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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 12, 2019 99   0   0   0   0   0
Bureaucratic roadblocks continue to have a major influence on Metro Vancouver’s housing supply, as these intricacies have led to massively overdue project approvals, according to the recently released Market Intel real estate report by MLA Canada. Burnaby, Vancouver, and the District of North Vancouver are the areas hit the hardest by these delays, with development approval timelines being among the longest (at nearly 2 years) in the region. In addition, construction costs have increased by almost 50% on average over the past 5 years.This burden is almost always absorbed by the end consumer, the MLA study noted. “2019 is expected to be highly competitive, but an overall balanced market with nominal price escalation will provide purchasers with choice and value,” MLA Canada chief advisory officer and partner Suzana Goncalves said. Read more:Vancouver’s empty homes tax visibly improved vacancy rates, supply[1] One bit of good news is an increased volume of new stock incoming.MLA Intel is expecting 13,975 pre-sale units to be released this year, considerably above the 11,584 in 2018. However, the study quickly added that B.C.’s population will experience consistent growth for the next several years, with roughly 50,000 new residents in 2019 alone. “With job opportunities remaining high compared to other provinces, interprovincial migration will
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 12, 2019 141   0   0   0   0   0
A modest pace of sales characterized Regina as of the beginning of 2019, although the city remains predominantly a buyers’ market. New numbers from the Association of Regina Realtors indicated that during the first month of the year, sales grew by 1.2% annually.The total volume actually ended noticeably above the 5-year average, however. “The number of sales that took place in January exceeded our expectations,” Association CEO Gord Archibald said, as quoted by CTV News. The Canada Mortgage and Housing Corporation’s latest report categorized Regina as a buyers’ market, with a moderate level of vulnerability. “In Regina we’ve continued to see slower demand for housing units whether it in the resale or new home market,” according to CMHC senior market analyst Goodson Mwale. Read more:Saskatchewan affordable housing gets multi-million-dollar tranche[1] “We’ve continued to see elevated supply and that has continued to put downward pressure on prices.Both in Regina and in Saskatoon we’re seeing a buyers’ market conditions persist over the past several quarters.” As of the fourth quarter of 2018, Regina’s supply exhibited considerable abundance, which the CMHC attributed to overbuilding during the past few years.This has also led to vacancy levels seeing a marked increase, from 7% in 2017 up to the 7.7% rate in 2018.  
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 10, 2019 172   0   0   0   0   0
Homeownership is becoming increasingly difficult to attain in Calgary, but the city’s rental market is on fire. In fact, the vacancy rate in the Calgary rental market decreased from 6.3% in 2017 to 3.9% last year. “The way this is connected to the rental market is a function of these affordability challenges we’re seeing in the market, and given the pressures put on an individual’s affordability—and we know interest rates are higher—they are renting longer,” said James Cuddy, a senior analyst with the Canada Mortgage and Housing Corporation. Another reason for the buoyant rental market is that interprovincial migration was positive through the first three quarters of 2018—a stark contrast to the previous 2.5 years of negative growth—and that has also done its part to push the vacancy rate down. “We’ve also seen some steady growth in terms of international migration, so it’s contributing to higher demand for rentals in Calgary,” added Cuddy. The outlook for ownership, according to CMHC, isn’t as rosy.Inventory levels are high in the city and builders have started scaling back production.One reason for languid sales is high unemployment and low disposable income. “The general economic recovery we’ve seen since the last recession has been relatively slow;unemployment rates remain elevated and a lack of personal growth in
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 10, 2019 109   0   0   0   0   0
The value of Montreal’s residential property is seeing sustained growth thanks to a booming economy attracting hopeful home buyers from all over Canada, according to the latest figures from the Quebec Professional Association of Real Estate Brokers (QPAREB) The market’s benchmark price for single-family homes increased by 3% year-over-year in January, reaching $316,000.Meanwhile, condos had 2% growth to arrive at $248,271.Plexes had a 4% rise during the same period, settling at $515,000. The numbers supported the observations of professional services firm Shupilov Real Estate, which reported recently that Montreal has become a highly sought after sellers’ market.Aside from the price growth, galvanized competition was a significant factor that drove sales. Read more:Montreal leads country’s metro areas in price growth[1] “This is especially true in the single family home segment, where bidding wars are increasingly common and offers are more likely to be accepted above the original asking price,” Shupilov’s analysis explained. This level of demand has steadily eaten up the market’s inventory, with the number of active residential listings in the CMA falling by 16% year-over-year last month (down to 20,873 properties for sale). Montreal’s sales enjoyed its 47th straight month of sales growth in January, with activity increasing by 15% annually, the QPAREB added. This is despite plexes
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 10, 2019 109   0   0   0   0   0
The ratio of unoccupied residential properties in Vancouver noticeably fell by 15% in just one year, and half of previously empty homes have been moved to the rental market, according to the initial returns of the city’s 2018 empty homes tax. The Vancouver government stated that these figures point to the effectiveness of the levy, with a tangible impact on both vacancy rates and rental supply. Overall, the number of the city’s vacant homes went down from 1,085 homes in 2017, to just 922 in 2018. However, a markets observer warned that it might be too early to celebrate the empty homes tax as a victory, since Vancouver is not yet seeing an equitable distribution of relief. Andy Yan, the director of the City Program at Simon Fraser University, cautioned late last year that price declines have taken place only in the top tier of the market, while the middle and lower price brackets remained all but unchanged. Read more:Federal gov’t should do more to address shortages – mayors[1] “The softening of the market and cooling of the market is something that is definitely happening,” Yan admitted, but quickly added that it’s “a little bit premature to know whether the policies are a success or failure.”
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 07, 2019 174   0   0   0   0   0
What if condo investing were as easy as owning a mutual fund?Well, it can be. Connect Asset Management will be at the Investor Forum on March 2[1] to explain how it helps its clients turn one property into several and build portfolios that cash flow millions of dollars.One of the ways in which Connect Asset Management does that is by helping investor clients access to some of the most exclusive real estate developments in Ontario. “We help investors plan, invest and retire wealthy with cash flow in condos,” said real estate broker and founder of Connect Asset Management Ryan Coyle.“It’s completely hands-off for our clients;we make investing in real estate as easy as owning a mutual fund.” Connect Asset Management builds a strategy for its clients predicated on timing—that is, strategically choosing when to purchase a property. “From acquisition to completion, there’s a tremendous amount of growth on capital appreciation and rental appreciation, so when the condo is built they have all this appreciation that gives them the ability to refinance, pull out the equity and buy more property,” said Coyle.“We help our clients identify the optimal time to flow that capital into more properties.” The strategy, which Connect Asset Management will decode at the Investor Forum, is called
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 07, 2019 124   0   0   0   0   0
After a tumultuous 2018, the Toronto residential market is expected to encounter notable improvements in activity and housing value this year, according to the Toronto Real Estate Board’s 4th annual Market Year in Review and Outlook report. “Although we won’t experience record levels, we do expect to see a better year in 2019 for sales and selling prices,” TREB president Garry Bhaura stated. A large part of the predicted upticks will stem from the increased number of consumers intending to buy homes in Toronto. “Many buyers who moved to the sidelines over the past year due to various government policies, including the OSFI-mandated mortgage stress test, have re-evaluated their positioning in the marketplace vis-à-vis home type, location and price point,” Bhaura noted. Total sales volume is forecast to increase from last year’s 77,375 transactions to 83,000 deals completed in 2019.Aside from increased home-buying intentions, the growth will also be impelled by healthy employment numbers, lower average fixed-rate borrowing costs, and sustained population growth. Read more:Toronto’s condo market can expect much volatility this year[1] Prices are predicted to continue the moderate growth trend established in the second half of 2018, the TREB said.The median sales price in the GTA will reach $820,000, up from the average of $787,195 in 2018 and
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 07, 2019 132   0   0   0   0   0
Intensified demand brought about by an influx of tech companies has pushed Toronto’s office market towards becoming one of Canada’s premier investment destinations, according to a CBRE Group report. The vacancy rate of the office sector fell to 2.7% during the fourth quarter of 2018, leading to commercial rental rates reaching an average of $35.37 per square foot. This far outstripped Montreal’s figures, which posted a median rental rate of $22.76/sf on a 9.4% vacancy rate during the same quarter.And Vancouver, while having a higher average at $37.20/sf, did not command the level of Toronto’s demand, with a 3.8% vacancy. Even intensified development offered only the most minimal of respites for the overheated market.As of the end of 2018, approximately 14.2 million square feet of new commercial space was under construction nationwide, with most of this situated in Toronto, Vancouver, and Montreal. This was the strongest development activity since the first quarter of 2016, the CBRE noted. Read more:Canadian commercial investment to intensify this year[1] CBRE added that despite the 7.3 million sf of space still under development in Toronto, “chronic shortage” will continue to characterize the market for the foreseeable future. For perspective, this greatly exceeds Vancouver’s 2.86 million sf and Montreal’s 954,510 sf.This also continues the
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 05, 2019 127   0   0   0   0   0
The real estate investing gurus behind Keyspire are coming to a city near you. Michael Sarracini and his partner Scott McGillivray—who’s also the star of Income Property on HGTV, a hit television show in 43 countries—are touring the country[1] to teach both seasoned and neophyte investors the ins and outs of the business with information sessions and workshops. According to Sarracini, Keyspire’s CEO, at the two-hour and three-day in-depth workshops, the tenets of Information Education Implementation—the same technique used on Income Property—will be imparted. The first tenet is about active and passive income.Instead of merely buying to flip, investors are encouraged to build a strategy and then a portfolio.Active income is the process whereby a property is flipped or used as a rent-to-own, but passive income is the turnkey rental property that’s buoyed by a plan to support the investor’s lifestyle. That’s supported by what Keyspire refers to as tools and techniques, one of which is called Flipping to Yourself—a staple strategy on Income Property that McGillivray and Sarracini implemented while the latter worked as a project manager during the show’s first two seasons. “We do rentals and we do them right,” said Sarracini.“When we realized that flipping wasn’t for us, and not the same in Canada as it is in
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 05, 2019 143   0   0   0   0   0
Much attention has been devoted to the feverish pace of housing construction nationwide, although whether this has successfully addressed the problem of supply remains an open question. However, a recent study published by the Housing Policy Debate journal argued that these inventory injections have in the past few years tended towards being valued at market prices, a fact that will still exclude a considerable number of would-be buyers. The report stressed that governments at all levels should “ensure that supply is added at prices affordable to a range of incomes.” “The challenge in housing affordability is to ensure that new housing is built to meet the shelter needs across the income spectrum and not just for high-income earners.It is true that even housing built to draw market prices and rents over time, through market filtering, will improve affordability for low-income earners.However, the filtering process takes time.” Read more:The waning of Vancouver and the waxing of Toronto[1] A recent heavy influx of asylum-seekers has only complicated matters.In late January, Canadian mayors urged the federal government to do its part in addressing the supply shortages brought about by this immigration volume, as the problem exceeds the capabilities of just the municipal or provincial levels. “[The federal government] makes the
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 05, 2019 154   0   0   0   0   0
Latest numbers from the Canadian Real Estate Association showed that home price growth in Ottawa stood at a robust 15% average from 2016 to 2018. This translated to a $56,300 increase in the average home price during the time frame, reaching $433,500 as of December 2018. The trend also represented a considerably accelerated pace from 2016, as the gain from December 2013 to December 2018 was around $82,000, the Ottawa Citizen reported. Much of this can be attributed to the market’s relatively high average income, which pushed the city towards becoming one of Canada’s most active sellers’ markets last year. Read more:Asset management firm closes $186-million transaction in Ottawa[1] “Homes that come on the market are quickly sold, with multiple offer situations often present,” according to John Rogan, broker of record and branch manager of Royal LePage Performance Realty. “Overall, healthy employment and wages are propelling higher housing demand in the region.This increasing demand, coupled with Baby Boomers remaining in their homes longer than previously expected, is putting pressure on all housing types and fueling price appreciation.” As of Q4 2018, Ottawa’s aggregate housing price in the city went up by 9.3% year-over-year to reach reached $475,831. CREA’s figures indicated that Ottawa’s pace was noticeably greater
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 03, 2019 162   0   0   0   0   0
Several pressures have led Toronto’s condo market to a hotbed of volatility, if new data from the Altus Group is any indication. Transactions in the asset class fell by 38% year-over-year to reach 21,330 sales.Although the total number was only 4% below the 10-year average, another report by Urbanation pointed to more potential issues ahead, with supply-side problems taking center stage. “The slowdown in activity last year can partly be attributed to less demand from investors, who typically represent the largest component of new condominium purchasers [in Toronto],” Urbanation noted. The market insights firm emphasized that competition for condos will be intense, as 98% of new units are already pre-sold, and more than half of the new supply has been purchased for investment purposes. Urbanation stated that the total number of condos scheduled for completion this year is 21,991 units, representing a record high.This will also be 29% greater than 2018’s completions. Read more:Federal gov’t should do more to address shortages – mayors[1] Toronto’s single-family properties, on the other hand, experienced a significant 50% year-over-year fall in sales activity, down to 3,831 transactions – fully 74% lower than the 10-year average. “Real estate investment in general had a bit of a quieter year after an exceptional 2017,” Altus
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing February 03, 2019 213   0   0   0   0   0
As every landlord surely knows, running a credit check during the tenant selection process is paramount.However, not every landlord realizes what to do with the information the credit check reveals. “Every independent landlord knows that to screen a tenant, you have to look at their credit, but a lot of them have no idea how credit relates to a tenant’s ability to pay rent on time,” said Jerome Werniuk, director of sales at Naborly Inc[1]., which runs free credit and background checks.“Ninety-five percent of landlords have tenants show up with their own credit file, meaning they go to Credit Karma or Equifax, but when we hear professional tenant stories, these people come with doctored credit checks. Doctoring a credit check is as easy as finding a template online and filling it in as one wishes.It’s what Werniuk describes as a huge problem within the industry. While savvy landlords realize they can obtain credit checks from Equifax or TransUnion, many still don’t know, nor have time, to mine the information therein to decipher a tenant’s capacity for prompt rent payments. “To get a credit file from either of the credit bureaus, they have to pay for it and a set-up fee for the individual’s report, but there’s a heavy credentialing process
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing January 31, 2019 200   0   0   0   0   0
Rising interest rates and strict mortgage qualification resulted in fewer Canadians seeking homeownership than rental accommodations last year, and 2019 will bring more of the same. “It’s going to continue,” said Marcus &Millichap’s Vice President and Broker of Record Mark Paterson.“People will continue renting rather than dealing with residential mortgages.The rental market right now can barely keep up with the vacancy rate in Toronto, for example, being around 1%.” Competition for rentals will be even fiercer this year in urban centres and that will push rents upward, creating a spillover effect into satellite markets. “The rental market will see an increase of 8-10% because of demand,” said Paterson.“Unfortunately for people trying to find affordable housing, they’re looking elsewhere in secondary markets.They’re priced out of city centres, and that means the talent pool for jobs will end up in secondary markets.” The Marcus &Millichap’s 2019 Multifamily Investment Forecast Report notes that apartment projects have become more financially viable, as evidenced by 60,000 units in the pipeline countrywide.However, that’s little relief given how few vacancies there are. “The number of occupied units grew by 50,000 last year, outpacing supply growth nationally just as 37,000 new apartments came online,” read the report.“The national vacancy rate declined to 2.4%, the lowest reading since 2002.A shortage of construction workers,
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing January 31, 2019 116   0   0   0   0   0
Vancouver’s affordability saga continues unimpeded as the city’s single-family homes are now priced considerably above the median household income, according to a recent study by the National Bank. The analysis uncovered that the average monthly mortgage payment for a median-price single-detached residence in the Vancouver CMA was around 101.5% of the region’s average household income. National Bank stated that this was an unprecedented high, representing increases of 2.7% quarterly and 6.4% annually, Business in Vancouver reported. Falling salary growth combined with recent increases in interest rates were cited by the study as the main contributors to the trend, despite the fact that the median price of Vancouver’s single-family homes during Q4 2018 went down by 0.7% quarter-over-quarter, and had only a modest 1.8% year-over-year uptick. Condos experienced a similar cooling, with the mortgage for an average-priced unit in the Vancouver CMA accounting for 49.2% of household income during the fourth quarter, increasing by 1.3% from Q3 2018 and 6.3% year-over-year. Read more:B.C.’s young professionals are packing up for greener pastures[1] A January report from Altus Group warned that there seems to be no relief in sight for would-be home buyers in Vancouver, as the market is “exhibiting the most potential for downside risk,” Altus stated. Aside from pricing issues,
 
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