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Forecast 2019 – where are Canada’s hottest housing markets?

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Forecast 2019 – where are Canada’s hottest housing markets?

2019 web

Wondering where Canada’s hottest housing markets are, as 2018 comes to a close and 2019 is just around the corner? Well, that all depends on who you ask.

Two of Canada’s large realty firms – Royal LePage and ReMax – both issued their 2019 housing market outlooks on Dec. 11.

Yes, the very same day.

Rather than produce two stories on the exact same topic, just from different sources, we thought it would be interesting to compare them. And while there are some commonalities in their forecasts, there are also some interesting discrepancies.

There is no ‘Canadian’ market

Let’s begin with the headline of ReMax’s 2019 Housing Market Outlook: “Canadian home prices expected to increase by 1.7 per cent in 2019.”

Yeah, about that. Forget that headline. As we recently wrote, those national numbers are pretty meaningless. It’s like trying to summarize the weather, temperature or traffic as “Canadian.”

But, just for comparison purposes, ReMax estimates Canadian home prices will grow 1.7 per cent in 2019; Royal LePage, 1.2 per cent.

National numbers that do matter are interest rates, GDP growth and employment. Then there’s immigration, which affects some markets more than others, mortgage regulations and housing supply. All of these factors are the key drivers of real estate. But more on that later.

Now let’s take a look at some of the regional highlights.

GTA

ReMax says:

  • Toronto average prices down 4% in 2018 to $789,181
  • Toronto average prices forecast to rise 2% in 2019 to $804,964

In Toronto, rising interest rates and the mortgage stress test were the two major factors affecting market activity in 2018, with average sale prices dropping by four per cent from $822,572 in 2017 to $789,181 in 2018, and unit sales down by 16 per cent. Lack of affordability in the single-detached segment will make it difficult for buyers wanting to enter this market. Resale condos, on the other hand, now represent almost 37 per cent of total sales, fueled by affordability.

ReMax Housing Market Outlook, select major markets

Region 2018

 Average Home Price

 

2019

Average Home Price

(Forecast)

Year-over-Year

(%)

Vancouver $1.05M $1.01M -3.0%
Edmonton $379,539 $360,562 -5.0%
Calgary $487,399 $487,399 0.0%
Saskatoon $333,187 $343,182 0.6%
Regina $322,500 $322,500 0.0%
Winnipeg $323,001 $335,921 4.0%
Windsor $299,750 $329,725 10.0%
London $379,654 $398,636 5.0%
Kitchener-Waterloo $473,275 $487,473 3.0%
Hamilton-Burlington $707,949 $849,538 2.0%
Barrie $477,839 $492,174 3.0%
Oakville $1.08M $1.13M 5.0%
Mississauga $705,406 $733,622 4.0%
Brampton $577,846 $600,959 4.0%
Durham $594,585 $612,422 3.0%
Toronto $789,181 $804,964 2.0%
Ottawa $678,670 $705,816 4.0%
Halifax $299,982 $308,981 3.0%
St. John’s $265,523 $265,523 0.0%

 

Elsewhere in Ontario

Rising interest rates and the stress test continue to make it difficult for prospective buyers in Barrie, Oakville and Durham regions.

“This is particularly true for first-time buyers and single Millennials, as evident in cities like Brampton, Kingston and Durham,” says Christopher Alexander, executive vice-president and regional director, ReMax of Ontario-Atlantic Canada.

Hottest in the province

The hottest market in Ontario? Windsor, which showed price growth of 13 per cent in 2018, to $299,750, with another 10 per cent increase forecast for 2019. London is also expected to be strong, with prices to increase another five per cent next year, after rising 17 per cent this year to reach $379,654.

 

Royal LePage says:

  • GTA average price in 2018 $844,000
  • GTA average price forecast to rise 1.3% to $854,552

“Compared to the record pace of home appreciation seen in 2016 and 2017, the GTA housing market is now positioned for much healthier and sustainable growth in future years,” says Chris Slightham, broker and owner, Royal LePage Signature Realty.

Many regions outside of Toronto’s core saw price declines in 2018, a result of overshooting in previous years. The continued population growth should cause the suburbs to stabilize and reignite price growth. In addition, the potential subway expansion into the suburbs should stabilize and increase home prices in close proximity to new transit infrastructure.

Elsewhere in Ontario

The median price in Ottawa is expected to increase 2.5 per cent in 2019 to $487,910, benefitting from the city’s healthy economy and high income per household, driven by the public and technology sectors.

Interestingly, Royal LePage also notes that neither the new mortgage rules nor recent interest rate hikes have notably affected Ottawa’s housing market.

 

Highlights from other Canadian markets

The star performer of all major Canadian markets in 2019? Montreal, according to Royal LePage.

“Quebec will out-perform the nation in 2019,” says President and CEO Phil Soper. “Like other regions of the country, the economy is strong and people are working. What is different is affordability. We have to remember that Montreal sat out the rapid home price inflation we saw in Vancouver and Toronto this decade, and in Calgary the decade before.”

As for the ReMax outlook for Montreal, Quebec did not participate in this year’s forecast.

 

 

Royal LePage Market Survey Forecast

Region  

2018 Aggregate Home Price
(Year End Estimate)


2019 
Aggregate
Home Price 
(Forecast)
Year-over-Year (%)
Canada $631,000 $638,257 1.2%
Greater Toronto Area $844,000 $854,552 1.3%
Greater Montreal Area $409,000 $421,306 3.0%
Greater Vancouver $1.28M $1.29M 0.6%
Ottawa $476,000 $487,910 2.5%
Calgary $484,000 $473,104 -2.3%
Edmonton $386,000 $378,691 -1.9%
Winnipeg $306,000 $309,829 1.3%
Halifax $321,000 $326,096 1.6%
Regina $327,000 $311,505 -4.7%

 

Influential factors

Now for more on those national factors that do influence real estate.

“I would call attention to two factors influencing our forecast that deserve special consideration,” says Soper. “Firstly, home prices are appreciating, albeit at a snail’s pace. Secondly, the Canadian market is supported by strong economic fundamentals, including a robust rate of new household formation and excellent employment growth.

“The future for Canadian housing remains bright, perhaps too bright. With an increasing number of gainfully employed people looking to put a roof over their heads, and the scarce availability of rental accommodation, policy makers in our major markets will once again be struggling with housing shortages. More than an affordable housing problem, we will once again be facing an overall housing supply crisis.”

As for interest rates, the Bank of Canada held its benchmark interest rate of 1.75 per cent on Dec. 5, citing a weaker than expected energy sector. Further rate increases are expected in 2019, making it more difficult for Canadians to buy a home in 2019.

The Bank forecasts GDP will increase 2.1 per cent in 2019, a modest increase over 2018, while Canada’s unemployment rate fell to 5.6 per cent in November, the lowest on record since 1976.

RELATED READING

5 things we can learn from real estate in 2018

7 factors that will affect GTA housing in 2019 – and 5 reasons to consider buying NOW

GTA moving into balanced market for 2019

GTA new home market gains further momentum in October

Delays in approval process contributing to housing affordability issue in GTA

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

 

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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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GTA moving into balanced market for 2019

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GTA moving into balanced market for 2019

Although the Greater Toronto Area housing market is somewhat in balanced territory, buyers and sellers are both up against the ropes.

This year has changed so much from the last five to 10 years. Both buyers and sellers have been affected in both positive and negative ways. For me, when working with a buyer and investor client, it was always a tailored approach. However, now more than ever, we have to be extremely diligent when analyzing residential types, location and price range.

In past years, it was much more common to think about flipping real estate or short-term investments. Now? Not so much. There is a total shift to a minimum five- to 10-year hold. Since the introduction of the stress test, some real estate markets took a hit. Buyers are also now faced with additional challenges such as qualification rules and rising interest rates.

Glass half full

Although there are pros and cons in today’s market, take a glass half full approach. Just think, in the past, is was very challenging for a seller to move up to a bigger property. There were bidding wars, price increases that exceeded pay raises, and to top it all off, extremely low inventory – which meant buyers might have to settle for something they might not fully love. The trade-off was a low interest rate environment. If you were a seller, it was nice to think you could sell your property for top dollar, but the million-dollar question was where will you buy next?

Also read: GTA home prices continue to rise

Also read: GTA new home market gains further momentum in October

Also read: GTA condo sales and prices hit record levels

Today, if a seller wants to move up, they can usually find a good deal and sell their property for a fair market value. Maybe your property went down 10 to 15 per cent, however, you are also buying your next home for the same 10 to 15 per cent less. Another benefit to such market conditions is that there are more deals to be had.

Notably, there have been fewer first-time buyers out there recently. Even a larger down payment might not cut it anymore, due to higher interest rates. This is why the condo market is doing well, especially the smaller and less expensive properties, due to affordability. The new reality could well be more people renting for a longer period.

Rising rates

The qualifying rate today is slightly more than six per cent. “The recent rule change with regards to the stress test basically decreased people’s max mortgage amount by about 15 to 20 per cent,” says Michael Yosher, director of lending at Integrity Tree Solutions Inc. “The 2019 horizon looks like this trend will continue, as Bank of Canada and economists are predicting several interest rate hikes, which will further reduce the amount of mortgage a buyer will qualify for. This has really taken the wind out of first-time buyers. Family members helping out with gifted down payments and cosigning mortgage loans are the trend these days.”

According to the Toronto Real Estate Board, in October 2018 compared to last year October, average sales prices were up 3.5 per cent. Although this is good news for some sellers, most of this price growth is driven by the condominium market, which at one point lagged behind detached, semi-detached and townhouse product.

Arie Buzilo is a real estate broker with Century 21 Leading Edge Realty Inc. Brokerage, and an investor specializing in buying and selling properties in the GTA.

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GTA home prices continue to rise

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GTA home prices continue to rise

Toronto homes web

Greater Toronto Area average home prices continued their upward trajectory in November, rising 3.5 per cent year-over-year to $788,345, according to the Toronto Real Estate Board (TREB).

GTA realtors report 6,251 residential transactions through TREB’s MLS system in November 2018, down by 14.7 per cent compared to November 2017, when there was a temporary upward shift in demand caused by the looming OSFI-mandated stress test at the end of last year.

“New listings were actually down more than sales on a year-over-year basis in November,” President Garry Bhaura says. “This suggests that, in many neighbourhoods, competition between buyers may have increased. Relatively tight market conditions over the past few months have provided the foundation for renewed price growth.”

On a preliminary seasonally adjusted basis, sales were down by 3.4 per cent compared to October 2018.  The average selling price after preliminary seasonal adjustment was down by 0.8 per cent, compared to October 2018.

Average home prices, November

Toronto (416)
2018: $842,483
2017: $803,540

Rest of GTA (905)
2018: $750,721
2017: $732,848

GTA
2018: $788, 345
2017: $761,410

“Home types with lower average price points have been associated with stronger rates of price growth over the past few months,” says Jason Mercer, TREB’s director of market analysis. “Given the impact of the OSFI-mandated mortgage stress test and higher borrowing costs on affordability, it makes sense that the condo apartment and semi-detached market segments experienced relatively stronger rates of price growth in November, as market conditions in these segments remained tight or tightened respectively over the past year.”

Looking at the housing market from a policy perspective, TREB says it is encouraged with the provincial government’s recent announcement and on-going public consultation regarding a housing supply action plan.

“Housing supply remains a key issue in the GTA market,” says TREB CEO John Di Michele. “More specifically, an adequate supply and appropriate mix of housing types must be part of the conversation, as has been recognized by the provincial government in their consultation documents. Transit supportive and gentle density ‘missing middle’ housing should be a priority.”

 

GTA average prices and percentage gain by home type, November 2018

Detached: $1.01M, 1.3%
Semi-detached: $791,760, 8.3%
Townhome: $647,418, 3.1%
Condo: $556,723, 7.5%

TREB has commissioned research on these subjects and is holding a Market Outlook Economic Summit on Feb. 6, 2019.

“TREB is also encouraged that the provincial government remains committed to public transit expansion,” adds Di Michele. “TREB has long advocated for improvements to the Greater Golden Horseshoe transit and transportation network, and feels the time is right to have a conversation about the level of provincial and municipal responsibility that would be the most efficient arrangement to realize subway expansion sooner in Toronto, and the GTA, as this will impact the housing market.”

 

RELATED READING

GTA new home market gains further momentum in October

Delays in approval process contributing to housing affordability issue in GTA

7 factors that will affect GTA housing in 2019 – and 5 reasons to consider buying NOW

 

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GTA new home market gains further momentum in October

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GTA new home market gains further momentum in October

 Condos Oct web

The GTA new home market saw a relatively active month for new condominium apartment and single-family home sales and openings in October, according to the Building Industry and Land Development Association (BILD).

There were 2,805 condominium apartments in low, medium and highrise buildings, stacked townhouses and loft units sold in October, down 44 per cent from October 2017 but only one per cent less than the 10-year average, according to Altus Group, BILD’s official source for new home market intelligence. Single-family home sales, with 491 detached, linked and semi-detached houses and townhouses (excluding stacked townhouses) sold, were even with last October and down 64 per cent from the 10-year average.

With 21 condominium apartment projects and 14 single-family home projects opening in October, remaining inventory increased to 16,283 units, comprised of 10,982 condo apartment units and 5,301 single-family units. Remaining inventory includes units in preconstruction projects, in projects currently under construction and in completed buildings.

October best month

“The pickup in interest from builders and home buyers that started to emerge in the GTA new home market in September gained momentum in October,” says Patricia Arsenault, Altus Group’s executive vice-president, Data Solutions. “October was the best month we’ve seen this year not only in terms of sales – for both single-family homes and condominium apartments – but also new project openings. And for both sales and new openings, the increases from last month were stronger than the typical seasonal pattern.”

David Wilkes, BILD president and CEO, says the new home market’s gradual return to more typical activity levels was an encouraging sign. “It’s clear that when we are able to bring on more supply and give new home buyers more product to choose from, they get excited and motivated about making that choice. That’s why we are especially heartened by the new provincial government’s commitment to increasing housing supply through its Housing Supply Action Plan.”

Benchmark prices

The benchmark price for both condo apartments and single-family homes decreased slightly in October, compared to the previous month. The benchmark price for condo apartments was $775,537, which was still up 14.5 per cent over the last 12 months. The decrease in the benchmark price of condo apartments from September can be accounted for by the smaller benchmark size of units available to purchase. The benchmark price for single-family homes was $1.11 million, down 8.4 per cent over the last 12 months.

October new home sales by municipality

October 2018 Condominium Apartments Single-family Total
Region 2018 2017 2016 2018 2017 2016 2018 2017 2016
Durham 79 19 96 55 207 323 134 226 419
Halton 328 162 375 78 69 515 406 231 890
Peel 169 110 203 148 48 177 317 158 380
Toronto 2,133 4,085 1,478 74 28 14 2,207 4,113 1,492
York 96 613 336 136 139 621 232 752 957
GTA 2,805 4,989 2,488 491 491 1,650 3,296 5,480 4,138

 Source: Altus Group

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GTA new home market shows some improvement in September

New homes today offer countless benefits

Builders constantly improve energy efficiency of new homes

 

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In conversation with Jim Ritchie of Tridel

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In conversation with Jim Ritchie of Tridel

It’s always a pleasure to spend time with the smart and insightful Jim Ritchie, executive vice-president of sales and marketing at Tridel, one of Canada’s largest and best condominium builders. In its eight decades, Tridel has built more than 80,000 homes, and that’s something to celebrate!

Tridel was founded by Jack DelZotto in 1934, when he built his first single-detached home near Dufferin and Bloor Streets. Jack, who arrived in Canada from Italy in 1927, was a stonemason by trade who worked in the mines in Timmins before coming to Toronto. (He helped lay the bricks at the Park Plaza Hotel. How’s that for history?).

Jack’s three sons — Angelo, Elvio and Leo — were brought into the company, and continued to grow the organization into what it is today. The name of the company evolved to Tridel (after the three DelZotto brothers).

The DelZottos have always been known as innovators and built their first rental apartment complex in 1961, featuring twin towers, a swimming pool, a recreation centre and landscaped grounds — quite luxurious for the times — the forerunner of today’s modern condo.

Today, the DelZotto brothers and their lifelong business partner Harvey Fruitman — along with their families — have carried on the tradition set by Jack of complete communities, environmental awareness and technical innovation. And it has grown.

As Ritchie tells me, Tridel manages every part of the development of a condominium project.

“We handle the entire process — land purchase, planning, approvals, marketing, selling, building, customer service and management. Overall, we control the customer experience from purchase to residency.”

In fact, in addition to Tridel, the Tridel Group of Companies consists of Deltera (construction services and management), Del Realty (real estate brokerage), Del Property Management (condominium property management), DelSuites (long-term furnished executive accommodations), Del Condominium Rentals (full-service condo rentals), Delmanor Retirement Living (seniors’ accommodations), Delcare (long-term seniors’ care facilities) and Del Management Solutions (residential and commercial property management).

Q: Did Tridel make a conscious decision to move from ground related housing to apartments and condominiums?

A: The transition from single-family homes to building rental apartments was an evolution. Tridel built a rental apartment complex complete with amenities and landscaping, which essentially became a model for the condominium we know today.

In 1967, when condos became a legal entity in Ontario, Tridel embraced the concept and started developing its first condominium the following year.

Q: What are your thoughts on the condo market in the GTA?

A: Toronto has the largest new condo market in North America. The market was outstanding in 2017, which was an exceptional year fuelled by many factors. But that record-breaking year couldn’t be sustained, and with a number of government interventions, including new mortgage rules, the market has levelled somewhat as compared to previous years.

We see consistent and long-term growth in the GTA housing market, especially with a strong economy and continuing growth in population. But it’s really very difficult to make predictions.

The success of the industry is predicated on relative affordability and more recently condos have become very popular because of the increasing cost of other forms of housing — 25 per cent of the cost of a home is various fees and taxes.

Q: What is Tridel’s philosophy of building condo communities?

A: We are city builders — actually all highrise builders are city builders — and at Tridel we put more focus on architecture and the public realm. Architecture matters and consumers understand that. Today’s consumers are well informed on these matters.

But it’s not easy, there are no easy projects anymore. No longer can we raze a parking lot and build a condo. There just aren’t any of these types of sites left. And creating real communities, which means mixed-use developments, brings more complexity.

Q: How have you seen suite design and amenity space changed over the years?

A: Architecture matters to Tridel and that includes suite designs that can optimize the use of space, and user-friendly amenities, which have changed over the years and now include more family-oriented spaces.

Evermore at West Village in Etobicoke offers some of the most current amenities and suite designs, including two- and three-bedroom suites for family living with larger entrances and bigger laundry rooms with more storage.

Some of the more in-demand amenities include shared workspaces and study pods, kids and youth zones and large outdoor terraces.

We’ve also found that putting the larger units in one area of the building — at Evermore they are in the podium — means that families can live near each other and that creates a sense of community.

Q: Tridel has a reputation for being in the forefront of green technology. Has that always been the case?

A: Tridel has always been on the leading edge of new construction methodology and energy-efficient building practices. These include the fundamentals of building design, including the building envelope and mechanic al systems. In 2005, we brought our first LEED building into the marketplace, and now we lead sustainable residential condominium development in Canada.

Q: What new innovations does Tridel have in the works?

A: I’m very excited by Tridel Connect, an innovative range of integrated smart home features, which we recently rolled out very successfully at our Ten York community. Some of the features of Tridel Connect include the ability to set the temperature, security alarm and receive notifications about community events through an in-suite wall pad or remotely with a smartphone app. Suite locks are also dig ital, opened with a personalized code, and additional codes can be programmed for service people, like a cleaner or dog walker.

You can also use the wall panel to connect visually with the concierge and select common areas, and you can open common-area doors with your smartphone, so no more key fobs. That also applies to the garage door, where a camera uses license plate recognition to provide entry.

We had this technology developed about six years ago, but we wanted to make sure we had worked out all the kinks before announcing it. It will be included in many Tridel condos going forward.

PORTFOLIO

  • Evermore at West Village, Eva Road & Hwy. 427
  • Aqualuna at Bayside, Queens Quay & Sherbourne
  • Auberge on the Park, Leslie & Eglinton
  • Auberge II on the Park, Leslie & Eglinton
  • Bloor Promenade, Bloor & Islington
  • Bloorvista, Bloor & Islington
  • Islington Terrace, Bloor & Islington
  • Bianca, Dupont & Bathurst
  • Via Bloor, Bloor & Parliament
  • Via Bloor 2, Bloor & Parliament
  • Aquabella at Bayside, Queens Quay & Sherbourne
  • Ten York, York & Harbour
  • Alto and Parkside at Atria, Sheppard & Hwy. 404
  • Trio at Atria, Sheppard & Hwy. 404
  • Parfait at Atria, Sheppard & Hwy. 404
  • Aqualina at Bayside, Queens Quay & Sherbourne
  • Aquavista at Bayside, Queens Quay & Sherbourne
  • Alter, Church & Carlton
  • 101 Erskine, Yonge & Eglinton
  • Avani 2 at Metrogate, Kennedy & Hwy. 401
  • Selene at Metrogate, Kennedy & Hwy. 401
  • SQ2 at Alexandra Park, Spadina & Queen
  • FORM, Queen & McCaul
  • Scala, Leslie & Sheppard
  • Sherwood at Huntington, Bayview & Lawrence

Tridel.com

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Delays in approval process contributing to housing affordability issue in GTA

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Delays in approval process contributing to housing affordability issue in GTA

Approval web

The former Ontario government’s growth policies have had the unintended consequences of lengthening the land development and approval process in the Greater Toronto and Hamilton Area (GTHA), negatively impacting housing supply and affordability.

This is among the key findings in the Greater Toronto and Hamilton Area Land Supply Analysis from the Building Industry and Land Development Association (BILD) and Malone Given Parsons Ltd. (MGP).

“Growth policies implemented by the former provincial government from 2006 and 2017 have reduced the amount of available land for new housing communities, increased land prices and have caused home prices to skyrocket,” says Dave Wilkes, president and CEO, BILD, referring to the 2006 and 2017 Growth Plans.

Read more: 5 steps to solving the housing affordability issue in Ontario

Read more: Pent-up demand for townhomes building in the GTA

Read more: GTA new home market shows some improvement in September

“Land use in the province of Ontario is highly regulated  and the 2006 and 2017 Growth Plan changes have slowed down the approval process to bring new land on stream for new communities,” adds Matthew Corey, principal, MGP. “Increasing the supply of new land for housing is subject to a process that can take as long as a decade or more.”

The analysis is intended to provide an accurate accounting of greenfield land supply in the GTHA and Simcoe, to determine if the 2031 population and job forecasts of the Growth Plan will be achieved.

Key observations

  • The percentage of available land that has been approved for new housing communities in the GTHA is 4.5 per cent and decreasing.
  • Some municipalities in the GTHA have yet to conform to the 2006 Growth Plan requirements, missing the 2009 target by nearly a decade, resulting in less housing being built across GTA municipalities versus Growth Plan forecasts.
  • As land supply dwindles and as municipal delays increase, the value of serviced land has increased by more than 300 per cent since 2006.
  • Existing low density neighbourhoods in the GTHA are resistant to intensification, pushing density to urban cores and to new communities near the fringes of the GTHA. The latter are far away from transit and infrastructure, putting a greater reliance on cars and increasing traffic congestion.
  • More gentle density homes (stacked-townhouses and lowrise apartments) should be built within walking distance of transit in built-up areas of the GTHA. This will maximize investment in infrastructure and transit. However, community resistance to increased density makes building in this area time-consuming, expensive and subject to intervention at the municipal level.

Recommendations

BILD and Malone Given Parsons offer six recommendations to help solve the issues:

  1. Make more vacant land available for new communities
  2. Cut bureaucratic red tape and reduce duplication in the planning and approval process
  3. Avoid pushing too much density to fringe areas and away from transit and existing infrastructure
  4. Encourage moderate or gentle intensification across the region by clarifying and amending Growth Plan policies to encourage intensification across the GTHA
  5. Maximize investment in transit and infrastructure
  6. Provide greater certainty for future development by identifying the agricultural and rural lands in the inner-ring (Whitebelt) as future urban areas in the Growth Plan.

 

 

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Drive

Drive till you qualify? Sure, but it WILL cost you

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Drive till you qualify? Sure, but it WILL cost you

Drive

You may have heard the old real estate adage, “Drive till you qualify.” The idea being that buyers who can’t afford to buy a home in the city, should drive to surrounding areas to find more affordable and larger homes, with potentially more appealing lifestyle and environmental benefits.

At least that’s the idea.

In practice, however, such a plan may not be quite so simple. A new study from Canada Mortgage and Housing Corp. (CMHC) shows that increased commuting costs and time could offset any financial savings of buying a cheaper home in an outlying area.

“By assessing the combination of commuting costs and housing costs, one can gain a more comprehensive gauge of the total cost of location choices,” says Andrew Scott, senior analyst, economics, for CMHC.

Drive3
Source: CMHC

 

In 2016, there were approximately 2.6 million commuters in the GTA, with 1.3 million of them commuting to a place of work in the city of Toronto. This made it the most common destination for GTA commuters. Roughly two-thirds of these commuters lived within the cityitself, while the remaining commuted from the 905 areasof the GTA. Pickering had the highest share of people commuting into Toronto, at 52.6 per cent, followed by Ajax (48.4 per cent), Markham (46.9 per cent), Vaughan (40.8 per cent), Richmond Hill (39.1 per cent), Whitby (32.2 per cent) and Mississauga (26.7 per cent).

Most commuters to Toronto drove, at 49 per cent, while 40 per cent took public transit. Of 905 residents who commute into the city, 67 per cent drove a car, and 21 took public transport.

Areas with longest commutes

Average duration of commutes is clearly on the rise, CMHC says, particularly among those who commute 60 minutes or more, one way. Between 2011 and 2016, this was the fastest growing segment of the commuter population, growing by 16 per cent, followed by those who commuted 45 to 59 minutes (14 per cent). Areas with one-way commutes longer than 60 minutes include Aurora, Burlington, Milton, Newmarket, Oakville and Oshawa.

Lower home prices, increase commuting cost

The most likely home type to lure buyers to the suburbs is single-detached homes, CMHC says. However, when the estimated monthly mortgage carrying cost and monthly commuting cost are combined, relatively lower priced municipalities such as East Gwillimbury, Newmarket, Mississauga, Whitchurch-Stouffville and Caledon end up costing morethan or nearly as much as the city of Toronto.

Drive1

Notably, some GTA municipalities did retain their cost advantage. Even with significant commuting costs in areas such as Georgina, Oshawa and Clarington, a large cost advantage remains due to the considerably lower cost of housing.

Drive2

Based on estimates of the cost of commuting to Toronto from municipalities in the GTA, areas with lower mortgage carrying costs for single-detached housing often had significantly higher commuting costs, CMHC says. In many cases, these increased commuting costs completely offset lower home ownership costs.

Bottom line

The bottom line? Do all the math, and make sure that if you’re considering buying outside the city, your decision is based on more than money. The savings might not be there.

RELATED READING

Pent-up demand for townhomes building in the GTA

GTA new home market shows some improvement in September

5 affordable neighbourhoods for detached homes in 416 and 905

 

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Modern Condominium Living in the Best-Connected 905 Locations

Modern condominium living in the best-connected 905 locations

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Modern condominium living in the best-connected 905 locations

Pemberton Group strives to design in every community

Recognized for creating successful residential developments across the GTA’s most established neighbourhoods, Pemberton Group strives to design every community to reflect a higher quality of living, offering purchasers the opportunity to own a home surrounded by desirable features and exceptional amenities.

9th & Main offers luxury living in a ravine setting.
9th & Main offers luxury living in a ravine setting.

9th & Main Condos + Towns and GO.2 Condominiums offer two of the most livable and accessible locations in the 905. Those seeking a quieter lifestyle, away from the hustle and bustle of downtown Toronto, will appreciate not having to compromise on the modern conveniences associated with urban living.

Both 9th & Main and GO.2 present the best of both worlds, offering residents a range of local and onsite amenities like shopping and dining, as well as the tranquility of sprawling nature with nearby parks and trails just moments away.

9th & Main is located in the heart of Stouffville, the third fastest growing community in Canada, and is quickly transforming into a hub of contemporary living while managing to retain its traditional roots. Offering a connected way of life, residents will be just around the corner from restaurants, bistros, cafes, and boutique shopping along Main Street.

Enjoy outdoor living on the Terrace at GO.2.
Enjoy outdoor living on the Terrace at GO.2.

Stouffville is also a cultured community that is brimming with arts, sports, leisure and recreation facilities. The recently expanded Leisure Centre houses a library, fitness centre, indoor pool and gymnasium. Stouffville’s free public art gallery, the Latcham Art Centre, and The Lebovic Centre of Arts & Entertainment that hosts comedy shows, concerts, exhibits, theatre, film screenings and dance performances, are also close by.

Lush landscapes surround the Stouffville community from Musselman’s lake, Sunnyridge and Rupert Parks to several golf clubs within the vicinity, including Angus Glen and Spring Lakes.

Commuting is made easy with the Stouffville GO Transit Station and Highways 404 and 407 just minutes away, but residents don’t have to go farther than their front doors to enjoy themselves!

9th and Main’s onsite private amenities are aplenty including a gym, yoga-Pilates studio, men’s and women’s change rooms with steam rooms, theatre, library/lounge with fireplace, media lounge with gaming console, virtual golf, children’s play room, two boardrooms, two guest suites and a pet wash. Also included is a large party room with fireplace, bar, pool table, and caterer’s kitchen that opens onto a beautifully-landscaped outdoor terrace.

Comprised of two eight-storey condominiums and two-storey lofts and townhomes, 9th and Main’s suite configurations include one-bedroom, one-bedroom plus den, two-bedroom, two-bedroom plus den, three-bedroom and two-storey lofts in addition to two-bedroom townhomes. Prices start from the $400,000s to over $1 Million.

The Party Room at 9th & Main offers lounge seating, dining areas and access to the outdoor terrace.
The Party Room at 9th & Main offers lounge seating, dining areas and access to the outdoor terrace.

For a limited time, homebuyers can take advantage of a 10 per cent deposit program within six months. Please see a Sales Representative to find out more. Call 289.380.3451, visit online at PembertonGroup.com or come by the Presentation Centre, located at 11750 Ninth Line in Stouffville.

Also in the 905, is Pemberton’s GO.2 Condominiums. Situated in the Village of Maple at Major Mackenzie Drive and Dufferin Street, this centrally-located family-friendly community is ideal for modern urbanites desiring a neighbourhood with a rich history.

GO.2 is perfectly placed near schools, parks, shops and dining, offering residents immediate access to everything they need. For example, the nearby Vaughan Mills Premier Outlet Mall includes more than 200 fashion, dining and entertainment venues, and movie-lovers will appreciate being within close proximity to Colossus! Just minutes away is Canada’s Wonderland and local favourite, Zooland Indoor Play Centre.

Nature enthusiasts will be minutes away from local parks, including Civic Park, Freedom Trail Park and Jack Pine Park, which features the City’s first outdoor fitness equipment area.

Those seeking to take advantage of public transportation will be steps away from the Maple GO Station, and close to the GO Transit Barrie rail line, Go Transit buses, and York Region Transit. Highways 400 and 407 are also easily accessible to commuter residents.

The amenities at GO.2 are ideal for entertaining guests! These include a striking and welcoming lobby, fitness centre, an elegant party room with lounge seating and a spacious kitchen with dining areas, and an enviable outdoor rooftop terrace with beautiful landscaping, an outdoor fireplace and seating areas perfect for alfresco dining.

Available suites at GO.2 feature large two-bedroom and two-bedroom plus den layouts starting from $685,900 and the final remaining townhome is priced at $903,900, offering generous living space making them ideal for growing families. Call 905.553.1430 or visit the Presentation Centre, located at 1860 Major Mackenzie Drive West.

To discover more about Pemberton’s desirable 905 communities, register today at: pembertongroup.com. You can also follow Pemberton Group’s Facebook, Twitter, Instagram and YouTube accounts.


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Townhomes

Pent-up demand for townhomes building in the GTA

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Pent-up demand for townhomes building in the GTA

Townhomes

Condos may be the choice for many in the increasingly expensive GTA, but not everyone wants to live in a box in the sky. More and more new home buyers are looking for affordable lowrise options such as townhomes. Emphasis on the word affordable.

The problem? The supply just isn’t there – and the pent-up demand is growing.

Appealing especially to young families, townhomes provide more space and flexibility than condos, and generally are far more affordable than single-family homes.

“Both stacked (townhomes) and (row) townhouses form a key component of the Missing Middle – the built forms between high-density condo and low-density single-family housing,” Matthew Boukall, vice-president, product management, Data Solutions at Altus Group, told Homes Publishing.

Altus recently studied the sector for one of its regular housing reports, surmising that townhomes play an increasingly important role in in the new home sector, not just in the GTA but across Canada.

In the GTA, new townhouse sales have plummeted in the past two years – both in absolute terms and as a percentage of total new home sales (to just seven per cent of the total in the first half of 2018), Altus says.

GTA Starts

Affordability and availability remain an issue.

In the GTA, the key challenge to supplying this built form has been finding land with the right entitlements to allow and support this construction, Altus reports. Much of the land along Toronto streets support higher density condo product or is priced at a level which encourages rezoning to support this density.

“What can support more townhouse development is allowing rezoning of the land between the existing single-family communities and the corridors for more mid-density development,” Boukall says.

Although townhouse land (medium density) sales in 2017 were actually up over 2016, they are trending lower in 2018. Part of the problem is a lengthy approval process. “Year to date in Toronto, we have only tracked five approved townhouse projects, representing less than 350 units,” says Boukall. “Obviously, we need more product to meet the market demand. The positive note is that developers are proposing more product, with almost 1,500 new units applied for in 2018.”

GTA Townhouse sales

STACKED TOWNHOMES

Stacked townhouses, in which one row of townhouse units is stacked on top of another, provide a more affordable option to single-family homes, given higher densities. They also offer many of the appealing aspects of condominiums, but without living in a highrise environment.

However, they still play a relatively smaller role than traditional townhouses in the overall townhouse arena, Altus says.

In the Vancouver market, for example, new stacked townhouse units accounted for slightly more than 200 sales on average per year in 2015-17 – about six per cent of all new townhouse sales.

GTA Stacked

In the GTA, where stacked townhouses have made a larger dent, they remain a niche segment, accounting for about one in five new townhouse sales in recent years.

Part of the challenge with stacked townhouses versus rowhomes are those similar to condominium apartments – longer planning and construction timelines, and other residences adjacent on all sides

Both housing types will play an important role throughout the GTA in the future, but stacked townhouses are expected to become more popular given the better affordability provided by the higher density housing type.

“That said,” Boukall adds, “traditional row townhouses are the more common housing type in the GTA and as such, account for more sales compared to the stacked townhouse product. Row townhouse product has been accounting for a growing share of the single-family new homes sales in the GTA, currently accounting for 42 per cent of the total single-family sales activity in the GTA.”

WHERE IN THE GTA?

So, prospective GTA new home buyers, which areas hold the most promise in terms of future townhome availability?

While townhouses are expected to remain a popular housing option throughout the GTA, both Toronto and the York region share the most medium density land activity in the region, and should see increased development activity as a result in 2019 and beyond.

“The Peel region, most notably Brampton, is the most active for stacked and row townhouse sales in 2018 and should continue to see demand supported by an available land supply and comparably affordable prices,” says Boukall.

RELATED READING

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Vast majority of GTA Millennials fear buying a home is out of reach, poll says

7 factors that will affect GTA housing in 2019 – and 5 reasons to consider buying NOW

 

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