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GTA new home market understandably slow in April

GTA new home market understandably slow in April

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GTA new home market understandably slow in April

The GTA new home market saw record low new home sales numbers in April, according to the Building Industry and Land Development Association (BILD).

It was the lowest April for total new home sales, as well as single-family and condominium unit sales, since Altus Group, BILD’s official source for new home market intelligence, started tracking in 2000.

“As we expected, the April new home sales numbers reflect the impact of the COVID-19 pandemic on the GTA economy,” says David Wilkes, BILD president and CEO. “The good news is, the residential and commercial building and development industry, along with the professional renovations industry, is positioned to play a significant role in the recovery of our region and Ontario. In the coming weeks, we’ll be putting forward recommendations for all three levels of government that can accelerate the healing of our economy.”

A total of 771 new homes was sold in April, down 80 per cent from April 2019 and 78 per cent below the 10-year average. Single-family homes, including detached, linked and semi-detached houses and townhouses (excluding stacked townhouses), accounted for 301 new home sales, down 62 per cent from last April and 79 per cent below the 10-year average.

Sales of new condominium suites, including units in low-, medium- and highrise buildings, stacked townhouses and loft units, at 470 units sold, were down 85 per cent from April 2019 and 78 per cent below the 10-year average.

“The plunge in new home sales in April came as both builders and potential buyers stepped back from the heated activity of the first quarter, adjusting to the new reality ushered in by COVID-19,” says Patricia Arsenault, Altus Group’s executive vice-president, Data Solutions. “Most planned new project launches were put on hold, sales programs for existing projects moved to virtual or by-appointment-only models, and short-term homebuying plans were disrupted by employment uncertainty, as well as the challenges of stay-at-home routines.”

Benchmark prices for both new condominium apartments and new single-family homes increased slightly in April, compared to the previous month. The benchmark price for new condo units was $984,369, up 29.8 per cent over the last 12 months. The benchmark price for new single-family homes was $1.11 million, down 0.2 per cent over the last 12 months.


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New home sales centre app

Program helps builders get back to business safely after COVID-19

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Program helps builders get back to business safely after COVID-19

Toronto-based real estate marketing and advertising firm Ryan Design has created a customizable and innovative turnkey safety COVID-19 program for new-home builders.

New home sales centre app

When sales offices reopen, they will need to be ready to provide an environment that is safe for everyone and continues to prevent the spread of COVID-19.

A leading marketing firm serving numerous homebuilders across Canada, and trained by the World Health Organization (WHO), Ryan Design has created a complete COVID-19 safety program that is innovative and customizable to any builder.

As an essential service, homebuilders continue to build the homes people have been promised across the province. Using technology and an app, staff and trades workers on construction sites can help to ensure everyone’s safety.

Touchless job site sign-in portal

To keep everyone on the job site and in the community safe, Ryan Design has created a Touchless Job Site Sign-In and Sign-Out Portal. Tradespeople can now scan at arrival and departure and conduct health screening using an app on their phone.

A complete signage package for the app can been created for a builder’s job site. This part of the program also includes staff training and a complete reporting package for builders regarding trades on site.

Reopening sales centres and decor studios

When builders are allowed to reopen sales centres and design studios, these spaces will have to function differently and be safer for everybody, yet still be welcoming.

Another part of this new program for builders is a retrofit plan for existing sales offices. It includes easy installation of materials to add physical distance and innovative COVID-19 branded kits to help them feel safe and more comfortable in their homebuying journey.

COVID-19 changed the way sales consultants connect with prospective homebuyers and close a sale. Early on, Ryan Design developed a proprietary virtual selling system so that homebuilders could continue doing business. For many, this system has led to more new-home sales than anticipated after their sales office closure.

This customizable and innovative turnkey COVID-19 safety program for new-home builders by Ryan Design is a way to plan for a safe and secure reopening. With this program, both builders and homebuyers can feel safe and comfortable when it’s time to reopen.

ryan-design.com

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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.

RELATED READING

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

Outlook 2020 – 5 things you need to know about real estate this year

Get ready for a hot market in the GTA this spring

 

 

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Lindvest

Lindvest is doing it differently across the GTA

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Lindvest is doing it differently across the GTA

Take a minute to look through the advertising and marketing material of new home developments. How many have similar messaging, look and feel? Happy families, renderings of new homes, beautifully written taglines that use different variations of words such as “life” and “build.” What stands out to you? Probably nothing in particular. The homebuilding industry has a set of norms that companies very rarely step outside of.

At Lindvest, they have seen an opportunity arise out of all of the similarity – the opportunity to stand out, to emerge from the confines of the status quo and do something… different. With more than six decades of building experience, Lindvest’s aim has always been to remain as unique as the customers it serves. This trend will continue with the launch the new marketing campaign in early September.

Do it Differently. This new message, simple and yet provocative, will be seen across billboards, televisions and digital platforms throughout the GTA. This message will weave its way into the Lindvest branding, website, social media platforms and more. The goal is for the voice of Lindvest to stand out from the pack by breaking away from the standards of marketing in the industry. The public will encounter a tone that is as energetic, vibrant and charismatic as the people whose attention it is intended to capture. The imagery will focus on the bold personalities of the customers the company works and interacts with on a daily basis. Gone are the days of the message of blending in, sinking into the sea of similarity.

Do it Differently isn’t performative; it’s prescriptive. Lindvest doesn’t want to claim it’s different just for the sake of being different, but because the company knows that there are people out there who aspire to carve out their own unique path in life. The builder wants to provide a homebuying experience that is as unique and special as it should be. It’s about more than attempting to outperform competitors – the real goal is for the company to better itself. The message that lies deep within the core of this campaign will act as a driving force as Lindvest continues to push to provide a better overall experience for its customers. The message of Do it Differently won’t only represent the campaign and branding, but the company itself. It will become the golden thread that connects every aspect of Lindvest, from advertising to every member of its dedicated and enthusiastic team. This is a company that wants its customers to see and feel that everything is done with pride, consistency and energy – but above all – that Lindvest is doing it differently.

LINDVEST

You can get a sneak peek by visiting the website. Don’t forget to keep your eyes peeled for something different in September.


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GTA waterfront homes

Budget 2019 comes up short

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Budget 2019 comes up short

GTA waterfront homes

The federal government released the much-anticipated Budget 2019 this week, with homebuyers, builders and others awaiting measures to address housing issues.

And in short, it comes up, well… a little short.

First-time homebuyer help

Much of the housing focus in Budget 2019 was on addressing the needs of first-timers, namely with a new First-Time Home Buyer Incentive.

  • The Incentive would allow eligible first-time homebuyers who have the minimum down payment for an insured mortgage to apply to finance a portion of their home purchase through a shared equity mortgage with Canada Mortgage and Housing Corp. (CMHC).
  • About 100,000 first-time buyers would benefit from the Incentive over the next three years.
  • Since no ongoing payments would be required with the Incentive, Canadian families would have lower monthly mortgage payments. For example, if a borrower purchases a new $400,000 home with a five-per-cent down payment and a 10-per-cent CMHC shared equity mortgage ($40,000), the borrower’s total mortgage size would be reduced from $380,000 to $340,000, reducing the borrower’s monthly mortgage costs by as much as $228 per month.
  • CMHC to offer qualified first-time homebuyers a 10-per-cent shared equity mortgage for a newly constructed home or a five-per-cent shared equity mortgage for an existing home. This larger shared equity mortgage for newly constructed homes could help encourage the home construction needed to address some of the housing supply shortages in Canada, particularly in the largest cities.
  • The First-Time Home Buyer Incentive would include eligibility criteria to ensure that the program helps those with legitimate needs, while ensuring that participants are able to afford the homes they purchase. The Incentive would be available to first-time buyers with household incomes of less than $120,000 per year.
  • Budget 2019 also proposes to increase the Home Buyers’ Plan withdrawal limit from $25,000 to $35,000, providing first-time buyers with greater access to their Registered Retirement Savings Plan savings to buy a home.

Noticeably absent from the housing measures was any adjustment to the stress test, which a number of experts say is necessary.

Industry reaction

“The Building Industry and Land Development Association (BILD) agrees with (Federal Finance Minister Bill Morneau’s) comments that there aren’t enough homes for people to buy or apartments for people to rent,” says Dave Wilkes, president and CEO.

“BILD feels the policies presented in (the) budget are a step in the right direction to help first-time homebuyers. We will continue to advocate for a review of the stress test so that first-time homebuyers can realize the dream of homeownership. Supply challenges still exist and are at the centre of the current unbalanced market, and we call for action on these by the provincial and municipal government.”

Supply challenges in the Greater Golden Horseshoe are serious, and Budget 19 fails to address them.

“This was a re-election budget that didn’t move the dial for new-home buyers in the GTA,” Richard Lyall, president of the Residential Construction Council of Ontario (RESCON) told HOMES Publishing. “While increasing RRSP borrowing for first-time homebuyers is helpful, creating The First-Time Homebuyer Incentive at a maximum of $500,000 doesn’t help many Torontonians or GTA residents.”

The Canadian Home Builders’ Association (CHBA) had been recommending a shared appreciation mortgage approach for some time, as a tool to help those who can’t get into homeownership but have the means to pay rent.

The modification to the RRSP Home Buyers’ Plan will help get Canadians into their first home, but will also act as a burden because the loan has to be repaid within 15 years, including a minimum of 1/15th per year.

“This means that, in the years following their home purchase, a homeowner has the additional financial responsibility of repaying their RRSP,” says James Laird, co-founder of Ratehub Inc. and president of CanWise Financial.

Important details of the First-Time Home Buyer Incentive program have yet to be released. For example, says Laird, it remains unclear whether the government would take an equity position in homes, or whether the assistance would act as an interest-free loan.

“This is an important distinction because if the government is taking an equity stake in a home, the amount the homeowner would have to pay back would grow as the value of the home increases,” he says.

The very launch of the program is surprising, Laird says, given that the BC Government implemented a similar measure a couple years ago, with unsuccessful results, and it was terminated in 2018. First-time home buyers found it difficult to understand and unappealing to have the government co-own their home.

Let’s do the math

Under existing qualifying criteria, including the stress test, homebuyers can qualify for a house that is 4.5 to 4.7 times their household income.

Under the new First-Time Home Buyer Incentive, however, the government has set a purchase limit of four times household income for the mortgage, plus the amount provided by the government, according to Ratehub.

By participating in this program, first-time homebuyers effectively reduce the amount they can qualify for by about 15 per cent, and their monthly mortgage payment naturally decreases in lockstep.

A household with $100,000 of income, putting a minimum down payment of five per cent, can currently qualify for a home valued at $479,888 with a $2,265.75 monthly mortgage payment.

Affordability calculations

The maximum purchase price for the same household, if they participate in the first-time homebuyer incentive, drops to $404,858.29 with a five-per-cent minimum down payment. The total mortgage amount would then be $400,000 (or four times their household income).

Mortgage payment calculations

If the household took a five-per-cent incentive from the government (for resales), their mortgage amount goes to $378,947.37, and monthly payment is now $1,810.90.

If the household took a 10-per-cent incentive, (for new homes) their mortgage amount goes to $357,894.73, and  monthly payment is now $1,710.29.

Stress test modifications

The CHBA is among the industry groups that is pushing for modifications to the existing mortgage stress test, which has served to lock out too many well-qualified Canadians due to the market and interest rate changes of the past year.

“The First-Time Home Buyer Incentive, if coupled with immediate adjustments to the stress test, has the potential for getting the housing continuum functioning again,” says CHBA CEO Kevin Lee. “It is essential that these changes come quickly, though. Current restrictions on mortgage access mean that many millennials and new Canadians are seeing homeownership slipping away, and in many markets the economic impacts are substantial.”

Looking ahead to the 2019 federal election, CHBA will be encouraging all federal parties to address housing affordability in very meaningful ways in their respective platform documents.

Budget 2019 housing measures

Budget 2019

 

 

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GTA new home sales

GTA new home sales begin 2019 on a positive note

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GTA new home sales begin 2019 on a positive note

GTA new home sales

Sales of new homes in the GTA in January showed a moderate increase from last year, the Building Industry and Land Development Association (BILD) reports.

A total of 1,362 new homes were sold in January 2019, up 14 per cent from those sold in January of last year, according to Altus Group, BILD’s official source for new home market intelligence.

Encouraging start

“I wouldn’t necessarily call this a strong start to the year,” David Wilkes, BILD president and CEO, told HOMES Publishing. “Yes, January is historically a slow month for new home sales, and we are encouraged by the modest improvement from January 2019 over 2018. However, low new home sales numbers continue to indicate that more needs to be done to make homeownership easier for new homebuyers.”

January’s sales of new single-family homes, including detached, linked and semi-detached houses and townhouses (excluding stacked townhouses),with 420 single-family homes sold, were still low from a historical perspective, down 53 per cent from the 10-year average. Sales of new condominiums, including units in low-, medium- and highrise buildings, stacked townhouses and loft units,were only five per cent lower than the 10-year average, with 942 units sold.

Brighter outlook

“This year is starting off on a positive note,” says Patricia Arsenault, Altus Group’s executive vice-president, Data Solutions. “The improvement in new home sales over last January is consistent with our outlook for somewhat higher annual sales in the GTA this year, following the drop in 2018.”

Benchmark prices of new homes continued recent trends, with the benchmark price of single-family homes moderating slightly to $1.13 million in January from December 2018, down 8.1 per cent over the last 12 months. The condo benchmark price increased from last month to $803,638, up 12.5 per cent over the last 12 months.

With little new product coming into the housing market in January, remaining inventory decreased slightly from last month, to 15,530 units comprised of 10,364 condo units and 5,166 single-family homes. Remaining inventory includes units in preconstruction projects, in projects currently under construction and in completed buildings.

Government needs to act

“It looks like the market is starting to return to typical levels after a particularly difficult year,” adds Wilkes. “With the spring budget coming up, we are calling on the federal government to take steps to make it easier for first-time home buyers to get into the housing market.”

Wilkes says the federal government should look at reintroducing the 30-year amortization periods for first-time buyers and adjusting the stress test, now that interest rates have risen.

“We must also continue to look at ways to increase supply,” he told HOMES. “We continue to call on municipal and provincial governments to remove barriers to bringing new housing and employment lands to market to meet the demand for much needed places to live and work across the GTA.”

 

January new home sales by municipality

Region Condominium units Single-family Total
2019 2018 2017 2019 2018 2017 2019 2018 2017
Durham 30 13 28 46 82 190 76 95 218
Halton 29 38 112 231 172 154 260 210 266
Peel 105 86 203 77 30 211 182 116 414
Toronto 724 605 982 5 8 36 729 613 1018
York 54 83 319 61 81 170 115 164 489
GTA 942 825 1,644 420 373 761 1,362 1,198 2,405

Source: Altus Group

RELATED READING

GTA homebuyers continue to look west in search of affordability

Behind the numbers , A deeper look into the 2018 GTA housing market

2018 GTA new home sales drop to lowest mark in nearly 20 years

Three opportunities to positively impact housing in 2019

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New home market

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

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

New home market

The GTA new home market saw more typical activity levels in November, both in new home sales and new project openings, after a relatively strong October, the Building Industry and Land Development Association (BILD) reports.

There were 2,823 new homes sold in November, according to Altus Group, BILD’s official source for new-home market intelligence. Condominium apartments in low-, medium- and highrise buildings, stacked townhouses and loft units accounted for 2,454 new home sales in November, down 24 per cent from November 2017, but only sixper cent less than the 10-year average. Single-family home sales, with 369 detached, linked and semi-detached houses and townhouses (excluding stacked townhouses) sold, were up eight per cent from last November but down 71 per cent from the 10-year average.

Remaining inventory increased month over month, to 16,797 units, comprised of 11,254 condo apartment units and 5,543 single-family units. Remaining inventory includes units in preconstruction projects, in projects currently under construction, and in completed buildings.

Strong finish

“The condominium apartment market in the GTA is finishing off the year on a stronger note than it started,” says Patricia Arsenault, Altus Group’s executive vice-president, Data Solutions. “Both builders and buyers have re-engaged in stronger numbers in recent months, signalling that the downturn that followed record activity last year may be coming to an end.”

The benchmark price for both condo apartments and single-family homes increased slightly in November compared to the previous month. The benchmark price for condo apartments was $786,602, which was up 11.9 per cent over the last 12 months. The benchmark price for single-family homes was $1,150,823, down 5.9 per cent over the last 12 months.

Although the housing market continued to show signs of recovery in November, it will continue to operate below capacity until fundamental issues that are restricting supply and demand are addressed through government policy, according to David Wilkes, BILD president and CEO.

No more talk

“The time for talk is done and our region needs action now to ensure we build the more than 50,000 new homes needed annually to support the GTA’s growing population,” says Wilkes. “Our industry is encouraged by the provincial government’s commitment to unlocking supply. We will continue to call on municipal governments to expedite approvals of new developments, and on the federal government to undo the negative effects of the outdated stress test on consumers’ ability to purchase homes.”

 

November new home sales by municipality

November 2018 Condominium Apartments Single-Family Total
Region 2018 2017 2016 2018 2017 2016 2018 2017 2016
Durham 404 16 57 54 75 171 458 91 228
Halton 101 204 114 107 88 415 208 292 529
Peel 736 181 231 52 61 132 788 242 363
Toronto 1,124 2,425 2,678 17 21 110 1,141 2,446 2,788
York 89 387 317 139 97 837 228 484 1,154
GTA 2,454 3,213 3,397 369 342 1,665 2,823 3,555 5,062

 Source: Altus Group

RELATED READING

GTA new home market gains further momentum in October

GTA moving into balanced market for 2019

GTA new home market shows some improvement in September

 

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EDITOR'S CHOICE: Podium Developments

New home buying opportunities abound in Oshawa and Durham Region

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New home buying opportunities abound in Oshawa and Durham Region

EDITOR'S CHOICE: Podium Developments
Ironwood Towns in North Oshawa by Podium Developments and Urban Capital

Despite the bad news this week that General Motors Canada plans to close assembly operations in Oshawa, there are some good new home buying opportunities in the city and elsewhere in Durham Region.

As various levels of government and the Unifor trade union vow to somehow keep the plant open or otherwise deal with the fallout of the decision, the housing sector in Oshawa is expected to shift into a buyers’ market.

That could mean deals for buyers in a market where home prices have already been under pressure.

 

Also read: What the GM plant closure means for Oshawa economy and housing

Also read: Oshawa housing to move into buyers’ market thanks to GM closure

 

For those looking to buy a new home, know that there are still plenty of good opportunities in Oshawa and surrounding area.

First, let’s look at recent new home buying activity in the area, courtesy of statistics from Altus Group, theofficial source for market intelligence for the Building Industry and Land Development Association (BILD).

 

Total new home sales, units

Oshawa Durham Region
Annual
2013          682       2,376
2014       1,108       3,130
2015          971       3,433
2016       1,149       5,344
2017          490       2,385
Jan-Oct
2017          483       2,262
2018            83       1,065
Source:  Altus Group

 

Naturally, the GM news is a sensitive topic to an industry such as home building, where companies dedicate years to planning and construction development projects. So don’t expect a comment any time soon from BILD, the voice of home builders in the GTA, or individual companies.

Might developers at some point offer deals – be they discounts or upgrades – in order to move an unsold inventory in a market not feeling the strongest at the moment?

It never hurts to ask.

 

A selection of new home and condo inventory

Ironwood in North Oshawa, Building Capital and Podium Developments, contemporary freehold townhomes

Harmony Creek, Conservatory Group, townhomes and detached homes

Brook Phase 2, Delpark Homes, detached homes

Fields of Harmony Phase IV, Greycrest Homes, detached homes

Kingsview Ridge, Treasure Hill, 30-, 36- and 40-ft. singles

Park Ridge, Tribute Communities, detached homes from the low $900’s

U.C. Towns 2, Tribute Communities, townhomes form the low $600’s

Top of Townline, Woodland Homes, detached homes

For more new home buying opportunities, visit MyHomePage.ca

With files from Natalie Sicilia, New Home Research Manager & Map Editor

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House web

Oshawa housing to move into buyers’ market thanks to GM closure

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Oshawa housing to move into buyers’ market thanks to GM closure

House web

In one fell swoop, General Motors Canada’s announcement on Nov. 25 that it plans to close all assembly operations in Oshawa, Ont. effectively has pushed housing there into a buyers’ market.

“The announced General Motors plant closure will certainly impact Oshawa, and the trickle-down effect will be felt across the province,” Christopher Alexander, executive vice-president and regional director, ReMax Integra of Ontario-Atlantic Region, told Homes Publishing.

“However, it’s important to remember that GM isn’t the economic driver that it used to be in Durham Region. The area boasts a growing education sector and a new casino is slated to open in 2019, which will boost new condo development and housing demand. With the rise of remote work and no relief expected for Toronto house prices in 2019, Oshawa will continue to be a popular choice with first-time and move-up buyers who have been priced out of the 416.”

There you have it, prospective home buyers.

Opportunity knocks

While such a major employment hit is hardly an occasion to celebrate, these developments could mean opportunity for those looking to buy a home.

“The fact is that more than 2,500 GM workers will be left in the lurch come 2020, and the looming loss of income will likely prompt a softening of the market at a local level, as existing residents and prospective homebuyers digest the news and what it might mean for them,” says Alexander. “This coming closure, coupled with further interest rate increases in 2019, is likely to trigger a market shift from the current balanced territory, as homebuyers delay purchases, scale down lower-priced properties or move away in search of employment.”

Also read: What the GM plant closure means for Oshawa economy and housing

Also read: Focus on Whitby and Oshawa

Another real estate expert, Don R. Campbell, says the impact of the closure could take 18 to 24 months to play out fully in the region.

Diversified economy

Thankfully, there is more going for Oshawa and the Durham Region than just General Motors. Though it was once described as the “Automotive Capital of Canada,” in recent years the economy has diversified into education and health sciences. The University of Ontario Institute of Technology, Durham College and Trent University Durham and all have campuses in the city, among other economy-boosting facilities.

Indeed, in its latest Metropolitan Outlook, the Conference Board of Canada pegged Oshawa to be one of the strongest economies in the province for 2018. The Board forecast real GDP growth of 2.6 per cent this year, following 3.2 per cent in the last two years, citing strength in the non-residential construction, education, health care, finance and insurance sectors.

In addition, Statistics Canada figures show that Oshawa was one of the fastest growing cities in Ontario from 2011 to 2016, with 6.6 per cent population growth, second only to Guelph at 7.7 per cent. This, after growing 7.7 per cent from 2006 to 2011.

Importantly, for prospective home buyers, transportation improvements such as expanded GO Transit and the Hwy. 407 extension make it easier for people to live in Oshawa – at cheaper home prices – and commute to work in other areas such as Toronto. Another extension of the 407 eastward to neighbouring Clarington is due for 2020, further easing transportation options.

New home opportunities

Tomorrow, we’ll explore some of the opportunities to buy new homes in the Durham Region.

 

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Toronto fall web

Higher Toronto Development Charges kick in Nov. 1

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Higher Toronto Development Charges kick in Nov. 1

Toronto fall web

By Wayne Karl

It’s Nov. 1, prospective homebuyers in Toronto, and if you’re looking to buy a new home, the price of your property just went up – thanks to the City’s new Development Charges.

And trust us, homeowners and buyers, the numbers are frightening. Increasingly so.

Just what are Development Charges (DCs)? Those are the fees, levies and other costs municipalities add to development projects. Amounting to tens of thousands of dollars per condo unit or lowrise home, these fees go towards paying for transit and road infrastructure, community services such as parks and recreation and police and fire services, and other items.

And most of those costs, dear homebuyer, are passed on to you. Meaning, they impact the amount of income you have available to pay your mortgage.

Not just that, many believe that new-home buyers end up paying a disproportionate amount for new amenities and services that are enjoyed by the wider community.

Just how much are we talking about here?

(The explanation is kind of complicated and even a bit of an eye-glazer, but stay with us – it’s worth it.)

DCs comprise from 23 to 45 per cent (the largest component) of the government charges on new homes, according to a recent study by Altus Group, commissioned by the Building Industry and Land Development Association (BILD). Since 2004, development charges have increased between 236 and 878 per cent.

  • The average government charges for each new single‐detached home are roughly $186,300, or roughly 21.7 per cent of the average price for a new home. Charges per home range from $120,000 in the Town of Bradford West Gwillimbury to $232,500 in the Town of Oakville.
  • For a new condominium, the average government charges per apartment are approximately $122,800, or roughly 23.9 per cent of the average price for a new condominium apartment. Charges per condominium range from $68,800 in the Town of Bradford West Gwillimbury to $164,500 in the City of Toronto.

RISING HOME PRICES

Further impacting costs for homebuyers is rising home prices, driven by economic and market factors. Over the 2009‐17 period, the average price of lowrise homes in the GTA increased 167 per cent, while for highrise units the figure grew by 80 per cent, according to Altus Group.

DCs by municipality, per single-detached home

  • Town of Ajax/Durham Region: $44,447
  • Town of Oakville/Halton Region: $73,965
  • City of Brampton/Peel Region: $81,825
  • City of Markham/York Region: $82,017
  • Town of Bradford West Gwillimbury/Simcoe County: $34,08
  • City of Toronto: Currently $41,251

For Toronto, the City is in the midst of a DC increase to $80,227 per unit, to take full effect in November 2020. Fifty per cent of the increase takes place in November 2018, and by November 2019 80 per cent of the increase is to be implemented.

Here’s what’s happening for Toronto, select property types, per unit

Property Type                            As of May 1, 2018           Effective Nov. 1, 2018
Singles and semis                              $41,251                                    $60,73
Multiples, 2-plus bedrooms              $34,742                                    $50,528
Condos, 2-plus bedrooms                 $25,366.                                   $36,165
Condos, 1-bedroom & bachelors     $17,644                                    $24,150

So, Torontonians, get used to Nov. 1 being a day not exactly worth celebrating.

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