Posts Tagged ‘time’

St. Catharines-Niagara CMA

Comments: 0January 4th, 2010 by admin

Posted by Moshe Alexander

The vacancy rate for private rental apartment buildings with three or more units in the St. Catharines- Niagara CMA (hereinafter Niagara) was above the national and historical averages. According to the CMHC’s Fall 2009 Rental Market Survey, the vacancy rate edged up to 4.4 per cent in 2009. This was above the 20-year average level of 3.5 per cent, and an increase of 0.1 percentage point from last year. Four main factors placed upward pressure on the vacancy rate. First, record low mortgage rates in combination with lower prices in the earlier part of the year translated into very affordable mortgage carrying costs. Many buyers, in particular first- time buyers, took advantage and moved out of rental accommodation and into home ownership. A comparison of average rents and mortgage carrying costs based on the mortgage terms chosen by most first-time buyers (i.e., maximum amortization period and the minimum down payment allowed) suggests that the gap between the two narrowed by more than 50 per cent in the first quarter of 2009.

Also, youth aged 15 to 24 are a key source of rental demand. Weaker employment among youth in this age group meant that some of them, after losing their jobs, moved back into their parents’ homes, or alternatively, postponed a decision to move out. Total employment for all age groups declined by around 11,000 people or 5.6 per cent when comparing the average level in the 12 months ending September 2009 to average level in the same period a year earlier.Youth employment declined by 4,500 people or 14 per cent, of which 2,900 in full- time positions and the rest in part- time jobs.

Finally, there were fewer international immigrants in 2009, due to the global economic slowdown. Since they traditionally tend to rent after landing in Canada, this implies that rental demand in 2009 was not as strong as in the previous years. Many international migrants find it difficult to settle in the region and land a job. Instead, they prefer to settle in major centres, such as the Greater Toronto Area, where they are more likely to find their first job and where there are established social networks.

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Posted in CMHC, Canada, Rental Market, affordable housing

Canadian Real Estate Falls As Mortgage Rates Rise

Comments: 1June 16th, 2009 by admin

The U.S. isn’t the only country facing increasing mortgage rates. Several Canadian banks have increased their posted mortgage rates by .2% as housing value decreases are accelerating. For more on this, see the following article from Property Wire.

vancouverrealestate

Residential property prices are continuing to fall and now there are fears that increases in mortgage rates could put off a lot of investors, especially first time buyers.

Canadian home prices fell 5.8% in March from the same month a year earlier, a faster pace of decline than in February, according to the latest published figures from the Teranet-National Bank National Composite House Price Index. It also shows that prices were down 8.5% nationally from the peak in August last year.

Western Canadian home prices were hardest-hit, with Vancouver leading with a 9.6% decline in March from a year earlier, while Calgary saw prices fall 8.4%, and Toronto saw a 6.9% slide. Halifax reported the smallest decline at 0.8%.

Montreal and Ottawa bucked the trend in March with property prices rising 2.9% and 1%, respectively. The index also showed home prices fell 4.1% year-over-year in February.

Analysts were confident that first time buyers were the key to recovery in the market but now Canada’s biggest banks are putting up key mortgage rates. Royal Bank of Canada, Bank of Montreal, Toronto-Dominion Bank, the Bank of Nova Scotia and Canadian Imperial Bank of Commerce are all increasing their posted rates on five-year, fixed-rate mortgages by 0.2% to 5.45%.

Paula Roberts, a mortgage broker with Mortgage Intelligence, said she hopes that buyers will not be put off by the new rates. She explained that the rises are coming from ‘abnormally low’ levels and there are still have plenty of opportunity to take advantage of lower borrowing costs because not all lenders will pass on the increases.

But there are fears that rates will go up even further as the government is concerned about inflation.

‘Certainly there is the recognition that interest rates are going to have to go up both because of the need to rein some of this monetary stimulus in once the economy gains traction and the level of debt that is being issued by governments,’ said Toronto-Dominion economist Grant Bishop.

And Canadians are borrowing less according to a report from Statistics Canada. ‘Net new mortgage borrowing contracted during the first three months of 2009, as investment in residential construction and activity in the resale housing market continued to decline,’ it said.

Note from Moishe Alexander, CFC CEO
This article has been reposted from PropertyWire. View the article on PropertyWire’s international real estate news website here.

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Posted in Alberta, British Columbia, CMHC, Housing Market, Manitoba, Newfoundland, Ontario, Quebec, Rental Market, Uncategorized

Toronto: Total Market Recovery

Comments: 0June 15th, 2009 by admin

By Brian Madigan LL.B.

The Toronto Real Estate Board has just released its May statistics. Both sales and prices are up.

There were 9,589 sales in the GTA in May 2009. That’s about 2% higher than May 2008.

The height of the market in terms of price was actually April 2008, when the average price of a single family home in the GTA reached $398,687. In May, the average price climbed back to $395,609; that’s just 0.77% less than the all time high. In fact, it may not be statistically significant.

This certainly dispels the notion that it’s a buyers market and prices are going to drop by 50%. That was just pure speculation by some optimistic, would-be buyers who failed to follow the monthly trends. It was also a popular topic in the media.

This is a full and complete recovery. There has been a transition from a buyers’ market, earlier in the year, to a balanced market, which is where we find ourselves now.

There are several factors that contribute to the recovery:

o Interest rates are at 50 year lows
o The Bank of Canada prime rate sits at 0.25%
o There is a reasonable supply of product
o Buyers have returned to the marketplace
o There is a good deal of consumer optimism
o The stock markets have rebounded about 50% from their lows

If this trend continues, you will also find that market prices will increase. This will be due to:

o better product availability, and
o the true cost of ownership.

In a buyers’ market, sellers with good product just don’t enter the marketplace unless they have to. If they can wait, they will wait. So, rarely is there a good property that buyers’ will stretch for. However, in a balanced market or a sellers’ market, buyers will stretch their finances to acquire premium products.

Also, the true cost of ownership has dropped. While the prices are now the same as last year, mortgage rates have declined by 40% to 50%. Effectively, if you were to fully mortgage a property, the long term cost has declined measurably. So, a $500,000 property today costs a lot less than a $500,000 property one year ago.

If you have a job, and you can borrow money, this is the time to buy!

Brian Madigan LL.B., Realtor is an author and commentator on real estate matters, Royal LePage Innovators Realty
905-796-8888

http://ontariorealestatesource.blogspot.com/2009/06/toronto-total-market-recovery.html

It was a reporot from Moishe Alexander, CFC CEO

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Posted in Alberta, British Columbia, CMHC, Housing Market, Manitoba, Newfoundland, Ontario, Quebec, Rental Market, Uncategorized