Photo: Alexandru Gogan
In The News
September 9-13, 2019
Toronto & GTA
It is definitely a landlord’s market out there. A lack of inventory continues to spread across primary and secondary rental markets with wait lists and bidding wars.
To activate development of 651 affordable housing units, the City of Toronto is offering to subsidize the constructions costs “to a tune of $12.3 million and offer another $38.3 million in incentives including waived development fees.
A recent report shows that Toronto Community Housing Corporation (TCHC) that outstanding arrears have increased 12.3 per cent over the twelve months ending in July 2019. With an average arrears of $3,640, the amount equates to nearly ten months of rent.
Canada Mortgage and Housing Corp reported that at 81,457 units, Ontario experienced the largest increase with seasonally adjusted starts. Multi-unit home starts in August led the way with strong pre-construction condominium apartment sales.
Developers are cutting back on the supply of pre-construction units by postponing launch dates to 2020 of a number of delayed projects. Competitively priced one-bedroom condos and supply below $1.5 million with an income-suite are the products moving quickly.
Nineteen per cent of millennials surveyed admitted to being dishonest on their credit loan application.
Despite a short-term oversupply of seniors housing in some market, Chartwell Retirement Residences (CSH-UN-T) has opened three properties this year with nine more upcoming developments to scale for future demand. In the first half of this year, Chartwell’s residences sat at a 90.2 per cent occupancy rate.
"Higher trending single-detached starts in urban centres in July and August following roughly a year of declines combined with higher-trending multi-family units in August to push the total starts trend to its highest level since June 2018,” according to CHMC’s chief economist, Bob Dugan.
Economist Michael Gregory argued that Canada will avoid a recession despite low productivity, global trade tensions, and high consumer debt. Historically low interest rates combined with a growing population and comparatively benign government debt that has Canada’s annual deficit at about six-tenths of one per cent of GDP.
Employment in the finance, insurance, real estate, rental and leasing industry grew by 22,000 in August, or 3.9 per cent. Ontario led the way in terms of job gains across the nation. Employment in Ontario increased 3.5 per cent year-over-year. Saskatchewan saw gains in various service-producing industries; Manitoba in professional, scientific, and technical services; Quebec in finance, insurance, real estate, leasing; and New Brunswick in information, culture, and recreation.
The US federal government is looking to reduce their exposure to the real estate market. It is argued that Fannie Mae and Freddie Max are severely undercapitalized and lending standards have deteriorated since the Great Recession.
Inventory across the US declined 1.8 per cent year-over-year in August. Price growth is slower than 2018; however, the median home list price increased 4.9 per cent.
More countries and territories are seeing price rises year-on-year than at any time in the last decade, but the average rate of growth is slowing significantly as global uncertainty continues.
Three years ago Canada held third spot and has now fallen to 49th out of 56 national housing markets included in the Knight Frank Global House Price Index, which ranks countries by annual home price changes each quarter.
Prices have risen 48% in five years and it now takes 21 years of an average household income to save to purchase a home. Less than a quarter of the territory is developed, with 40 per cent of it country parks or nature reserves. Land sales comprised 27% of government revenue in 2018 and the introduction of more government-subsidized apartments, is still not enough to keep pace with demand.