In Toronto: Real estate prices and sales were at a high in September, but Condo-geddon looms as listings surge 215%.
Elsewhere: Housing starts in Canada decline, Americans brace for evictions as Stimulus talks fail, and a new approach to affordable housing after the lockdown.
Sales, prices set new records in a high-flying month for Toronto real estate (The Globe and Mail)
Competition for detached and semi-detached houses helped send the average selling price across all types of properties up 14 per cent to $960,772, compared with the previous year. Prices have been climbing month over month since May, after the slowdown in April when non-essential activity was halted to stop the virus from spreading.
September data from the Toronto Regional Real Estate Board and research firm Urbanation Inc. show a surge of units for sale, the beginning of a weakening trend for condos, along with a sharp decline in rents. That’s in spite of a boom in other segments such as single-family homes in Canada’s financial capital.
Trek through Toronto’s changed condo landscape (The Globe)
As the bidding was heating up at the Victorian-era industrial building in Liberty Village, prospective buyers were bypassing condos in other downtown Toronto buildings without even a glance inside. Mr. Riley says he has sold three lofts in the past month and all sold with multiple offers. At his listings for more run-of-the-mill condos, showings have dropped significantly, he says.
Shaun Hildebrand, president of Urbanation joins BNN Bloomberg to discuss the trends in Toronto real estate as volume sets a record while the downtown Toronto condo market sputters amid soaring supply and cratering demand.
Munich, Frankfurt, Toronto and Hong Kong topped the list of cities most vulnerable to a “sharp correction,” according to UBS Group AG’s annual Real Estate Bubble Index released Wednesday. Government support of personal income and property markets to combat the economic hits from the coronavirus lockdown, along with low interest rates and suspended foreclosures, pushed values higher in many cities, according to the report, which analyzed prices in the second quarter of 2020.
The decrease came as the annual pace of urban starts fell 21.1 per cent in September to 195,909. The pace of urban starts of apartments, condos and other types of multiple-unit housing projects decreased 27 per cent to 146,005 units, while single-detached urban starts increased 3.4 per cent to 49,904.
About 44 per cent of respondents expect the value of real estate in their neighborhood will go up over the next six months, according to the latest weekly survey by Nanos Research for Bloomberg News. That’s the highest percentage since March 13, before full pandemic shutdowns began and one of the strongest readings for this question in the past seven years. The share of Canadians who expect home prices to drop slid to 27 per cent, also the lowest since mid-March.
“It’s reasonable to assume that the next six months will not be very pretty,” said Mr. Tal. “The honeymoon of the summer is basically over. Now we enter the winter months, and I think the next few months will be much more difficult. We will have a situation where we will clearly see a second wave, and it’s already starting. This second wave will overlap with the flu season, so everybody will be very confused. The fear factor will rise, and that’s something we have to take into account when we look at the trajectory of the economy.”
The Democrat-controlled House of Representatives passed a $2.2 trillion package last week that included $50 billion in emergency rental assistance funds and banned evictions for another 12 months. But the Republican-controlled Senate “skinny” stimulus bill did not include rental assistance funding or any ban on evictions. It also did not include another round of stimulus checks, though Trump tweeted Tuesday that he would sign a standalone bill to issue additional $1,200 stimulus checks “to our great people.”
The nearly 20-year-old building — a modest transit-adjacent apartment building in Walnut Creek, California, just northeast of Oakland — is getting a $16 million facelift, and its developers will preserve its existing 86 units as affordable housing for residents making under 60% of area median household income, with some units set aside for tenants earning much less.
Mayor Bill de Blasio announced on Wednesday that he wants to rezone SoHo to allow for more residential buildings in Lower Manhattan, a move that the administration says could create 800 new affordable units there. Rezoning efforts in New York typically target neighborhoods that are far less wealthy, setting off tense battles with longtime residents over gentrification.
After Lockdown, New Thoughts on Affordable Housing (Washington Post)
The need for more aggressive state intervention was on the political agenda in many countries even before the pandemic, with numerous cities exploring market controls and public provision. In the U.S., Democratic presidential candidate Joe Biden backed an expansion of rent subsidies through housing vouchers granted by the federal government. In Europe – long more reliant on public housing than the U.S. – pressure grew in many cities for the state to expand its role as a direct provider of homes after decades of withdrawal from the market. Berlin attracted attention for freezing rents and for a citizen-led campaign to re-nationalize public housing sold to large companies, including Deutsche Wohnen SE.
The proposal for energy retrofits is part of the climate actions at the core of the EU’s 1.8 trillion euro ($2.1 trillion) coronavirus recovery plan and could result in a sweeping architectural makeover, one that leaders have compared to a new Bauhaus movement for the continent. One schedule calls for renovations of as much as 2% of the continent’s building stock every year. That type of “renovation wave” would advance the goal of making Europe the world’s first climate-neutral continent by 2050 and could present an opportunity for a symbolic transformation as well.
Realosophy Realty Inc. Brokerage is an innovative residential real estate brokerage in Toronto. A leader in real estate analytics, Realosophy educates consumers at Realosophy.com and MoveSmartly.com and and helps clients make better decisions when buying or selling a home.
October 9, 2020This Week In Real Estate |