Tag Archives: 2018

GTA Condos

GTA condos lead resale price growth in 2018

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GTA condos lead resale price growth in 2018

GTA Condos

Multi-family homes – namely townhomes and condos – led the way in price growth among resale homes in the GTA in 2018, according to the latest statistics from the Toronto Real Estate Board (TREB).

Overall, the average selling price for the year was $787,300, down 4.3 per cent, while sales declined 16.1 per cent from 2017.

Home prices were up slightly in the city of Toronto and down in the surrounding GTA regions. This dichotomy reflects the fact that the condominium segment, which accounted for a large proportion of sales, performed better from a pricing perspective than detached homes. The average price for condominium sales across the TREB market area was up by 7.8 per cent year-over-year.

Higher borrowing costs

“Higher borrowing costs coupled with the new mortgage stress test certainly prompted some households to temporarily move to the sidelines to reassess their housing options,” says Garry Bhaura, TREB president. “It is important to note that market conditions were improved in the second half of the year, both from a sales and pricing standpoint.”

“After spiking in 2017, new listings receded markedly in 2018,” adds Jason Mercer, TREB’s director of Market Analysis and Service Channels. “In many neighbourhoods, despite fewer sales from a historic perspective, some buyers still struggled to find a home meeting their needs.  The result was a resumption of a moderate year-over-year pace of home price growth in the second half of the year.  Price growth was strongest for less-expensive home types, as many home buyers sought more affordable home ownership options.”

Outlook Report

TREB will be releasing its fourth annual Market Year-in-Review and Outlook Report on Feb 6, featuring the latest results from the Ipsos surveys of existing homeowners and intending homebuyers.  The report will also contain information on the new home market and other analyses.

 

GTA average prices by home type, yr/yr % change

Condominiums
416:
$594,381, 11.4%
905:
$454,135, 5.8%
Total:
$554,497, 9.9%

Townhomes
416
: $714,456, 10%
905: $591,851, 2.9%
Total: $624,042, 5.3%

Semi-detached
416
: $939,859, 4%
905: $661, 186, 3.9%
Total: $755,707, 3.2%

Detached
416
: $1.14 million, -8%
905: $891,095, -2.2%
Total: $945,580, -4.4%

 

RELATED READING

GTA home prices continue to rise

GTA new home market back to typical sales and openings levels in November

GTA moving into balanced market for 2019

Canada’s most and least expensive places to buy – and guess where Toronto is

 

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5 things we can learn from real estate in 2018

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5 things we can learn from real estate in 2018

2018 web

With much of 2018 in the rear-view mirror, It’s been quite the year for the housing market in the GTA and elsewhere in Ontario. From sales and price fluctuations to supply concerns to rising housing costs. As 2019 approaches, here are five things we can learn from real estate in 2018.

 

1 Get used to the affordability issue

Get used to affordability challenges, especially in the GTA. This oft-cited issue is not going away any time soon, despite lobbying from the likes of the Building Industry and Land Development Association (BILD) and the Toronto Real Estate Board (TREB).

Key economic fundamentals such as population and employment growth will continue to drive housing market demand. Over the next decade, almost 700,000 first-time buyers will target the GTA or Hamilton markets, according to a report from the Ontario Real Estate Association. Meanwhile, the supply of new homes is not yet being addressed, which contributes to rising prices.

With recent interest rate hikes and other changes, sales and prices in the GTA saw some moderation in 2018. But this will be short-lived, and a return to price growth is expected.

 

2 Increased government involvement – finally

Government lobbying by BILD and TREB seems to be paying off, in the sense that the Province is increasingly aware of the issues facing the industry – and buyers.

Buyers, you may not realize it, but you should thank BILD, TREB and other associations for that.

In late November, Ontario announced it was committing to a housing action plan “to help create more housing faster, give people more choice and bring down housing costs.”

Like anything involving government, though, this process will likely be slow moving – meaning, some of the challenges, namely increasing housing supply – will take time to be resolved.

But at least the issues are on the agenda.

One real example of this improved awareness is Ontario’s recent plan to change the 40-year-old apprenticeship system in the province – a move the home building industry says is a “game changer.”

It’s a game changer because the new one-to-one ratio, a significant change from the existing 3-to-1 ratio, will enable home builders and renovators to more easily hire and train new apprentices. Besides creating more job opportunities for trades workers, the move also helps builders and renovators operate their businesses

 

3 Fixing on interest rates

The Bank of Canada raised its overnight rate three times in 2018 – January, July and October – to where it sits now, 1.75 per cent.

Canada’s major banks, as is usually the case, responded by immediately raising their own rates.

Naturally, all of this has Canadians feeling a little uneasy.

The Conference Board of Canada’s latest Index of Consumer Confidence confirms that rising interest rates and weaker wage growth have started to take their toll on confidence. With interest charges squeezing Canadian wallets and weakening wage growth offering little reprieve, consumers have become hesitant to make major purchases and are less positive about the state of their finances.

In its latest rate announcement on Dec. 5, the Bank of Canada noted that global economic expansion is slowing, and the effects of the “oil price shock” are being monitored.

“We expect that the Bank will not move the overnight rate until the effects of the declining energy sector are known,”according to interest rate comparison website ratehub.ca. “However, the Bank makes it clear that they still plan on raising the key interest rate in 2019, likely more than once.”

This moderated stance might put downward pressure on fixed rate mortgages, however, so Canadians may see better fixed rates in the coming weeks, ratehub.ca says.

 

4 Real estate is more local than ever

It’s a simple point that escapes some consumers: Real estate is local, and in 2018, it became more local than ever.

What do we mean?

Well, the Canadian Real Estate Association (CREA), Canada Mortgage and Housing Corp. (CMHC) and other major real estate bodies are mandated to oversee the national market.

So, when CREA issues a release that says Canadian home sales are down by X per cent, or when CMHC reports the national vacancy rate is down for the second consecutive year – and major media report such headlines – people tend to worry.

It’s essential to remember, however, that when you buy a home, you don’t buy the national market. You buy one house, on one street, in one neighbourhood, in one city and region.

If you live in Ontario, why do you care that Alberta’s ongoing oil industry struggles are pulling sales and prices down in markets in that province? Or that prices in Vancouver are even less affordable than in Toronto?

Forget the national headlines. Drill down into what’s happening in your market.

And why is real estate more local then ever? Because…

 

5 Lessons from Oshawa

General Motors Canada’s November announcement that it was closing its Oshawa assembly plant sent shockwaves not just through the province but all of Canada. To be sure, the loss of at least 2,500 jobs – not to mention untold positions in related suppliers – in a community of 170,000, is going to hurt. Hurt whom, and how badly, are the only questions.

This development should serve as a stark reminder to us all – of how important it is for cities to develop diversified, modern economies. Overdependence on any one ge, singular industries leads to overexposure in the case of downturns or, in GM’s case, outright shutdowns. It hurts the local economy, which impacts employment and wage growth, which impacts the housing market.

Oshawa, thankfully in recent years, has been diversifying its economy and expanding in technology, education and other industries. It will help, but the impact of the GM closure will likely play out over many months, if not years.

These developments could push housing in Oshawa into a buyers’ market, and prospective buyers could benefit from more options and softening prices.

In new homes, builders remain undeterred, encouraged by the longer-term growth and development throughout the Durham Region. Still, some may offer incentives such as discounts or inclusions to entice qualified buyers.

 

RELATED READING

GTA moving into balanced market for 2019

GTA new home market gains further momentum in October

What the GM plant closure means for Oshawa’s economy and housing market

New home buying opportunities abound in Oshawa and Durham Region

Where are interest rates headed in 2019?

 

 

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Toronto

6 Ontario municipal elections to watch regarding housing

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6 Ontario municipal elections to watch regarding housing

Toronto

By Wayne Karl

The countdown is on – just days to go to the 2018 Ontario municipal elections. In Toronto, in what’s shaping up to be a two-horse race between Mayor John Tory and challenger Jennifer Keesmaat, housing is one of the key issues.

But it’s not the only city or town in and around the GTA where real estate development is a hot topic.

Here’s a select list of a few more municipal elections to watch, and we might as well start with the biggest and highest profile municipality:

TORONTO

Incumbent: John Tory
Challenger: Jennifer Keesmaat
What’s at stake: Housing affordability, or the lack thereof. Both Tory and Keesmaat have announced plans to address the growing affordability issue in the city – what some describe as a crisis. Keesmaat wants to build 100,000 units of “truly affordable, high-quality housing in the next 10 years.” This is a plan some sources in the industry have already declared as doomed to fail.

Tory proposes to build 40,000 affordable rental units over 12 years, or roughly 3,300 annually.

The challenge for both? Defining what affordable housing even is, in a city with median home prices of $883,892, andthe most expensive average one-bedroom rent in the country, $1,900 per month.

Home builders have been lobbying the City and the Province to address land supply and other policies which complicate this already complex issue.

 

MARKHAM

Markham

Incumbent: Frank Scarpitti
Challenger(s): Steven Chen, Shan Hua Lu, Abdul Rahman Malik, Jawed Syed
What’s at stake: As the fourth most populous community in the GTA after Toronto, Mississauga and Brampton, Markham has been a hotbed for economic growth and development for years. It has also become one the most expensive housing markets, with median home prices of almost $1 million for the third quarter of 2018, according to Royal LePageAnd Scarpitti, first elected in 2006 and known as developer- and builder- friendly, has been there through much of it.

 

BRAMPTON

Brampton

Incumbent: Linda Jeffrey
Challenger(s): Mansoor Ameersulthan, former Ontario PC Party leader Patrick Brown, Baljit Gosal, Wesley Jackson, Vinod Kumar Mahesan, John Sprovieri
What’s at stake: Brampton is booming, and Jeffrey is seeking a second term after winning the 2014 election with almost 50 per cent of the vote.

Vision 2040 is an ambitious long-term plan to reinvent Brampton, and includes transformations such as model new neighbourhoods connected by an expanding transit network, new core loop, walking and cycling networks, communities designed to promote walking, and a new eco-park and sustainability built into everything.

There’s also a significant education infrastructure project that will bring a new Ryerson University campus, with Sheridan College as an academic partner, to downtown Brampton for 2022. Oh, along with thousands of students.

 

ORANGEVILLE

Orangeville

Incumbent: Jeremy Williams
Challenger(s): Sandy Brown, Darrin Davidson
What’s at stake: Been to Orangeville lately? It’s no longer a sleepy little pit-stop town as you drive north to Collingwood or Georgian Bay.

With new home and community development taking place, particularly in the west part of town, the biggest challenge Orangeville faces is urbanization. Williams wants to preserve the small town feel and welcome development, while avoiding becoming a discount housing destination for people moving north out of the Toronto area.

Brown, a local realtor, likely understands the issues, and wants to “arrest out of control spending.”  He says Orangeville residents pay the highest property taxes in the GTA.

 

OSHAWA

Oshawa

Incumbent: Current mayor of Oshawa John Henry has given up his seat to run as Durham’s regional chair
Challenger(s): Kenneth Carruthers, Dan Carter, Joe Ingino, Adam Kunz, Sara Lear, Rosaldo Russo, Bob Rutherford
What’s at stake: In short, continued growth in population and economic diversity, which drive housing demand. Oshawa’s population grew to 379,848 in 2016, according to the 2016 Census, up 6.6 per cent from 2011. This is second in the entire province only to Guelph – and even ahead of Toronto at 6.2 per cent.

Oshawa is expected to boast one of the fastest growing economies in the province this year, with growth of 2.6 per cent, according to the Conference Board of Canada. And this is down from 3.2 per cent in each of the last two years.

In terms of housing development, several builders are active in the area with lowrise homes. Homebuyers are liking the comparative bargains and the proximity to Toronto.

 

BARRIE

Barrie

Incumbent: Jeff Lehman
Challenger: Ram Faerber
What’s at stake: Lehman is seeking his third term, while local businessman Faerber is looking to unseat him.

Barrie ceased being a weekend destination years ago, and has become a favourite among real estate investors for its population growth and the job opportunities that come with a growing and increasingly diverse local economy.

However, as a smaller centre (population of 197,059,up 5.4 per cent from 2011), Barrie is sometimes subject to market swings. Median home prices slipped five per cent for the third quarter of 2018, from the same period last year, to $505,136. Some shorter-term good news, however, is that prices are up 0.4 per cent from the second quarter of this year.

Wayne Karl is Senior Digital Editor at Homes Publishing. wayne.karl@homesmag.com 

RELATED READING

Keesmaat’s 100,000 housing plan doomed to fail

5 steps to solving the housing affordability issue in Ontario

Housing policies must focus on supply

 

 

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Real Insight: Looking To The Future

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Real Insight: Looking To The Future

Smart phone apps like TREB’s Collaborate helping to transform the homebuyer’s journey

Every January, the biggest brands in technology and consumer electronics gather in Nevada for the Consumer Electronics Show (CES). There are so many exciting new real estate and home technologies, with smart homes taking centre stage at CES 2018. Below are some of the latest innovations I’m most excited about.

IN THE HOME

No discussion about smart homes would be complete without mentioning Amazon Echo and Google Home. These intelligent personal assistants allow you to interact with technology with your voice and have made it more commonplace to conduct internet searches, play music and make online purchases from your home through speech commands.

These assistants have also led to an increase in integrated, voice-activated smart home products. Products like the Ring Video Doorbell, a smart doorbell that sends alerts, a live video feed and two-way speaking capabilities to your smart phone whenever someone is at your door.

A number of smart light and vent technologies can now also connect with intelligent personal assistants to dim or cool a home based on voice commands.

The kitchen, in particular, is a place where smart home tech is continuing to grow. The FridgeCam, for example, is a product that can be added to a traditional fridge and can suggest recipes based on what’s in your fridge and even indicate when your groceries will expire. Other kitchen technology currently in development includes inductive heating countertops that will intuitively detect and heat pots and pans, while ensuring plates and utensils on the same surface are not heated.

REAL ESTATE TECHNOLOGY

Virtual reality (VR) will work to empower real estate professionals and their clients to tour spatially accurate 3D renderings of multiple listings without the hassle of travelling to multiple locations.

While many VR headsets are expensive, and the technology has a way to go, companies like the Canadianbased Gryd.com have already created budget cardboard VR headsets that allow people to gain 360 previews of listings.

Augmented reality is another developing technology that will allow realtors to superimpose information onto real world environments. By simply having a buyer hover their smart phone camera over a condominium residence, for example, relevant information on the building’s amenities, units available, and more, could be displayed over the screen.

Other products, like the Bluetoothenabled Igloohome Smart Keybox, make it so you can conveniently access the contents of a lock box through an app, while e-signature solutions are continuing to remove the need for pen and paper to finalize a property transaction.

Currently, a number of smart phone applications are also helping to transform the homebuyer’s journey. One such apps is Collaborate by TREB, which allows buyers to search properties across multiple devices, communicate with a TREB realtor in real time, and comment and like/dislike properties while sharing this info with your real estate professional.

Tim Syrianos is president of the Toronto Real Estate Board, a professional association that represents 48,000 professional realtor members in the Greater Toronto Area. You can contact him at TREBpres@trebnet.com. For updates on the real estate market, visit TREBhome.com. If commercial property is what interests you, contact a TREB realtor by visiting TREBcommercial.com.

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