouverites to imagine a heated debate around basement suites less than 20 years ago. But such is the nature of a city’s evolution. There has often been tension between how some people want to live, what some others want in their neighbourhoods, and what city halls allow.

James, who worked in Vancouver’s planning department from the 1980s until 2012, reflected on this history Thursday following council’s decision Wednesday night to explore a pilot project to allow up to six strata units on a single residential lot.

 

James is skeptical the policy will go far enough to have the desired effect. Many planners and development experts have expressed similar thoughts. City staff will now try to create the actual policies, and the details will, of course, be crucial. If the program eventually receives final approval, time will tell if these projects are actually viable.

But James called it “a good first step.”

Backers of this direction say Vancouver needs to add smaller, relatively more affordable homes in low-density neighbourhoods where secure rental housing is scarce and ownership is unattainable for all but the very wealthy, or those who bought in an earlier era.

“This is just evolution,” James said. “The city is dynamic. The way we use space is dynamic.”

 

Mayor Kennedy Stewart, who introduced the motion, called it “the single biggest shift in housing policy Vancouver has seen in a generation.”

Every generation has had its own debates.

In the fierce opposition to legalizing basement suites, James recalls, “parking was always the big thing.”

In Vancouver and elsewhere, parking is one of the issues raised most frequently in opposition to new development or proposals to explore different kinds of housing.

Addressing council on Wednesday night, Elizabeth Murphy of the Vancouver Character House Network said: “This motion raises more questions than answers. What about parking?”

The proposal, which directs staff to develop policies to target up to 2,000 lots currently zoned for houses or duplexes to be redeveloped for up to six stratified units, would have “a major effect on neighbourhood character,” said Murphy, who is also the vice-president of TEAM for a Livable Vancouver, a new political party.

 

In 2018, Murphy was a prominent opponent of the direction under Vancouver’s previous Vision-majority council to allow duplexes in almost all the low-density areas previously called “single-family neighbourhoods.”

In 2009, Vancouver gave the green light to laneway houses, and faced similar backlash.

There was a time when much of Vancouver hated the housing type that now bears its name, recalls civic historian John Atkin.

So-called “Vancouver specials” started popping up by the thousands in the mid-1960s. These houses often had two kitchens, one upstairs and one down, and were therefore “an incredibly efficient house form” that was widely popular, particularly with multi-generational immigrant families, Atkin said. But a backlash to the Vancouver special had formed by the 1980s.

 

In 1987, then-councillor Carole Taylor introduced a motion to ban second kitchens in new homes, as “the first step toward ensuring that single-family neighbourhoods survive in at least some parts of Vancouver, and stopping the ‘exponential growth’ of illegal suites,” The Vancouver Sun reported at the time.

At that 1987 public hearing, then-councillor Libby Davies “drew howls of outrage, as well as some applause, when she said she found an ‘element of racism’ in the debate,” Sun reporter Carol Volkart wrote.

“I find it very disturbing that every speaker from the Indo-Canadian community who got up here and spoke tonight was booed or hissed,” Davies said at the meeting. “Some of the comments that were made about ‘they’ and ‘their big families’ — I think you have to understand that Vancouver neighbourhoods have changed with new Canadians who have come to live in Vancouver and there are cultural differences.”

 

Council voted 9-2 to eliminate second kitchens.

Peter Whitelaw, a senior planner with Simon Fraser University’s Renewable Cities program, spoke in favour of the latest direction on Wednesday evening. Whitelaw said Vancouver’s leadership needs to reckon with the fact the population density of many low-density areas — once called the “single-family neighbourhoods” — has actually dropped since the 1970s.

During that time, most of Vancouver’s population growth happened in a relatively small chunk of its land, such as the downtown peninsula, the Broadway corridor, and a few other hubs.

Much of the city’s residential land, especially in its southern half, haven’t experienced much physical change in the past few decades.

“But change is always happening, whether we see it or not,” Whitelaw said Thursday. “The loss of population, we don’t really see it, but that happened. And eventually you get these empty, unaffordable neighbourhoods.”

The motion directs staff to report to council in 2022 with recommendations on next steps. Considering council is scheduled to break in July before the October election, it seems likely final decisions will be made by whoever sits on Vancouver’s next council.

Whenever that happens, expect debates about parking.

 

© 2022 Vancouver Sun

Toronto closing on Vancouver as Canadas priciest real estate market

Joel Schlesinger
The Vancouver Sun

 Vancouver has had more listings recently than Toronto, helping to narrow the price gap between the two cities. Photo by Darryl Dick /The Canadian Press

Vancouver has a challenger in the title for Canada’s most expensive real estate market — Toronto — a new report finds.

TD Economics published a report on price movements in the nation’s two largest cities, finding the gap between pricing is today the smallest since 1991.

In December, average prices in Greater Toronto Area were about four per cent less than the Greater Vancouver Area, the report notes (though it did not provide a precise average price for either city).

Yet Canadian Real Estate Association data as of Dec. 31 suggested an even tighter spread between these markets with benchmark home price in the GTA at $1,208,000, compared with the GVA at $1,230,200. That is less than a two per cent difference in price.

The TD report attributes the tightening price gap to the 15 per cent foreign buying tax in the GVA in place since 2016. Additionally, higher land transfer and school taxes on expensive homes in the Vancouver region further dampened growth.

Prices in the GVA still rose about 13 per cent since 2018, but the GTA saw an increase of 40 per cent over the same span. Another factor has been supply, which was not as tight in the Lower Mainland in 2021. There, new listings grew by about 16 per cent compared with the Toronto region, which only saw listings grow by about six per cent.

Another tailwind for GTA’s price growth has been investor demand, making up about 24 per cent of buyers compared with the Vancouver region at about 21 per cent.

The report notes the price gap will likely narrow more in 2022, but investor demand could be “a wildcard” and may swing back with more investors favouring the Vancouver area.

 

© 2022 Vancouver Sun

Canada housing crash how likely is it

Fergal McAlinden
other

Mortgage debt in Canada is skyrocketing. How much is too much risk for Canadian borrowers?

 Total residential mortgage debt in Canada mushroomed to $1.77 trillion in 2021’s third quarter as the country’s housing surge showed no sign of letting up.

The ongoing COVID-19 pandemic has acted like rocket fuel for what was already a turbocharged housing market, with low interest rates, increased savings and a yearning for more space compelling many Canadians to make their move.

With no sign that house prices across the country are ready to halt their rapid upward climb, the question remains: Could homebuyers across the country be taking on more debt than they can handle?

According to a Canada Mortgage and Housing Corporation (CMHC) senior analyst, risk is increasing in the mortgage market – but there’s still little reason for undue concern thanks to emerging positive signs in borrowing trends. 

 

Seamus Benwell (pictured top right), who co-authored the body’s recently released Residential Mortgage Industry Dashboard alongside senior specialist, housing research Tania Bourassa-Ochoa, told Canadian Mortgage Professional that while mortgage debt was indeed continuing to rise, arrears were registering a decline at the same time.

“We see mortgage debt growth continuing to increase – it’s gone up about 11% year over year. We’re also seeing that total debt service [TDS] ratios of over 40% are increasing quite a bit in the market – especially since the second half of 2020,” he said.

Read next: Will declining consumer confidence impact the mortgage market?

“Those two suggest that there is higher risk in the mortgage market. However, the good news story is that we see mortgage arrears for all mortgage lender types going down – so despite mortgage deferrals and other pandemic-related aid programs coming to an end, borrowers are still able to make mortgage payments or take advantage of housing market conditions to sell their property rapidly to avoid default.”

That CMHC report showed that more than a quarter of uninsured mortgages in Canada now have a TDS ratio over 40%, with the percentage of uninsured new mortgages with a TDS of 40% or less further decreasing in 2021 after posting a decline the previous year.

Benwell said that while that trend isn’t an immediate cause for worry, it could develop into a bigger problem if the number of highly leveraged mortgage customers keeps growing.

“It hasn’t reached astronomical levels, but it’s definitely increasing,” he said. “If that trend continues, I think there is cause for concern.”

With markets currently pricing in a number of interest rate increases from the Bank of Canada this year, the possible impact on Canadians’ household finances has been noted.

An Angus Reid Institute survey at the beginning of January found that “any rise in rates threatens the financial situations of Canadians sitting on debts and loans – especially mortgages,” with 53% of respondents saying an interest rate hike of 2% would negatively impact their household finances.

Benwell said that Canadians with variable rate mortgages were likely to see some negative effects from those rate hikes – although the fact remained that a large number of mortgage holders are tied to a fixed rate.

Read next: Rate hikes, inflation to weigh heavily on household finances – poll

“We know that as soon as rates start to increase, we can expect borrowers with a variable rate mortgage to be paying higher monthly payments and [that’s] absolutely something we’re going to be keeping an eye on if those higher rates do arrive,” he said.

“The other side is that most Canadians are still on a fixed rate, so that does give us a bit of a transition period where the higher rates don’t affect all mortgage borrowers.”

Much will depend on the nature of Canada’s emergence from the pandemic, with many housing market trends – the so-called “exodus” away from urban centres and increased household savings leading to higher purchasing power, for instance – brought about by the realities of COVID-19.

If a significant rise in interest rates is accompanied by an end to all government support for workers whose employment has been affected by the pandemic, that could also have stark consequences for mortgage borrowing in the coming months.

“We can certainly expect that to affect the mortgage market again. What we’ve seen today is that borrowers are able to make their payments, so that’s the good news,” Benwell said. “As interest rates rise and other supports are removed, I wouldn’t be surprised to see some borrowers end up in stress – but how many remains to be seen.”

 

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Local landlords swallowed as market demands deeper pockets

Frank O’Brien
Western Investor

Six out of 10 rental apartment buildings in B.C. now bought by national REITs or other institutional investors as soaring prices, government restrictions convince local landlords to sell

 There is a changing of the guard amidst the churn in B.C.’s multi-family rental market which saw a record-shattering $3 billion in apartment building sales last year in Metro Vancouver and Greater Victoria.

Despite what appears the strongest rental market in Canada – with the highest average rents, the lowest vacancies and a consistent lack of supply – local landlords who have dominated the market for decades are selling, according to a new report from CBRE Vancouver, the leading multi-family broker in the province.

After a near year-long rent and eviction freeze and a capping of B.C. rent increases at 1.5 per cent for 2022, despite an official inflation rate at a 30-year high, many veteran owners are cashing out.

“B.C. government-imposed policies and rent freezes, escalating operating costs and potential increases in capital gains tax nudged more owners to make the decision to sell and take advantage of the market demand and record pricing,” said Lance Coulson, executive vice-president of CBRE national apartment group, in releasing the 2021 Annual Apartment Report for Metro Vancouver & Greater Victoria.

As of the end of last year, the average price per door of a Metro Vancouver rental apartment building hit an all-time high of $456,415 and had spiked to $530,980 in Vancouver’s West End and to $671,701 on the North Shore.

In Greater Victoria, prices per suite are $308,705, but are lower, at an average $260,758, in the City of Victoria, which accounted for more than half of the 48 apartment building sales in the capital region in 2021.

Vancouver has the highest average rent in Canada, with a one-bedroom apartment at $2,176 and the average monthly rent for a two-bedroom at $2,983, according to the December 2021 National Rental Report from Bullpen Research & Consulting. 

Victoria’s average rent for a one-bedroom home is $1,566 and average monthly rent for a two-bedroom is $2,453, third highest in the country, the report found.

Last year, 185 apartment buildings sold in Metro Vancouver and Greater Victoria for a total of $3 billion, up from $1.2 billion in 2020. Major institutional investors and real estate investment trusts accounted for 60 per cent of the 185 transactions. These big buyers are often seeking scale with the purchase of existing portfolios, according to CBRE.

An example is the 15-property, 614-unit Legacy portfolio in Vancouver that CBRE sold for $292.5 million in February 2021. The seller was Hollyburn Properties of Vancouver, which had owned most of the buildings for decades. The buyers were InterRent REIT of Ottawa and Toronto-based Crestpoint REIT.

While some tenants mourn the passing of local landlords, well-financed institutional owners can offer advantages to tenants, according to Coulson, who noted that the deeper pockets allow regular maintenance and upgrades in a region where the typical apartment building is 54 years old. Larger landlords with multiple properties are also better equipped to ride out rental income and renovation restrictions under B.C.’s Residential Tenancy Act. 

CBRE also noted that, despite rising immigration and political rhetoric, construction of new rental apartments is lagging population growth.

In 2021, only 6,269 new rental apartments were completed in Metro Vancouver, for example, despite an expected influx of 35,000 people moving into the region on average each year.

“The policy-based barriers restricting the development of new rental housing will continue putting demand on the rental market [and] continue to put downward pressure on vacancy rates and upward pressure on rents,” CBRE’s report concludes.

 

© 2022 Western Investor

New low-barrier REIT already owns Metro Vancouver land

Frank O’Brien
Western Investor

 For as little as $5,000, investors can share in projects backed by a veteran local developer holding 560 acres at 19 separate sites

For as little as $5,000, investors can share in projects backed by a veteran local developer holding 560 acres at 19 separate sites

Surrey-based Isle of Mann (IOM) Property Group launched a unique new real estate investment trust on Jan. 12, 2021.

Within 48 hours its PROPetual Real Estate Investment Trust (PROPREIT) had raised $750,000 linked to a 10-acre residential and retail development in South Surrey that will deliver 406 housing units and 30,000 square feet of commercial space.

Ravi Mann, president of PROPREIT, expects the entire offering to be quickly subscribed in a new investment format that, he says, has turned the REIT concept on its head.

“Historically, developers would present these opportunities exclusively to institutional or high-net-worth investors, with minimum investment in the hundreds of thousands of dollars, namely due to the high capital requirement and long-term nature of developing real estate projects,” Mann explained.

Instead, PROPREIT has established a low minimum investment starting at $5,000 in property developments that are already in process, most at final reading at city councils.

“We saw a gap in the market that required some innovation,” Mann said.

As an executive with the family-owned IOM Property Group, which began in 1994 and has developed dozens of residential and commercial projects across the Lower Mainland, Mann said a barrier for investors is the length of time it takes to get a project started and built.

“Ten years ago, a year was considered a long process.  These days you are lucky, very lucky, to get a big project through the pipeline in three years,” he said.

“We realized we had to relook at the whole model of how people invest in real estate.”

As a result, PROPREIT was established to provide investors with access to IOM’s steady pipeline of qualified, high-profile real estate development projects, which Mann said removed barriers to entry for retail and accredited investors alike.

“With the scarcity and difficulty of land development opportunities in Metro Vancouver, our vision was to provide an investment vehicle that afforded the same opportunities to anyone who is ready, willing, and able to invest in real estate,” Ravi said. “By leveraging the IOM pipeline of qualified land development, we believe PROPetual REIT will achieve this vision.”

The PROPREIT is eligible for registered savings programs, he added, such as RRSPs.

IOM has been buying raw land across Metro Vancouver for decades. It currently owns 19 development sites covering 560 acres, primarily in Surrey and Langley. According to Mann, who is also IOM’s director of finance and investment, the land is valued at $364.5 million.

IOM Property also owns 3,500 acres in Alberta’s Calgary region, but the original emphasis for PROPREIT is Metro Vancouver, Mann said.

Beyond the local land link, PROPREIT is different from most real estate investment trusts. It is private offering, not a public REIT listed on any stock exchange. And, unlike most REITs that rely on long-term lease income, PROPREIT acts more like a real estate limited liability partnership (LLP), with a share of profits and an exit strategy.

“The sole intention of this REIT is to sell everything it constructs,” Mann said. “This REIT is not retaining any income-producing properties,” he said, adding that IOM is planning an income REIT for the future.

Mann said the initial project, the 10-acre Sunnyside mixed-use development along busy 24th Street in South Surrey, is an example of how the REIT could pay off for investors.

The development involves 100 townhomes, 200 condominium apartments, more than 100 market rentals and 30,000 square feet of office and retail space.

Mann expects to get third reading and final approval on the project from Surrey Council in the first quarter of 2021. Last year, Surrey became the first B.C. municipality to guarantee timelines for development.

Mann estimates the the phased project will take five years to total build out. He said the strata townhomes and condos would be sold, while the residential rental buildings and commercial buildings would be packaged and sold as separate parcels, perhaps to an income-REIT.

Investors will receive a preferred 8 per cent per annum return based on how long they have participated and are paid before PROPREIT collects any management fees. PROPREIT then charges a sliding scale of fees based on the total returns, starting at 25 per cent for annual returns of 12 per cent. “If we knock it out of the park and each investor makes more than a 20 per cent annual profit, we’d collect 55 per cent.”

In typical real estate LLP offerings, investors are offered a preferred annual return of 8 per cent plus a 50-50 split on any profits above that.

“Whether you are investing $5,000 or $500,000, we treat everyone the same. We want the average citizen to become part of real estate opportunities, rather than just a passive observer,” Mann said.

 

© 2022 Western Investor

REPORT: Where Are The Most Affordable Places To Buy In The GTA? (By Product Type)

Rachel Rehkopf
other

Would you move further out of the city to secure the type of home you’re looking for within budget?

Given how popular work from home has been in the last few years, the option to choose home type first and city second is opening up to more buyers in Southern Ontario.

In fact, a Zoocasa survey early last year found that the pandemic has led to 32% of Ontario buyers purchasing a property in a location further than what they would have previously considered – and given the consistent price increases recorded across the province throughout 2021, it’s safe to say that trend has continued.

Buyers who have their eye on a certain type of home, whether that’s a condo in the city centre or a townhome with a yard for their dog, can save big if they can be flexible on which city in the Toronto Region they’d like to make their purchase in.

To help prospective buyers narrow down which areas they should consider focusing their house search in, Zoocasa has ranked the top five most affordable cities within the bounds of the Toronto Regional Real Estate Board to buy a detached home, semi, condo townhouse, and condo apartment based on November 2021 sales data*. 

In other words, if finding the right type of home at the right price point is more important to you than buying in any particular city, this report is designed to help you discover which cities to consider in your home search.

Brock is the most affordable place to purchase a detached home 

 

Although the average price for a detached home in the Toronto Region hit $1,567,832 near the end of last year the top five most affordable cities to buy a detached home in the greater region all clock in with an average price under a million dollars – a significant savings of more than $500,000.

Brock, the most affordable city on the list, is a small town in the north end of Durham township. As of 2016, the population reached just over 11,000 – making it a great choice for buyers looking for more space and a small-town lifestyle.

With an average price of $774,500, detached homes here are half the price of the region’s average. However, affordability comes with a proximity tradeoff. Brock is located in the Toronto Region’s farthest north reaches, and nearly borders Lake Simcoe. In good traffic conditions, you can reach Union Station by car in a little over an hour and a quarter, but Barrie and Peterborough are both closer cities – meaning you likely won’t want to commit to a daily, downtown Toronto commute if you’re living here.

If you’re looking to live a little closer to Toronto’s core, Oshawa and Orangeville both offer better connectivity to the rest of the GTA, with detached homes still coming in at an average price of less than a million. If you’re looking for small-town living, Essa (near Barrie) and Scugog (near Port Perry) are other options on the list that round out our top 5 most affordable places to buy a detached home in the Region. 

Source: TRREB November 2021

Orangeville is the Most Affordable Place to Buy a Semi-Detached Home

If you’re looking for the spaciousness of a detached home, with a smaller price tag, a semi-detached home can be a great option. When looking at the most affordable places to buy in the GTA, Orangeville tops the list for semis, with the average coming in at $715,000, almost half a million dollars cheaper than TRREB’s average for that same category. 

Although like many of the more affordable places to buy, Orangeville is a smaller community on the outskirts of the Region’s reaches. still a city in its own right with a population of nearly 30,000.

When it comes to commuting, under the right traffic conditions you can make it to Union Station by car in less than an hour. If your company is headquartered in Mississauga, Brampton, or Milton you’ll find yourself well within commuting distance, especially if you’re working in a hybrid arrangement. 

Durham is another region to consider if you have your eye on a semi. Average prices in the cities of Oshawa and Clarington were $761,002 and $818,583 respectively. Next on the list is Simcoe’s New Tecumseth with an average price of $820,167, with Halton Hills rounding out the top five with an average price of $905,500.

Source: TRREB November 2021

Orangeville is Also the Most Affordable Place to Buy a Condo Townhouse

If things like multiple floors of living space and  access to private outdoor space are high on your wishlist,  a condo townhouse might be an affordable option for you to consider. Combining the higher-density building form and ownership structure of a condo, these homes are a great blend of space and affordability, especially for young families.

Regardless of your desired city, the average price in the Toronto Region is $826,475 for a condo townhome, which is well below the average price of all home types. When looking for the most affordable cities to choose from, Orangeville comes out on top again with an average price of $570,625 for this type of home.
The rest of our more affordable options come from Durham Region, with the cities of Oshawa, Whitby, Clarington, and Pickering rounding out the remaining spots on the list.

Source: TRREB November 2021

Oshawa is the Most Affordable Place to Buy a Condo Apartment

 Condo apartments are one of the most affordable home types on the market in the Toronto Region today, with the average price as of November hitting $711,933 – a rate that comes in at over half the cost of the average detached home.

Within this category, you can find options with average prices under $400,000 if you consider moving to Oshawa, where the average price for a condo apartment was just $381,795 near the end of 2021.

Compared to some of the other cities that topped our list of affordability, Oshawa is considerably larger and more connected. With a population of 170,071 you’ll find more big-city amenities than what’s offered in Orangeville and Brock.

When it comes to your commute, you can make it downtown in 45 minutes by car in good traffic conditions, and taking public transit to work is a viable option with frequent GO Train service. 

Other cities that top the list for the most affordable places to buy a condo apartment in the Toronto Region include Orangeville, New Tecumseth, Brampton, and Newmarket 

What Do Buyers Need To Know About Moving Further Away From The City Centre? 

According to Zoocasa Sales Representative, Allyson Neves, many of today’s buyers understand that being flexible on the location of their home purchase can help them check more boxes off of their wishlist

“Lately when I’m working with buyers, they’re coming to me with their top budget and wishlist for their home then asking me where they’ll need to move to marry the two. It becomes my job to help introduce them to new neighbourhoods or smaller towns that they may not have considered previously” she explains. 

When working with buyers with this mindset, Neves starts the process off by understanding the non-negotiables. “It really comes down to knowing your price point first, along with anything else that binds you to a certain general location.”

“Usually buyers will come to me with a general bound for their location. This used to commonly be ‘no more than an hour from the office’. However, with work from home or hybrid options becoming the norm in many industries, I’m more often hearing ‘no more than an hour from my family’, or ‘I’d like to stay north of Toronto’. I compare this request with their budget and talk about which areas would be a fit for what they’re looking for in a property. From there, we start our house hunt. If you’re a buyer with this mindset, it’s helpful to work with an agent who really knows the general area you’d like to purchase in, they’ll be able to introduce you to some of the best places to consider during your search.” 

While this report focused on the most affordable locations to purchase in the GTA outside of the city centre, this same mindset can still be applied for buyers looking outside of Toronto too. Neves, who is based out of Barrie explains, “as an agent that specializes outside of the GTA, it’s been a real pleasure introducing buyers who are new to the area to all that outside-of-Toronto living has to offer. Many are excited to trade city living for more space.”

Considering Buying a Home This Spring?

Find Out Where You Should Start Your Search–
Methodology:

*Since in many smaller cities inventory for condo-style homes is lower, November 2021 numbers were used over December 2021 since overall sales volumes were higher – allowing a larger sample size for these smaller cities. To avoid small sample sizes distorting the results, only cities with more than three sales in each respective product category were included in the analysis. 

© 2015 – 2021 Zoocasa Realty Inc., Brokerage

 

 

 

GTA sees second-best year for new home sales in 2021

Michelle McNally
Livabl

The Greater Toronto Area had its second-best year in history for new homes sales in 2021, capping things off with the lowest count of home inventory ever recorded.

New data from the Building Industry and Land Development Association (BILD) released today shows that new home inventory in the GTA dipped to the fewest properties on record December 2021.

Normally, the month of December sees few project launches. With that, total new home remaining inventory dropped to 8,922 units last month, about 2.3 months worth of supply based on average sales for the past 12 months. Since this dataset started to be recorded in January 2000, this is the lowest level yet. Typically, a balanced market should have nine to 12 months of inventory, BILD explained.

Remaining inventory includes units within pre-construction projects, projects that are currently under construction and those in completed buildings.

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In December 2021 alone, 2,739 new homes were sold. Condo apartments — which includes units in low, medium and high-rise buildings, stacked townhouses and loft units — contributed 2,170 sales to this total, marking the second-highest December for condo sales behind 2016.

The cost of a new single-family home shot up 38.5 per cent over the past 12 months to an average of $1,829,693. New condo apartment prices reported almost a third of that growth, rising 13.5 per cent year-over-year in December to $1,163,924.

“The record low inventory levels and record high benchmark pricing we saw in December illustrate perfectly why housing supply and affordability will rank among the defining issues in this year’s provincial and municipal elections,” said Justin Sherwood, BILD’s senior vice president of communications and stakeholder relations, in a press release.

“Insufficient housing supply is driving the GTA’s housing affordability challenge while exacerbating inequality, slowing down economic growth and threatening our collective quality of life. Voters will demand meaningful platforms and policy ideas from candidates and parties,” he added.

Overall, the GTA new home market had “extremely robust levels of new home sales,” in 2021, marking the second-highest year on record after 2002. In total, 46,651 new homes were sold across the region, 27 per cent above the 10-year average.

Condo apartment sales were strong in 2021, raking in 32,919 units sold last year. This misses the 2017 all-time record by just 125 units, and is 40 per cent above the 10-year average for the GTA.

Single-family homes — including detached, linked, and semi-detached houses and townhouses, but excluding stacked townhouses — accounted for the remaining portion of sales, with 13,732 properties sold in 2021. This was four per cent above the 10-year average.

Altus Group, BILD’s official source of new home market intelligence, provided the data used in the market report.

© 2020 BuzzBuzzHome Corp.

Douglas Todd: Trudeaus housing promises still not materializing

Douglas Todd
The Vancouver Sun

Opinion: It’s imperative to monitor how little the prime minister has done to rein in prices that have soared 85 per cent since the Liberals were first elected in 2015.

Few things reveal Justin Trudeau’s unwillingness to seriously follow through on his housing rhetoric than his approach to foreign buyers. (Photo: PM visits housing complex in Ontario on July 20, 2021.) Photo by Cole Burston /The Canadian Press

It’s easy to lose track of Prime Minister Justin Trudeau’s broken promises on the housing crisis.

 

But it’s imperative to monitor how little he has done to rein in prices that have soared by 85 per cent since his Liberal government was first elected in 2015.

Few things reveal Trudeau’s unwillingness to seriously follow through on his housing rhetoric than his approach to foreign buyers, who most analysts agree have been one of the significant factors jacking up prices.

We can go back more than two years, to the fall election campaign of 2019, when Trudeau strategically came to B.C., where the unaffordability crisis had been brewing for years, to announce a tax on homes owned by foreign buyers.

Yet, when the Liberals won a minority government in October of that year, Trudeau managed to make the foreign-owners tax promise disappear from the public’s mind — despite the Conservatives and the NDP making it clear they would support it.

Then, in last fall’s election campaign, Trudeau again trotted out the same commitment, vowing a one-per-cent tax on under-utilized homes owned by non-resident, non-Canadians.

And when the Conservatives’ Erin O’Toole upped the housing-crisis ante by promising to ban foreign buyers for two years, Trudeau blatantly copied him. He also claimed he would put a tax on property flipping, spend billions on housing supply, and restrict exploitive real-estate agents.

Journalists, as a result, began talking about Trudeau’s “aggressive” new approach to the housing calamity.

But what, actually, has happened? There are, for instance, no signs his dramatic-sounding two-year ban on foreign buyers is about to become legislation any time soon.

And even Trudeau’s mild old promise — a one-per-cent tax on foreign-owned vacant homes, effective Jan. 1, 2022 — is far from reality.

The Liberal government is “diddle-daddling” on the housing disaster, says Brad Vis, MP for Mission-Matsqui-Fraser Canyon, and recent housing shadow minister for the Conservatives.

Last June, Vis introduced an opposition-day motion in the House to freeze housing purchases by non-resident foreign buyers. It was passed with the support of Conservative, NDP and Bloc MPs, but opposed by Liberals.

Still, the public would be forgiven for thinking that Trudeau’s meek campaign promise to tax foreign nationals’ under-utilized homes would be running by the beginning of this year, since that’s when it was supposed to go into effect. But, with the Liberals largely avoiding parliament last year, it took until mid-December to even become a legislative proposal.

 

 

It is important to make sure it’s “not easier for foreign buyers, who often possess a taxation advantage over Canadians, to use that advantage to outbid Canadians in the housing market,” says Conservative MP Brad Vis, the party’s shadow minister on the B.C. economy. Photo by Christian Diotte /Christian Diotte, HOC-CDC, 2021

The Liberals have “only tabled the (tax) legislation in an omnibus bill that hasn’t been debated in parliament,” said Vis. “So we could have months of debate and committee study and then have to go through the Senate as well. We’re months away from any kind of foreign-buyers tax.”

A multi-pronged response to the housing tragedy is necessary, Vis said, because Canadians, and young British Columbians in particular, “are having a harder and harder time, even on a six-figure salary, to even consider owning a home. For many, it’s impossible.”

In addition to tackling the ways housing supply, low interest rates and immigration levels impact housing costs, Vis said it is important to make sure it’s “not easier for foreign buyers, who often possess a taxation advantage over Canadians, to use that advantage to outbid Canadians in the housing market.”

Vis is far from alone in his thinking. Even the Liberals’ former secretary of housing, Adam Vaughan, admitted as much last year when he said Canada has become “a very safe market for foreign investment  … but it’s not a great market for Canadians looking for choices around housing.”

With national home prices rising another 26 per cent year-over-year in December, Vis charges Trudeau with “negligence.”

Even the Liberals’ potential bill to tax non-foreign owners reveals significant loopholes. Were it to go ahead, the party wants to exempt non-Canadians who buy what it calls “recreational properties,” including one a family member lives in for just four weeks a year.

Whatever comes of the bill, dubbed C8, it is also a far cry from a two-year ban on all foreign buyers. And it doesn’t come close to Singapore’s recent decision to slap a 30-per-cent surtax on all foreign purchases , as well as a five-per-cent tax on first buys by permanent residents.

The modest bill also would not match the foreign-buyers’ taxes B.C. and Ontario already have in place to cover urban centres. And it doesn’t touch one of the many problems related to foreign capital (as distinct from foreign buyers) that B.C. has tried to address with its 2018 speculation and vacancy tax, which in part targets “satellite families” who earn more than half their income offshore.

Citing the work of former SFU prof. Josh Gordon , Vis recognizes many immigrants, especially professionals, who buy houses in Canada are doing so with equity from their homelands. “I don’t blame them for that,” he said, “but for Canadian citizens, it’s another stoke in the fire” of unaffordability.

To be clear, it is not only Trudeau who has been painfully lacklustre on housing. As UBC prof. Paul Kershaw, founder of Generation Squeeze, said Wednesday, Canadians are now hearing a lot about our inflation woes.

“But it’s surprising that this story is only just taking centre stage when rampant inflation to the largest expense faced by all Canadians — housing — has been the norm for the last 20 years.” Since 2000, he said, average home prices have risen by a “whopping 318 per cent.”

Still, Trudeau, now in his seventh year in power, took until last September’s election to construct his apparent wall of housing pledges. And, unlike the possible tax on non-resident owners, his other verbal commitments are not yet even possible bills.

When Postmedia asked Housing Minister Ahmed Hussen this week about the party’s vows, his media official responded with what has to be called more verbiage, saying the minister recognizes “the dream of home ownership has become out of reach for far too many Canadians.” Hussen was doing all he could to “consult” and “work with every tool” to bring about affordability. No legislative deadlines were offered.

Nevertheless, despite what often seems a Liberal haze of smoke and mirrors, the party keeps winning minority governments by snagging one-third of the popular vote, in part on the strength of Trudeau’s so-far hollow housing promises.

His election machine capped off the September vote by grabbing all but a handful of the 79 ridings in Greater Toronto and Metro Vancouver, where housing costs have long been the worst, not only in Canada, but in much of the world.

Go figure.

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© 2022 Vancouver Sun

TD announces major hiring spree

Kevin Orland
other

2,000 are set to come onboard in tussle for talent

 Toronto-Dominion Bank plans to hire more than 2,000 technology workers this year, more than six times the number added last year, pitting the lender against fintech firms in the war for talent.

The hires come as the bank works to become more digitally focused, according to a statement Wednesday, and follow the 300-plus technology roles added in 2021. Toronto-Dominion declined to say how much it’s planning to spend on the hires.

The pandemic accelerated efforts by the Toronto-based company to shift to an operating model that’s more tech-centric so innovations can be quickly introduced to staff and customers, said Greg Keeley, senior executive vice president for platforms and technology.

That’s increased the need for workers skilled in cloud-computing, artificial intelligence and agile project-management — and has put the bank in competition with tech giants, start-ups and fintechs for that talent, he said.

“We’ve recognized that, as the market evolves, as the expectations of our customers evolve, our capabilities need to evolve as well,” Keeley said in an interview.

The bank, which has operations across Canada and along the US East Coast, is looking to add the workers throughout its geographic footprint, he said. The bank has partnerships with universities and organizations such as the Ontario Network of Women in Engineering and the Black Professionals in Tech Network to help with recruitment and ensure diversity in hiring, he said.

Toronto-Dominion also is working to train its current workers on the needed skills, and sees that emphasis on developing existing talent as part of its allure to recruits, Keeley said. He estimates that talent takes up about 30% of his time, and expects his division’s leaders to allocate the same amount of their time to the effort as well.

“It’s a war on talent, but we think we have a differentiating model,” Keeley said. “We’re not going after just the traditional players, we’re going after the modern talent too.”

The bank said in a separate statement that it’s starting a new Equity, Diversity & Inclusion platform to ensure different perspectives and experiences are reflected in the development of its products and services.

 

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Bank of Canada makes benchmark rate announcement

Fergal McAlinden
other

All eyes have been on the Bank in recent weeks amid speculation of an impending rate increase

 The Bank of Canada has once again stayed the course on its benchmark policy rate, announcing no change to that key rate in its first announcement of the year – but acknowledging that interest rates “will need to increase.”

The central bank said that it was keeping its policy rate steady at 0.25%, belying some economists’ predictions of a January rate hike, but also indicated that it would soon end its commitment to hold its policy rate at the effective lower bound.

While consumer price inflation (CPI) reached its highest level in Canada since 1991 last month, the announcement signals that the Bank is also keeping a watchful eye on the Omicron variant of COVID-19 sweeping the country.

December’s annual inflation of 4.8% represented a 30-year high, according to figures released by Statistics Canada, but the country’s economy also continues to be significantly affected by business closures and other restrictions because of Omicron.

Read next: When will the Bank of Canada raise interest rates?

Still, the Bank sounded a relatively positive note on the Omicron front, saying that it expected it to have milder economic downsides than previous waves of COVID-19.

“The Omicron variant is weighing on activity in the first quarter,” the Bank said in its announcement. “While its economic impact will depend on how quickly this wave passes, it is expected to be less severe than previous waves.

“Economic growth is then expected to bounce back and remain robust over the projection horizon, led by consumer spending on services, and supported by strength in exports and business investment.”

The Bank addressed inflation concerns in its statement, noting that core measures had edged up since October and CPI inflation was “well above” its target range – but also indicating that it expected inflation to “decline reasonably quickly” to about 3% by the end of the year.

“Near-term inflation expectations have moved up, but longer-run expectations remain anchored on the 2% target,” it said. “The Bank will use its monetary policy tools to ensure that higher near-term inflation expectations do not become embedded in ongoing inflation.”

Some economists had expected the inflation issue to push the Bank into hiking its benchmark rate in today’s statement, marking the first of several rate increases over the course of the year.

Read next: Rate hikes, inflation to weigh heavily on household finances – poll

Silvana Dimino, a New York-based economist at J.P. Morgan, said in a note to clients this month that as many as five rate hikes were possible in 2022, with those moves set to push the benchmark rate to 1.5% by the end of the year.

That view was bolstered by employment statistics that saw 54,700 new jobs added to the national economy in December, according to Statistics Canada, far surpassing experts’ predictions of a 25,000 increase that month.

However, Canadian Imperial Bank of Commerce (CIBC) deputy chief economist Benjamin Tal highlighted the dilemma facing the Bank in an interview with BNN Bloomberg, noting that it was caught between pandemic concerns and the wishes of the business community.

“We are in the middle of the winter. Omicron is still with us. It will be with us throughout the winter. So if you’re the Bank of Canada, do you want to start raising interest rates in the middle of this madness?” he said. “At the same time, the business community is telling you to start moving.”

The Bank of Canada’s next announcement on its policy interest rate is scheduled to take place on March 02, with its next full outlook for the economy and inflation pencilled in for April 13.

 

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