In Toronto: Home prices broke records in 2020, condo prices appear to stop declining, and the challenges of making housing affordable in this city.
Elsewhere: Canada caps a turbulent 2020 housing market with growth, AOC's plan for America's housing problem, and why housing is the biggest challenge for NZ's Jacinda Arden.
Sales across the Greater Toronto Area surged 64.5 per cent year-over-year last month amid double-digit gains in all property types. The demand for detached homes is well established as families seek out more space in this work-from-home COVID era. John Pasalis, president of Realosophy joins BNN Bloomberg to discuss.
In Toronto, the prospect of new taxes on vacant homes and concerns about a potential bubble have done nothing to stem bidding wars. In fact, its housing market appears to be picking up pace. After three straight months of declines, activity shot up 22 per cent in December, with 11,264 transactions on a seasonally-adjusted basis, the highest monthly total on record, according real estate board data. Sales for all of 2020 surpassed 95,000, up 8.4% from 2019 and the third-highest number of transactions on record
Toronto embarks on short-term rental crackdown (The Globe and Mail)
The city passed its by-law to bring order to the unregulated free-for-all of short-stay accommodations in 2018, spent a year fighting off court challenges and saw its planned implementation for early 2020 delayed by the global pandemic. But if you’re looking for a dramatic dragnet-style bust to kick off an enforcement blitz from a city known for plonking cement blocks in front of by-law violating cannabis dispensaries or high-profile barbecue blockades you may be disappointed.
The struggle to make Toronto real estate affordable (Now Toronto)
We’re dealing with a really complicated system. People invest in land for personal value: a home for their family and/or investing for their future well being. Once you met those two goals, it becomes an ego issue. Your family needs are met. You have enough money for your savings, for a safe and comfortable retirement. Maintaining your house value, not renting at lower or not selling it for longer, becomes an ego thing. And that is actually quite destructive.
The novel coronavirus pandemic that caused upheaval in the work and home lives of Canadians in 2020 will continue to shape the real estate landscape in Toronto and many parts of Ontario in 2021, says John Andrew, a professor at Queen’s University in Kingston.
In the Vancouver area, there were 30,944 transactions last year, according to the region’s board. That was a 22-per-cent increase over 2019, when buyers were adapting to a higher foreign-buyers tax and stricter mortgage rules.
Board chair Colette Gerber said the COVID-19 pandemic brought the housing market to a "near standstill'' in March, but demand for housing returned through summer, fall and winter— intensified by low interest rates. "Robust December sales outpaced long-term averages in what's traditionally the quietest month of the year in real estate,'' Gerber said in a statement. "This was part of an unusual seasonal pattern the market followed last year, which can be attributed in large part to the pandemic.
While bidding wars for houses are poised to heat up in many parts of the country, condos are a different story. All the experts agreed that small one-bedroom condos in downtown cores have already seen a price hit in 2020, and these prices aren’t expected to quickly rebound in early 2021.
Though technocratic-minded politicians believed offering families housing vouchers instead of apartments in decaying developments would give them better choices, all it really created was more precarity and instability, more ways to be priced out in a fevered housing market. In the 2010s, rent skyrocketed in many American cities with wealthy newcomers swarming once overlooked neighborhoods, cities blocking affordable housing proposals and real estate developers filling skylines with pricey condominiums.
Accessory dwellings offer one solution to the affordable housing problem (Washington Post)
Cities that have eased or are looking to ease regulations for these units include Evanston, Ill.; Greenfield, Mass.; Maplewood and Princeton, N.J.; and Edmonds, Wash. Missoula, Mont., home of the University of Montana, relaxed ADU regulations in October, raising the maximum allowed height to 25 feet, and removing requirements for owner occupancy and parking.
US mortgage executives forecast a $3tn year in 2021 (Financial Times)
Mortgage rates are at all-time lows, which is good for homebuyers. The current average rate for a 30-year fixed-rate mortgage is now under 2.7 per cent, according to Fannie Mae, a full percentage point lower than a year ago. But rates could fall further because mortgage lending is currently very lucrative by historical standards. One proxy for this profitability is measured by the so-called “primary-secondary spread” — the difference between mortgage rates charged by lenders and the yield on government-insured mortgage-backed securities.
New Zealand's housing crisis poses big test for Jacinda Ardern (Financial Times)
“We’ve probably seen the biggest widening of wealth distribution that we have ever seen in New Zealand between people who own houses and those who don’t."
Hu’s experience is echoed by a new generation of migrants struggling over housing in Shenzhen, China’s answer to Silicon Valley. Rising from a tiny fishing village to a metropolis of about 22 million people in four decades, the city is a beacon for young workers dreaming of becoming the next Jack Ma, or at least joining the middle class.
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.
January 8, 2021This Week In Real Estate |