Archive for the 'Real Estate Trends' Category

In the final quarter of 2018, Canadian housing affordability worsened for a 14th consecutive quarter, found economic research from the National Bank Housing Affordability Monitor.

Using data from the Teranet-National Bank House Price Index, National Bank Deputy Chief Economist Matthieu Arseneau and Economist Kyle Dahms released a quarterly report on January 24, 2019 analyzing the final three months of 2018.

And they found that house prices are getting less affordable in many markets.

The Housing Affordability Monitor featured a representative home for each of the 10 metropolitan markets in the House Price Index, including the representative price for the condo market and for the non-condo market, and the average household income needed for each.

Here’s what they found for October, November, December of 2018:

1. Toronto Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $902,916

Household annual income needed to afford the representative home: $165,755

Condo

Price of the representative condo in the metropolitan market: $536,082

Household annual income needed to afford the representative condo: $98,413

2. Montreal Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $369,234

Household annual income needed to afford the representative home: $67,783

Condo

Price of the representative condo in the metropolitan market: $276,889

Household annual income needed to afford the representative condo: $50,831

3. Vancouver Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $1,318,768

Household annual income needed to afford the representative home: $242,096

Condo

Price of the representative condo in the metropolitan market: $638,842

Household annual income needed to afford the representative condo: $117,277

4. Calgary Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $494,689

Household annual income needed to afford the representative home: $90,814

Condo

Price of the representative condo in the metropolitan market: $266,107

Household annual income needed to afford the representative condo: $48,851

5. Edmonton Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $422,508

Household annual income needed to afford the representative home: $77,563

Condo

Price of the representative condo in the metropolitan market: $231,117

Household annual income needed to afford the representative condo: $42,428

6. Ottawa-Gatineau Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $428,595

Household annual income needed to afford the representative home: $78,680

Condo

Price of the representative condo in the metropolitan market: $261,454

Household annual income needed to afford the representative condo: $47,997

7. Quebec City Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $286,491

Household annual income needed to afford the representative home: $52,593

Condo

Price of the representative condo in the metropolitan market: $211,768

Household annual income needed to afford the representative condo: $38,876

8. Winnipeg Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $321,259

Household annual income needed to afford the representative home: 58,976

Condo

Price of the representative condo in the metropolitan market: $223,614

Household annual income needed to afford the representative condo: $41,050

9. Hamilton Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $598,274

Household annual income needed to afford the representative home: $109,829

Condo

Price of the representative condo in the metropolitan market: $445,629

Household annual income needed to afford the representative condo: $81,807

10. Victoria Housing Market

Non-Condo

Price of the representative home in the metropolitan market: $850,469

Household annual income needed to afford the representative home: $156,127

Condo

Price of the representative condo in the metropolitan market: $485,937

Household annual income needed to afford the representative condo: $89,207

In some markets, the quarterly report found that the gap between condo and non-condo affordability is shrinking. The worst deteriorations in affordability in Q4 were in Victoria, Toronto, and Vancouver. The only markets showing an improvement were Calgary and Edmonton. Countrywide, affordability worsened.

View the full 2018 Q4 report from the National Bank here: https://housepriceindex.ca/wp-content/uploads/2019/02/NBFM-Housing-Affordability-Monitor-Q4_2018-Eng.pdf.

No matter what direction Canadian housing affordability heads, GeoWarehouse has tools that make you the property expert. Uncover real estate trends and opportunities before they hit the market.

Become a subscriber today. Call 1-866-237-5937 or visit www.geowarehouse.ca.

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As the saying goes, knowledge is power. And nowhere is that truer than the Canadian real estate market.

With the industry becoming increasingly competitive, sales professionals need resources that keep them in-the-know. In order to stand out, you need information that empowers you to make decisions.

There are two real estate resources every sales professional should use: the Teranet-National Bank House Price Index and the Teranet Market Insights Report.

Here’s what you need to know.

  1. Teranet-National Bank House Price Index

The Teranet-National Bank HPI is an independent representation of the rate of change of Canadian single-family home prices.

The measurements are based on the property record of public land registries, where the sale price is available.

The Index is released every month and looks at 11 market across Canada: Victoria, Vancouver, Calgary, Edmonton, Winnipeg, Hamilton, Toronto, Ottawa, Montréal, Québec, and Halifax.

How it works:

The Index is estimated by tracking the observed or registered home prices over time. Properties with at least two sales are required in the calculations.

All properties that have been sold at least twice are considered in the calculation of the index; this is known as the repeat sales methodology.

Properties that are not considered include those with:

a) non-arms-length sales,
b) change of type of property, for example after renovations,
c) data error, and
d) high turnover frequency (biannual or higher).

In the repeat sales methodology, the averaging of price appreciation from different pairs of sales is done using a complex estimation process in which each pair is a separate observation.

Why you should use it:

The HPI is particularly useful because it can give an accurate portrayal of home price shifts over time. The data is derived from the property records of public land registries — so you know it is accurate and trustworthy.

Often real estate agents look at house price figures from local MLS sales information. This isn’t necessarily a bad gauge, but it’s important to consider the Teranet HPI, too. That’s because the prices Teranet uses have been agreed to up to three months before the index is released and only finished transactions are used. If a sale falls through, the MLS data won’t always be accurate, but with the Teranet HPI you know you are looking at the final numbers.

The Teranet HPI also includes all transfer data, not just sales done through the MLS. This means there’s an estimated 20% more sales included — that could look like one in five sales being excluded from MLS reports.

Again, both should be taken into consideration, but if you are looking for accuracy and trends over time, the Teranet-National Bank House Price Index is a report you won’t want to miss.

See the latest HPI: http://www.geowarehouseblog.ca/home-prices-trended-down-in-the-second-half-of-2018/.

  1. Teranet Market Insights Report

The second report you’ll want on your regular reading list is the Teranet Market Insights Report.

This release takes into account all recent trends in the Canadian real estate market — everything from house prices, to mortgage broker-lender share, to dwelling type popularity, to generational buying habits, and beyond.

Each MIR release deep dives into a different part of the housing market. For instance, the October 2018 report examined the surge in private lending, while the March 2018 report looked at the Canadian condo market.

This is a great way to stay on top of trends and patterns and then use that information in your real estate marketing.

How it works:

Analysts at Teranet watch the Canadian housing market, using data derived from provincial land registries. They synthesize that data into analysis that takes a high-level look at the current real estate market.

Why you should use it:

The Teranet MIR is one of the most comprehensive real estate reports available in the Canadian market. The data within is sourced from information you can trust. The unique position of Teranet in the real estate market means that they have a view of the industry that is difficult to parallel.

The data contained in the MIR is applicable in many ways — you can use it in your real estate marketing, business strategy, property searches, and more.

If you have any interest in following industry trends, this is the report for you.

See the latest MIR: http://www.geowarehouseblog.ca/october-2018-teranet-market-insights-report-surge-in-private-lending-in-the-gta/.

These resources can both be gamechangers, especially if your industry is feeling saturated. They can help you find new opportunities and look at the market in ways you may not have considered.

After reading the reports, you may want to put the information to use through your real estate tools — like GeoWarehouse, which uses the same information as the Teranet HPI and MIR.

You can access up-to-date property searches, comparable sales, demographic reports, and more.

Learn all about it today. Call 1-866-237-5937 or visit www.geowarehouse.ca.

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January 28, 2019

Last year in 2018 we saw many changes to the Canadian housing market. Now that 2019 is here, what will this year bring?

We’re breaking down real estate predictions for the year ahead. Here’s what’s on our radar:

1. Interest Rate Increases

In 2018, we saw Canadian interest rates rise from 1% to 1.75% and more hikes are on the horizon for 2019. Economists speculate we may see interest rates reach 2.25% by 2020.

This may seem small, but it could have a big impact on Canadian household debt. It may change what kinds of houses Canadians are able to afford and how well they can keep up with expenses, like utility payments.

2. Housing Prices

Overall, in 2018, house prices in Canada rose at a slow rate — the slowest since 2009 in some months. The Teranet-National Bank House Price Index has captured all of the data from the past year. Toronto and Vancouver have struggled, but other markets, like Montreal and Ottawa-Gatineau, have recorded larger increases over the past few months.

In 2019, we may see more stabilization, but it will likely take more time before we return to where we were.

3. Dwelling Shifts

With increased interest rates and mortgage stress tests, homebuyers are gravitating towards different dwelling types — in particular condos and multi-family units. Supply for single-family residential homes is tight in major cities.

This may mean that multi-family units continue to rise in popularity. It could also mean that more families seek out different areas to reside in — for example, opting for an affordable small town instead of a bigger urban centre.

4. More Affordable Housing

In 2018, the Ontario Real Estate Association (OREA) joined forces with other agencies to lobby the provincial government for more affordable housing options for millennials. Particularly in Toronto, OREA has said there is a housing crisis.

This conversation is taking place across the country about how to create more affordable housing, especially with home prices on the rise. We expect these talks will continue into 2019.

5. Insurance Premiums May Rise

As of January 1, 2019, new MICAT (mortgage insurer capital adequacy test) guidelines are in effect, which could see default insurance premiums rise.

6. Technology

Digital transformation has been a buzzword for a while, but in 2019 we are entering a new age of real estate technology. On the residential front, this will look like more smart devices in homes — such as voice technology using Amazon’s Alexa or the Google Home

systems. Home buyers may also want to control lighting and other utilities from mobile devices and the like.

On the real estate sales front, more technology also amounts to more opportunities for sales professionals. We may see a surge in paperless real estate, or more automation being included in property evaluation, like aerial imagery from drones or viewing a home through virtual reality (VR).

No matter what changes affect the real estate market in 2019, GeoWarehouse can help you adapt. Our tools are accurate, up-to-date, and easy to access, meaning you’ll be able to stay agile and competitive.

Learn more by calling 1-866-237-5937 or visit www.geowarehouse.ca.

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November 26, 2018

There is one real estate opportunity that seems to only be growing in popularity: selling condos.

The Canadian condo market continues to boom. From 2016 to 2018, more than 14% of private mortgages came from condominiums.

In June 2018, residential construction starts across Canada surged to 248,000 units, driven by condos.

“While there has been some moderation in price growth and less speculative demand in the single-family home segment, prices for condominiums have continued to increase rapidly in some markets,” the Bank of Canada noted in its July 2018 Monetary Policy Report.

Condos have also benefitted from tougher mortgage rules and increased interest rates. As house prices have gone up, condos have remained the more affordable option. This means that not only are younger buyers opting for condos over traditional homes, but so are older buyers. For instance, some members of Generation X are choosing to move into condos for a smaller mortgage.

In 2017, three out of every four homes built were multi-family units, compared to 65% the decade before.

If you sell real estate in Canada, the signs are there that this is the time to consider selling condos, too.

Should you decide to join the condo market, or ramp up your efforts, here are some best practices to keep in mind:

  • Look at property details. Just like you would request a property report for a single-family dwelling, you should do the same for a condo. For instance, with a GeoWarehouse report you can see all condo units in a building, search by level, look up related PINs, access the full legal description, and more.
  • Don’t only consider constructed condos. Look also at pre-construction condos. New condo buildings are being constructed quickly, especially in larger urban areas like Toronto and Vancouver. Sell clients on making a decision early to beat the rush.
  • Condos aren’t just for younger buyers. As we mentioned above, condos used to be the millennials’ residence, but that’s not always the case these days. More and more older generations are choosing condos amid new mortgage rules, increased interest rates, or wanting to stay in an urban area. While millennials are certainly still a big market, they’re not the only market.
  • Look at what else the building offers. There may be additional assets included with a condo sale, like a parking space or storage lockers. Unlike a traditional dwelling type, a condo can come with other perks, too — security guards, an on-site gym, a luxury view, etc. Play up these features in your sales pitch.
  • Focus on unique features. Condos are a space sacrifice, especially if a potential buyer is used to a larger home. But because they are rising in popularity, there are many more options for comfortable condo living today, like urban agriculture, unique storage ideas, and two-in-one furniture items. Don’t be afraid to get creative with your staging.Access condo status certificates online. There is no need to request your condo status certificates by fax anymore. Instead, use a tool like GeoWarehouse to do it all online.

While the condo boom is continuing to thrive, it makes sense to take advantage if it’s in your area. GeoWarehouse can help you stay on top of the latest condo trends and access property information.

Learn more by calling 1-866-237-5937 or visit www.geowarehouse.ca.

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Staying on top of the latest real estate trends is important. In a recent report on international activity in U.S. residential real estate, a new trend seems to be surrounding Canadians snapping up a record number of properties in the United States at record prices. What’s going on?

The 2017 Profile of International Activity in U.S. Residential Real Estate report, released by the American National Association of Realtors, indicated foreign investment in American housing is at an all-new high, mainly because of a substantial increase in sales dollar volume from Canadian buyers.

The U.S. is seeing a large rise in out-of-country buyers according to the report, which also shows exponential growth in both the volume of foreign buyer transactions and the average price paid.

There are two foreign buyer types, resident and non-resident. Resident buyers have immigrated to the U.S., or have a long-term visa. Non-resident buyers use the home on occasion, maybe legitimately so. Yet, more often, they are just property speculators. According to the NAR’s report, most foreign buyers that come from China, India, and Mexico were resident buyers. Buyers from Canada and the United Kingdom were primarily non-residents.

With Canada’s housing prices remaining steady, the main reason for this trend in Canadian real estate seems to be that Canadian buyers want cheaper, more affordable housing to invest in – investments that some Canadian buyers can’t find at home. The NAR report notes that Canadians saw a rapid rise in domestic prices versus the rise in prices in the U.S. which could explain the attraction for Canadian buyers.

Between April 2015 and March 2016, foreign buyers picked up more than $100 billion in residential property – that’s almost 215,000 residential purchases in the United States. Another interesting fact from the report is that houses purchased by foreign buyers were generally priced higher than the median value of all U.S. homes. Chinese buyers purchased nearly 30 billion dollars’ worth of property. Canadians came in second with a record $19 billion worth of U.S. property purchased.

However, of all the foreign buyers, Canadians are the least likely to actually take up residency according to the report. Most are purchasing for a vacation home or property investment, with only a third planning to make the move. Another theory is that, after selling homes in markets such as Toronto and Vancouver, Canadian buyers find themselves with an abundance of capital, and with the more affordable options in the U.S., buyers can do more with that capital. A number of those are retirees moving to some of the top retiree states – Florida, Arizona, and Texas.

To learn more about this real estate trend, you can read NAR’s report here: https://www.nar.realtor/

At GeoWarehouse, we make buying and selling homes in Canada far easier. Find out more about the various features by visiting www.geowarehouse.ca today.

SOURCE: http://globalnews.ca/news/3611104/with-prices-at-home-surging-canadians-have-been-snapping-up-u-s-real-estate-en-masse/

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geo2Many Canadian economists have speculated that the Canadian economy is at risk of being in a recession. This would appear to be very scary news considering that it has been widely reported that Canadians are carrying record levels of debt.

The question many have had is will this end up having a negative impact on the real estate market?

Look at urban centres like Toronto where it was recently reported that the average sale price of a single detached home has exceeded 1 million dollars. Will these markets stay hot?

Some speculate that urban centres may cool off while the “burbs” will heat up. One thing is for sure, when the economy falters and Canadians are struggling to maintain their housing payments with their other bills like payments to debt, some will look at downsizing. This may include moving a little bit further away to be able to buy more for less.

When Canadian families are struggling financially there may be less lower income families coming into the housing market, but folks moving to put cash flow back into their households can more than offset this.

In a strained economic environment you have to be even more diligent when pre-qualifying new clients. Why?

  1. Pre market-crash of 2008 – mortgage financing rules were more lax so there are a high volume of people walking around who took out mortgages at 90-95% the value of their homes, amortized over 35 years and so have less equity.
  1. People in debt generally turn to debt consolidation as a first measure before making the difficult decision to sell their home. This can result in 1 very large mortgage refinance or perhaps 2 or 3 additional mortgages behind the first mortgage.
  1. When people have financial problems they can fall behind making monthly payments to things like property taxes, condo fees, income taxes and other bills leading to property liens – the homeowner may not even know is one has been registered.

What do the above 3 scenarios have in common? They can all result in there not being enough equity to pay you!

You can mitigate this occurrence by doing a basic preliminary background check on new listings:

  1. Validate that your client is the legal homeowner
  2. Look at the sales history of the property
  3. Estimate the value by reviewing comparable sales
  4. Review financial encumbrances like mortgages
  5. Check for liens

An unstable or underperforming economy doesn’t necessarily mean a negative impact to the real estate market but what it does mean is that you have to be agile to adapt in conditions that may emerge as a result.

If you would like to be able to access a tool that enables you to perform the due diligence discussed in this article and more please visit www.geowarehouse.ca.  

 

 

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5 Year Canadian Real Estate Trends

Author: GeoWarehouse
November 4, 2013

Real Estate TrendsIt comes as no surprise to most Canadians that, as the country continues to put the last few years of financial instability behind it, housing sales continue to rise. This graph, recently released by the Canadian Real Estate Association (CREA), demonstrates this, outlining some of the different trends that have impacted both spikes and declines. As the graph illustrates, sales in 2013 have been strong and continue to increase, signaling good things for the future. Even with CMHC guideline changes, criticized by some as a bad move as far as future home sales, Canadians are still purchasing and the real estate industry continues to thrive.

Sales right now are the highest they have been in almost three years, but how can you, as a real estate sales professional, work to keep them high? It is simple. With a few real estate tools that make finding the perfect home for your clients trouble-free, you can ensure that those sales are ending up on your desk and the commissions in your wallet.

–        Property Details Report: use this tool to access information regarding MPAC data, ownership, sales history and property images.
–        Neighbourhood Sales Report: use this tool to gauge market value by comparing recent sales in a given neighbourhood.
–        Neighbourhood Demographics Report: use this tool to find out about age distribution, family statistics, average income, etc.
–        Aerial Imagery: use this tool to determine the desirable (and undesirable) features of a neighbourhood.

Get the information you need to find your clients the home they love and close the deal from the comfort of your office.

For more information about GeoWarehouse real estate tools please contact us at 1-866-237-5937 or visit www.geowarehouse.ca.

 

 

 

 

 

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