Tag Archives: GTA

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Our economic recovery will be led by building and development

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Our economic recovery will be led by building and development

The COVID-19 pandemic has had a devastating impact on Canada, Ontario and the Greater Toronto Area, and my heart goes out to residents of the GTA who have been affected or lost loved ones to this terrible virus.

Millions of people were let go from their jobs and the economy has all but ground to a halt. As governments at all levels begin to look at recovery, they will need to focus on the GTA. Our region is the heart of Canada’s economy, accounting for 20 per cent of Canada’s GDP and 50 per cent of Ontario’s GDP.

The residential and commercial building and development industry, and the professional renovations industry, are major contributors to economic activity in the region. Collectively, they employ more than 360,000 people in the GTA, paying $22 billion in wages and generating $42 billion in investment value annually. Our industry is well-positioned to play a significant role in the recovery of our region, Ontario, and Canada. Working with our colleagues at both the Ontario and Canadian Home Builders’ Associations, we have put together a roadmap for simple changes that can have a big impact.

Our industry submitted a report to the Ontario Jobs and Recovery Committee that includes 19 recommendations to all three levels of government to get our economy back on track. These recommendations will create an immediate and significant impact to consumers and businesses, and will involve little to no new money from government. Proposed measures include suspending the Canadian mortgage stress test, transferring mortgage tenancy to the date of occupancy for new condominiums, eliminating security deposits for the Ontario land transfer tax on affiliated transfers, and freezing municipal increases to property tax reassessments and development charges. Many people have lost their jobs in all sectors of the economy.

Many projects have been delayed, constraining consumer and industrial/commercial liquidity. Government coffers are also not bottomless, which is why they need to focus on liquidity and freeing up funds that would otherwise be stuck in such things as municipal agreements (refundable deposits paid by developers) and replacing them with surety bonds. These changes can be transitory until such time as we can all fully adjust to the new normal, or when a vaccine for the coronavirus is widely available.

Other suggestions include reinstating home improvement tax credits for homeowners to support ageing-in-place improvements or energy retrofits. In the past, these programs have paid for themselves, since they cut out the black and grey renovation market.

I encourage you to read the full report at bild.ca and support us as we work toward recovery in the GTA, Ontario and Canada through residential and commercial construction and professional renovation.

Dave Wilkes is President and CEO of the Building Industry and Land Development Association (BILD).

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Construction industry to lead post-COVID-19 economic recovery

Construction industry to lead post-COVID-19 economic recovery

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Construction industry to lead post-COVID-19 economic recovery

The new home construction industry is well-positioned to play a significant role in the post-COVID-19 recovery in the GTA, Ontario and Canada, according to the Building Industry and Land Development Association (BILD).

“Working with our colleagues at the Ontario and Canadian Home Builders’ Associations, we have put together a roadmap for simple changes that will have a great impact to the economy,” says David Wilkes, president and CEO of BILD.

The CHBA, OHBA and BILD submitted a 20-point plan to the Ontario Jobs and Recovery Committee to help kick-start the Canadian economy post pandemic.

COVID-19 has had a devastating impact on Canada, Ontario, and the GTA, the groups say. Millions of people lost their jobs and the economy has all but ground to a halt. As governments at all levels start to look at recovery, they will need to focus on the GTA, as the region is the engine of Canada’s economy, accounting for 20 per cent of Canada’s and 50 per cent of Ontario’s GDP.

The residential and commercial building and development industry, and the professional renovations industry, are major contributors to economic activity in the region. Collectively, they employ more than 360,000 people in the GTA, paying $22 billion in wages and generating $42 billion in investment value annually.

Unlock investments

“With all levels of government facing financial challenges and funding requests, we are providing ideas that will unlock consumer and industry construction investments that will kick-start the economy,” says Joe Vaccaro, CEO of the OHBA.

Proposed measures include transferring mortgage tenancy to the date of occupancy for new condominiums, eliminating security deposits for Ontario Land Transfer Tax on affiliated transfers and freezing municipal increases to Property Tax Reassessment and development charges.

Another proposed recommendation is to free up monies that would otherwise be stuck in such things as municipal agreements (refundable deposits paid by developers) and replace them with surety bonds, freeing up billions in potential investments that otherwise would have been parked.

Stimulate growth

“To help stimulate economic growth and keep Canadians properly housed, we will need to foster housing supply while also ensuring demand-side measures are adjusted to reflect the times,” says Kevin Lee, CEO, CHBA. “Accordingly, we recommend 30-year amortizations for insured mortgages, and adjusting the mortgage stress test for both insured and uninsured mortgages. Removing the GST on new homes purchased for 2020 and 2021 would also be a timely catalyst for new home construction.”

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GTA homebuilders upbeat about post-COVID-19 recovery

Municipalities and building industry working together now to ensure housing essential after COVID-19

 

 

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Downtown Toronto

Toronto still one of the fastest growing cities in North America – even with the impact of COVID-19

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Toronto still one of the fastest growing cities in North America – even with the impact of COVID-19

Toronto was the fastest growing metropolitan area in Canada and the U.S. last year, overtaking Dallas-Fort Worth Arlington, Tex., according to new data from the Centre for Urban Research and Land Development (CUR) at Ryerson University.

Downtown Toronto
Photo: Wayne Karl

And even though Toronto will take a hit as a result of COVID-19, it is still expected to be one of the top cities in North America.

Toronto was the only Canadian metropolitan area in the top five; Montreal was sixth and Vancouver twelfth.

Metro Toronto grew by 127,575 persons in 2019, outpacing Dallas-Fort Worth Arlington, which grew by 117,380 persons, to become the fastest growing metropolitan area in all of the U.S. and Canada.

Short-term impact

The research for this latest report was conducted prior to COVID, covering the period of July 2018 to July 2019, so the results are likely to change over the next year, CUR says.

“COVID is estimated to drop immigration (to Toronto) by half this year,” Diana Petramala, senior CUR researcher told Condo Life. “Therefore, this will likely push Toronto down the list of fastest growing cities.

“Toronto’s main strength is immigration, whereas places like Dallas are benefiting from millennials leaving more expensive areas like New York. Toronto, however, will continue to do better than New York, Chicago and Los Angeles – areas that are seeing large outflows of millennials in search of more affordable housing and jobs.”

The impact of COVID in Toronto will be short term, Petramala adds. “Immigration is still allowed, so as other countries move out of lockdown and processing offices open up and airlines start flying again, you will like see a snap back in immigration.”

Outpacing New York

Toronto, in fact, had almost three times the population growth from immigration as New York in 2019. Both regions experienced a loss in resident population to other areas (domestic net migration), but the rate was four times faster in New York.

In terms of population growth on a city basis, as opposed to the metropolitan area (GTA), Toronto (45,742 persons) and Montreal (31,565) represented the two fastest growing cities in all of the U.S. and Canada over the study period. Overall, Canadian cities represented 11 of the top 20 central cities in the U.S. and Canada in population growth, with Calgary, Ottawa and Edmonton placing fourth, fifth and sixth, respectively.

While the city of Toronto’s population grew by 45,742, New York City’s decreased by 53,264.


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In Conversation With… Debbie Cosic, Founder & CEO In2ition Realty

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In Conversation With… Debbie Cosic, Founder & CEO In2ition Realty

New-home buyers, builders and marketers had big plans this spring. Then COVID-19 struck and things changed. Consumers went into a holding pattern, and developers and sales outfits had to figure out what to do.

For In2ition Realty of Mississauga, Ont., a prominent new home and condo marketing firm, that meant pivoting quickly to online and virtual sales. Founder and CEO Debbie Cosic explains how the company responded – and how she sees the market post-pandemic.

How’s the business of marketing and selling new homes and condos during these challenging days?

To say the least, challenging. All of our sales offices are (at press time) currently closed and have converted to online sales. We have been running virtual sales offices across the GTA, and at any given time we have about 20 sites operating.

Fortunately, we’re used to this, as we’re a pretty tech savvy company. This whole challenge has made us kick everything up a notch. We believe the online new home sales world is definitely here to stay. We’ve had to change our method of operations.

We’re still very busy internally with Zoom and conference calls, with developers a couple times a week on various projects. We had 24 sites to launch in 2020, and just before COVID started we basically got two out of the gate. So that means 22 still to launch. Will they all launch this year? We hope so. None of them have been cancelled. We’re hoping that these delays will just toggle things into a fall market, or some of them into the summer market, fall, winter or early next year.

How are consumers responding to virtual sales? Buying a home is obviously a very significant purchase, so to do so without being able to go to the development site…

Even during the shutdown, we have been doing deals consistently. Buyers may be a little slower to consummate the deal, but it always surprises me how technologically savvy everybody is. We’re all online with Facebook or LinkedIn or Instagram. Young or old, people are connected to the computer, they’re online shopping or reading the news every day. So, if you make it simple, which is what we’ve done, using Zoom or FaceTime, our team walks them through all the steps, and we have the presentations ready online. Sometimes it may take a little longer, maybe a second or third meeting, but we make it extremely easy for them to be able to navigate.

We all got some good news when the province announced that construction could resume on May 19. How do you think the market will react – will it quickly lead to renewed buyer interest and activity?

It will spur our whole industry to start moving. Everybody’s sort of gearing up. We have a master blueprint on how to reopen our sales offices safely when the time comes, such as following the government precautions for social distancing, and otherwise doing things to make them feel safe.

We have regular calls on the status of our developments, to get a pulse on the market and feedback from clientele. Some buyers are pushing us to open, we’re getting requests regarding particular projects and we still have people in the pipeline. Do 100 per cent of interested buyers still want to proceed? It’s a new normal now, so we just want to get out there and start selling, whether it’s 80 per cent volume or 50 or 20… We don’t know that yet.

When the restrictions are fully lifted, do you foresee buyers easing their way back into the market, or will there be more of a rush because there might be some pent-up demand?

It may take some time, but I believe things will return to a normal marketplace. In 2019, we had a banner market with 76,500 pre-construction sales in high- and lowrise combined. The first couple of months of 2020, we launched two projects and we basically blew through them, and within a couple of weeks we sold out beyond our construction thresholds. That, we are not expecting, and our brokers are not expecting either. We just believe that we’re going to return to a normal balanced market. And we’re fine with that. Instead of us selling out a development in a couple of weekends, it may take six or nine months or even a year to get to preconstruction thresholds. We’re fine with that.

We’re anticipating a new normal, even in the way we conduct sales, in that we’re not going to be able to have big groups in our sales offices, and these big events that create a lot of hype. We know that it’s going to be a more tempered sale because only smaller groups can come in. As long as you manage expectations, we’re all happy to go back to work and start doing some sales. That’s the important thing.

How do you think homebuyer intentions may change? Do you foresee people buying smaller homes or buying condos instead of lowrise homes or buying more with friends and family?

I think intentions are going to change differently for different segments of the population. Some buyers may enjoy being closer to family, or they’ll prefer a multi-family residence, or a loft upstairs from their parents, or splitting a home with a sibling.

Some experts believe there will be a notable and growing segment of buyers who prefer the bigger homes, larger lots and more space, given everything the pandemic has taught us about being apart from others. Supply and affordability issues in the GTA may preclude that, but areas outside the GTA – Kitchener-Waterloo or Hamilton, for example – may represent opportunities. What are your thoughts?

Definitely. In recent years, areas outside the downtown core have become more desirable…the 905s and some of the 519 areas and even in 705, and that will continue to grow.

I also believe others will migrate back into the city because they will not want to endure public transit, because of concerns over the lack of social distancing.

Do you see any other fundamental changes either for builders or buyers? For example, working from home may become more prevalent, so will home designs further change to accommodate more places people can work separately in the home?

I definitely believe that. Just in my own experience, I have a house with a den, and I have a desk in my bedroom, each of the kids have a desk in their bedrooms, and it’s still not enough. They’re being schooled from home, I’m working from home, the other adults in my house are working from home… We’re all looking for that quiet space, whether it’s a room in the basement, a den in their next house, or a flex space or solarium in a larger condo.

There will also be a portion of population that will want to age in place, so we’ll have to have housing that can accommodate that.

New home supply in the GTA has long been a very serious issue. During the pandemic, governments have clearly shown that when they want to, they can act quickly. How hopeful are you that such legislative agility – clearing red tape and shortening development approval processes – can extend beyond COVID-19?

I’ve been preaching for years that a lot of the legacy supply has been sold off, especially in lowrise and midrise homes. But governments really need to look at the way they’re allowing approvals to occur – not just the speed, but the type of product they’re allowing. They should be allowing more multi-family residences in our subdivisions and communities. I’m not saying we should turn a whole subdivision of 40-ft. lots into triplexes, but you should allow some of these build forms, because they’re desirable, affordable and something we really need.

Instead of a 3,000-sq.-ft. home, why not build a 2000-sq.-ft. home with 1,000-sq.- ft. loft or secondary suite? That kind of thing. Some of this is allowed, but I really think it has to be speeded up, and fast, so on a dime, a developer can change a planning application to have these different types of build forms woven into these communities.

in2ition.ca

And on a personal note …

If I wasn’t in the new home and condo marketing business, I would: Be working on Wall street as a venture capitalist. I love the energy and challenges of that industry, and I love NYC.

My greatest inspiration in this business is: My life partner Ralph, who has taught me to believe in the power of the universe and the power of positive thinking. He has the attitude of “some will, some won’t, others always do.” And if something bad happens, don’t fret over it, learn from it and let it go. Something bigger and better is around the corner.

My greatest reward is: Spending time with my loved ones and surrounding myself with the wonderful group of people who work with us. I’m also grateful this industry has given me not only the financial means but also the time to help people less fortunate than I am. I love and thrive on our charitable endeavours.

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TRREB resale March 20

GTA resale sales see drastic drop in March due to COVID-19

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GTA resale sales see drastic drop in March due to COVID-19

March 2020 resale home sales in the GTA were very much a tale of two markets – pre and post COVID-19.

TRREB resale March 20

The Toronto Regional Real Estate Board (TRREB) reports that 8,012 home sales through TRREB’s MLS System in March 2020 – up 12.3 per cent compared to 7,132 sales reported in March 2019.

However, despite a strong increase in sales for March 2020 as a whole, there was a clear break in market activity between pre-COVID-19 and post-COVID-19 (after March 15).

Market impact

“The overall sales result for March was strong relative to last year, but the impact of COVID-19 was certainly evident in the number of sales reported in the second half of March,” says TRREB President Michael Collins. “Uncertainty surrounding the outbreak’s impact on the broader economy and the onset of the necessary social distancing measures resulted in the decline in sales since March 15. Sales figures for April will give us a better sense as to the trajectory of the market while all levels of government take the required action to contain the spread of COVID-19.”

“While COVID-19 has clearly had an impact on the housing market, the late March numbers still suggest that there is activity in the marketplace,” adds TRREB CEO John DiMichele. “TRREB continues to strongly recommend stopping in-person open houses and has provided its members with guidelines for social distancing. TRREB’s professional development staff are working hard to educate its members via webinars on using technology in innovative ways to conduct business virtually.”

Strong demand

“Despite sales and listings trending lower in the second half of March, demand for ownership housing remained strong enough relative to listings to see the average selling price remain above last year’s levels, including during the last few days of the month,” says Jason Mercer, TRREB’s chief market analyst. “As we move through April, we will have a clearer view on how social distancing measures and broader economic conditions will influence sales and ultimately the pace of price growth.”

The average selling price for March 2020 as a whole was $902,680 – up 14.5 per cent compared to March 2019. The average selling price for sales between March 15 and 31 was $862,563 – down from the first half of March, but still up 10.5 per cent compared to the same period last year.

Revised forecast

TRREB is to release a forecast update in mid-April, after seeing 2020 started with a near-record pace for home sales in the first quarter and double-digit annual rates of price growth.

RELATED READING

How buyers can prepare for the busy buying season – post-COVID-19

What the coronavirus means for Canadian real estate

GTA home price growth to hit 10 per cent this year: TRREB

 

 

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BILD February new home stats

GTA new home sales strong in February

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GTA new home sales strong in February

In what might be the last surge for a while, GTA new home sales were exceptionally strong in February, according to the Building Industry and Land Development Association (BILD).

BILD February new home stats

There were 4,665 total new home sales in February 2020, which was up 211 per cent from February 2019 and 57 per cent above the 10-year average, according to Altus Group, BILD’s official source for new home market intelligence. It was the highest number of new homes sold in February since 2002 and the third highest in the past 40 years.

Single-family surge

It was also the strongest February since 2004 for sales of new single-family homes, including detached, linked and semi-detached houses and townhouses (excluding stacked townhouses). With 2,247 new single-family homes sold, sales were up 228 per cent from last February and 44 per cent above the 10-year average.

Sales of new condominium apartments, including units in low-, medium- and highrise buildings, stacked townhouses and loft units, at 2,418 units sold, were up 197 per cent from February 2019 and 48 per cent above the 10-year average. It was the second strongest February of the past 40 years for new condominium apartment sales, after the record high of February 2017.

February new home sales by municipality

February 2020

Condominium units

Single-family homes

Total

Region

2020

2019

2018

2020

2019

2018

2020

2019

2018

Durham

89

21

4

489

97

49

578

118

53

Halton

227

22

46

380

275

113

607

297

159

Peel

545

127

103

289

193

35

834

320

138

Toronto

1,300

587

1,050

10

4

6

1,310

591

1,056

York

257

57

641

1,079

117

55

1,336

174

696

GTA

2,418

814

1,844

2,247

686

258

4,665

1,500

2,102

 Source: Altus Group

“Following on a month of strong new home sales in February, our industry and our customers are facing a time of challenges and uncertainty due to COVID-19,” says David Wilkes, BILD president and CEO. “We are working diligently to coordinate responses with provincial and municipal authorities, protect workers and customers and ensure that we continue to fulfil our responsibilities to new-home buyers. One of those responsibilities is building enough homes to top up depleted inventory and ensure our region’s new home supply keeps up with demand.”

Pent-up demand

“Prior to the uncertainty due to the COVID-19 situation, the new-home sector in the GTA was on track for a strong sales performance in 2020,” adds Patricia Arsenault, Altus Group’s executive vice-president, Data Solutions. “Low mortgage rates were triggering the release of pent-up demand that had been building on the back of strong employment and population growth, which helped boost February sales.”

In February, the benchmark price for new condo units was $961,268, which was up 21.3 per cent over the last 12 months, and the benchmark price for new single-family homes was $1.09 million, down 2.2 per cent over the last 12 months.

RELATED READING

GTA resale sales see drastic drop in March due to COVID-19

GTA home price growth to hit 10 per cent this year: TRREB

Get ready for a hot market in the GTA this spring

 

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How buyers can prepare for the busy buying season – post-COVID-19

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How buyers can prepare for the busy buying season – post-COVID-19

Spring is typically busy season in real estate, but this year, COVID-19 has brought the market to a slowdown.

One day soon, though – and we hope very soon – things will return to “normal,” and consumers will be back looking for new homes and condos in the GTA and elsewhere, driving the housing market and the economy.

In the meantime, prospective homebuyers can take advantage of this expert advice from a who’s who of new home marketing executives.

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Before COVID-19, the spring market was shaping up to be very strong, based on early sales results so far this year. With historic lows in inventory, especially in the GTA, new lows in interest rates and changes to the mortgage stress test, sales are already very brisk.

The outskirts of the GTA will continue to provide affordable options. Locations such as Brantford, Ancaster, Hamilton, Newcastle and Barrie will continue to offer lowrise alternatives for homebuyers. In Toronto and elsewhere in the GTA, lowrise homes will continue to become available in the form of stacked, back-to-back and traditional townhomes. In the city, the future for lowrise alternatives will continue to be the redevelopment of potential B and C class mom and pop commercial plazas along transit lines.

In the highrise market, we will see a major uptick in 905 sales, as end users and investors see greater value in price per square foot, with continued concerns about pricing in the city. Developers will continue to make units smaller to drive sales in the core, and a new market will emerge north of Eglinton, with better availability of two- and three-bedroom condos for first-time buyers and families wishing to stay in the city.

At the end of the day, always buy within your means and with your family’s best interests at heart.

Joseph Bozzo
Owner
Spectrum Sky
Vaughan, Ont.

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More than 60 per cent of annual new home sales usually occur in a four month period in spring, and with the right preparation, you could experience the joy of buying a home.

1. Eliminate emotion through preparation
A new home purchase will be one of the biggest events of your life, and often an emotionally charged situation. We spend more time preparing to buy a new pair of $100 shoes than we do $1-million property. Uncertainty causes confusion, and confusion leads to indecision and inaction. Knowledge, on the other hand, leads to confidence, and confidence leads to power – so get prepared.

2. Set your priorities
If you don’t know where you’re going, any road will get you there. Focus on your target by creating a Motivation and Housing Needs chart. On the left column, list your (and your partner’s) motivations, such as marriage, family or a new job. On the right column, list your housing needs, noting how your life changes affect your housing needs. This isn’t a wish list, but a very real and practical definition of your current and maybe anticipated housing needs. This step will clearly define your priorities.

3. Dare to compare
If you have selected potential locations and housing types, it’s time to create a spreadsheet and write it all down. List the builder, site and home type on the left, and across the top note the location, home size, financing, price, features and finishings. Give each of these key points a score from one (the least desirable) to five (the most), and come up with a total score for each selected home. The objective is to narrow your favoured choices to two.

4. Know your costs
This is the most fundamental part of the homebuying process, but it’s also the one where people are the most unprepared. The mortgage stress test adds a significant variable to the approval process. How much can you afford? Will you have to “drive till you qualify”? What are your anticipated closing costs? Do you have all the funds necessary? That’s a lot of questions, but the good news is that all of the major banks can help you through this process. Take advantage of this guidance and prepare yourself – well before you attend any open houses or new home openings.

5. Take action
Finally, don’t be indecisive. Once you have conquered the first four steps, you are ready to take action – with confidence.

Andrew Brethour
Chairman & CEO
PMA Brethour Realty Group
Markham, Ont.

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Considering the way prices are these days, it is essential that prospective buyers, as a first step, get pre-approved for a mortgage. And be aggressive about finding financing. If you don’t have the full deposit, you can always go to a B lender for a second mortgage or line of credit. Some buyers are fortunate enough to be able to obtain funds from the “Bank of Mom and Pop.”

If all else fails, look at purchasing a unit with a friend or family member for co-ownership. You can both live in it as roommates, or sell it outright and take the profit as your seed deposit money for your own individual units.

My point is: Move heaven and earth to get into the market. Prices are going up, and supply is still very tight, which bodes well for owners. If you postpone, as the years pass, prices will be even higher, and you’ll wish you’d gotten into the market years ago. Think about how happy homeowners who bought several years ago are today, having seen their financial investment grow.

Remember, too, that whether you buy a condo, townhouse, semi- or single detached house, it doesn’t have to be in Toronto or the GTA. Keep an open mind and you’ll find great affordability in markets such as Hamilton, Kitchener and even Picton.

Expand your horizons and be prepared to try alternative methods for attaining homeownership. In the end, it will all be worth it.

Debbie Cosic
Founder & CEO
In2ition Realty
Mississauga, Ont.

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New home sales were off to a great start this year, and developers are working hard to offer more affordable housing solutions and incentives. If you’re in the market for a new home or condo, it’s definitely a great time to buy.

Just make sure you know what you want (or really need) and have shopped the competition to ensure you’re investing in the right neighbourhood, product and builder.

Consider locations outside Toronto and elsewhere in the GTA that are close to transit. Places such as Hamilton and Milton are especially hot, with some exciting new projects geared toward first-time buyers. Meanwhile, pockets of Pickering and Ajax still offer exceptional value for growing families.

We’re also seeing a lot of empty nesters eyeing cottage country in locations such as Collingwood, Blue Mountain and Huntsville, where you’ll find beautiful, four-season lifestyles, complemented by the same urban amenities you’d find in the city.

Tami Kenwell
President
Madhouse Advertising
Toronto

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In Toronto and elsewhere in the GTA, demand will continue to exceed supply for the foreseeable future. We are looking at ongoing population growth from immigration and migration, as Toronto continues its role as an international city and economic hub. Market prices will only increase as time goes on. With the average rent for a one-bedroom apartment in Toronto already more than $2,500 per month, a new condo is still a wise and likely lucrative investment.

Carefully selecting the right location is a key starting point; location, location, location has long been the mantra for real estate. Choose a building in an up and coming area for a better price point, or in an established neighbourhood where you’re likely to pay a little more. Either way, buy the best condo and suite you can for the money, keeping in mind your lifestyle. Proximity to transit is also important; consider that investors usually purchase close to mass transit, since that’s a feature that appeals to renters. It’s all common sense.

This market will not change overnight, and may never change. We are still in a low-interest-rate environment… and who knows how long that will last? If you are in a position to get into the condominium ownership market, my advice is to buy now, rather than later.

Barbara Lawlor
President & CEO
Baker Real Estate Inc.
Toronto

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Friends often ask me where the best value in the GTA is, since I have been marketing new homes and condos for 25 years. What area has the best opportunity for appreciation?

I usually recommend heading east, to Courtice, Ajax, Bowmanville, Oshawa… really anywhere in Durham or Clarington is a great option for new-home buyers today. East GTA offers very affordable pricing compared to the west, as well as every feature you could ever need, including regular GO Transit service to downtown Toronto, easy access to the lake and beautiful conservation areas for hikes. There are excellent schools, tons of shopping and a great family lifestyle. The east is where it’s at!

I would also advise prospective buyers to explore the federal government’s First-Time Home Buyer Incentive program which offers a down payment boost of up to 10 per cent. It doesn’t need to paid back until you sell your home, at which time the government will share in the equity you have built up over time. It’s an excellent opportunity that not enough people are taking advantage of yet.

Lianne McOuat
Vice-President, Strategy
McOuat Partnership
Markham, Ont.

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Spring is typically the busy season in real estate, and this year the market in southern Ontario looked like it was really going to heat up. But this area is so popular year-round it’s unique: Traditional seasonality is quickly blurring. High demand, combined with a shortage of housing supply, ensure this trend will continue. In resale, for every house listed for sale there is a buyer ready and waiting. The best thing buyers can do to ensure they get what they want, when they want, is to get themselves in the ready position.

Despite mainstream media suggesting it is next to impossible to purchase a home here, opportunities present themselves all the time, especially to those who are ready to go. New homes provide a great option. By signing up for mailing lists of reputable builders in your areas of interest, prospective buyers will be the first to know when a community is coming, what the housing options are and what the price points will be. This process, and the information that comes with it, gives buyers knowledge to make informed decisions, better positioning them for their next move.

Fraser M. Wilson
Senior Vice-President
International Home Marketing Group
Toronto, Ont.

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Humber Bay, Etobicoke

Why Canadians should think long term in real estate – especially now

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Why Canadians should think long term in real estate – especially now

Humber Bay, Etobicoke

Unprecedented doesn’t even begin to describe it. A few weeks ago, we awaited an exceptionally active spring real estate market in the GTA, buoyed by the recent easing of mortgage regulations and interest rates.

Now, however, instead of seeing a spike in buying activity, we’re hunkering down, battening down the hatches and riding out the COVID-19 crisis, all in an attempt to flatten the curve.

Historic, surreal and unbelievable might be more suitable adjectives to describe these times.

And under such circumstances, with normal life routine displaced by the daunting and unknown, people naturally tend to worry.

In real estate, if location, location, location is the No. 1 rule of thumb, thinking long term is right there along with it, as 1A.

We’ve been through similar challenging times: The 1989 recession, Y2K, 9/11, the Great Recession of 2008-09 and SARS. Now we face COVID-19.

At times of economic uncertainty and extreme stress in the marketplace, people always revert to their number one emotional and financial investment – their home. People trust real estate. Buying that first condo, a new home for their growing family, downsizing once the kids move out or renovating the place you already love.

And, so it will be again.

Long-term lift

But don’t take our word for it. Consider, for example this report from the Real Estate Investment Network (REIN), a national group of investors which bases everything it does on independent research.

According to the REIN Special Report: The Coronavirus’ Impact on Canadian Real Estate, Canadian real estate will see an immediate cool-down – but a long-term lift. We may see a temporary decrease in GDP growth, but key drivers of real estate such as population growth and increased foreign capital, demand and property values will eventually rise.

“It’s still premature to predict how the coronavirus outbreak will be resolved, but data suggests that panic will only worsen the country’s economic situation,” says Jennifer Hunt, REIN’s vice-president of research. “There is reason to be alert, but there’s absolutely no reason to further raise alarm and cause more public fear. In fact, as a Canadian real estate investor, this may represent a buying opportunity for investors, with a likely future positive lift in rental and housing markets.”

Open for business

It might be a stretch to say it’s “business as usual,” but life does have to go on, as soon and as safely as possible. New home builders and developers are open for business, are accepting presentation centre visits to by appointment only, and as much as possible are moving communications to digital.

Meanwhile, the Bank of Canada recently lowered its influential overnight rate target twice in less than two weeks – from 1.75 to 1.25 per cent on March 4, then again to 0.75 per cent on March 16. Canada’s Big Five banks are following suit by lowering mortgage rates, and they, too, are increasingly going digital to facilitate business.

Buyer-friendly

All of this means the opportunities to buy are still there (though with a modified process), with less short-term competition and a more buyer-friendly mortgage and borrowing landscape.

Indeed, as challenging as these times may be, it’s even more important to focus on the long term. And on that front, new-home ownership in the GTA is still a solid investment.

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The numbers don’t lie

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The numbers don’t lie

Now is the time to fix the housing supply problem in the GTA

Every month, BILD reports on new home sales in the GTA. This data is collected and compiled by the Altus Group and provides us with important information on how many new homes were sold, the average asking price and the remaining number of new homes in builders’ inventory. It is an important tool that gives those involved in housing, real estate and development real time insight on how government housing regulations, fiscal policy, economic conditions and consumer confidence influence the housing market in the region.

BILD recently released the 2019 year end new homes sales data, showing that GTA new home sales rallied from the 22-year low of 2018. Overall in 2019, there were 36,471 new homes sold in the GTA. Only 24,855 new homes had been sold the previous year, which made 2018 the year with the lowest number of new home sales in the GTA since 1996.

There were 26,948 condominium apartments, including units in low-, medium- and highrise buildings, stacked townhouses and loft units, sold in 2019, up 27 per cent from 2018 and 16 per cent above the 10-year average. Singlefamily homes, including detached, linked, and semi-detached houses and townhouses (excluding stacked townhouses), accounted for 9,523 new home sales, up 157 per cent from 2018 (the lowest year for new singlefamily home sales since comprehensive tracking started in 1981), but still 30 per cent below the 10-year average.

So what do these numbers mean? At first glance, it looks like new home sales were solid for 2019, but that was not the case. That’s what happens when the market recovers from the 22-year low of the previous year and new home sales remain 30 per cent below the 10-year average. What we saw in 2019 was a release of pent up demand from 2018.

We need to keep our focus on increasing housing supply, making sure that there’s a solid inventory base to ensure that housing prices remain stable. Consumer demand has not diminished; in fact, as the region continues to grow, we can be sure it will remain robust and we must make housing more affordable for the average person living in the GTA by eliminating barriers and build homes faster. We have to accept that demand will continue to increase, and both the building industry, municipal governments, and the provincial government must work together to keep all types of housing (rental and ownership) within reach.

On average, it takes 10 years to build a typical highrise project and 11 years to complete a lowrise project in the GTA. New homes must be built faster. Layers of bureaucracy, outdated zoning, and complex policies and procedures have created barriers to the efficient operation of the housing market that have resulted in a generational shortfall of housing. These obstacles have delayed the development of new homes, and have contributed to the increase in housing costs experienced over the past decade.

In addition, demand for new housing has increased as the Greater Toronto Area has become one of the most desirable places to live. The GTA is the fastest growing region in North America, with an estimated 115,000 new residents arriving every year. The population of the GTA is set to grow by 40 per cent, or an estimated 9.7 million people, by 2041; that timeline is not far away.

In May, 2019, the Ontario government announced the Housing Supply Action Plan, representing the first major step by any provincial government to address the supply challenges facing the housing market and their effects on affordability. The proposed changes also acknowledge the cumulative effect that taxes, fees and charges have on housing affordability. Land transfer taxes, HST, parkland fees and development charges collectively add $124,000 to the cost of an average new condo in the GTA, and $222,000 to the cost of an average new singlefamily home.

This is not a time for small plans. The numbers don’t lie. This year, all levels of government and our industry must continue to work together so we can fix the housing supply problem in the GTA.

Dave Wilkes is president and CEO of BILD (Building Industry and Land Development Association), and can be found on: Twitter.com/BILDGTA Facebook.com/BILDGTA YouTube.com/BILDGTA and BILD’s official online blog: BILDBlogs.ca

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Moving into a home the smart way

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Moving into a home the smart way

Whether you are a first-time homebuyer, a professional couple, a growing family or an empty-nester, if you are considering the purchase of a new or resale condominium suite or lowrise home with a condo component, it is best to be aware and prepared. The following are a few tips to get yourself organized so you come up with the best choice.

  1. Ask yourself, what are your personal and family needs? My advice is to make a list of priorities. Are you buying for the first time? Upsizing? Downsizing? Are you looking for more space, less space, or if you’re living in your parents’ basement, will any space at all do? Do you like the idea of having a backyard in a townhome, or does the idea of having beautiful condo amenities under your roof appeal? If children are involved, do you require proximity to a school? Realize that size is relative – you will find condo suites that are larger than some townhomes, and vice versa. Keep layout at the top of your interior priorities. Think about how you like to live and determine which plans accommodate those needs.
  2. Once you want to start looking around, hire a good realtor. The marketplace is packed with choices (including condominiums and lowrise homes with a condo component) in Toronto and the GTA. There are realtors who are familiar with the area you select, and they will guide your search. Remember that purchasing a condominium is different from freehold lowrise; it is wise to work with a realtor who can help you understand all of the nuances.
  3. Consider pre-construction for a variety of reasons. Resale is fine for some shoppers, but in many ways, it is like wildly looking in the dark. Buying early in the selling cycle of a new mid- or highrise condominium usually allows you a two-to-five year window until move-in, which means you can save more for your down payment, and you will likely earn equity before you even take possession. Many condo purchasers nowadays earn 20 to 40 per cent in equity prior to closing. This is huge for anyone, but especially young first-time buyers.
  4. Next, get your finances in order. Find out what you can afford, and buy as much as that allows for – as long as you’re comfortable with it. You know what debts you have to pay off and how much disposable income you need each month to keep up your current lifestyle. If you are downsizing from a large lowrise home, you have to decide how much money to take out of the home, how much to invest, and whether to use a condo as your main residence or a second property.

There are condominiums popping up in Regions of Peel, Halton, York and Durham, where prices are more attainable than Toronto. From Mississauga to Pickering and beyond, you will discover a plethora of choices with differing architecture, amenities, views, layouts, sizes and prices. The goal is to find the right one for you, and a realtor can help you along the way to your best decision.

Debbie Cosic, CEO and founder of In2ition Realty, has worked in all facets of the real estate industry for over 25 years. in2ition.ca

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