Firstly, I hope we all had the opportunity to acknowledge the sacrifice of the brave men and women that fought and died and those who continue to fight for us.
We live in an amazing country because of those brave Canadians.
In the market (See full Report)
GTA REALTORS® RELEASE MONTHLY RESALE HOUSING FIGURES
TORONTO, November 5, 2015 – Toronto Real Estate Board President Mark McLean announced that Greater Toronto Area REALTORS® reported 8,804 home sales through TREB’s MLS® System in October 2015. This is the best result on record for the month of October. “It is clear that many GTA households remain upbeat about home ownership because owning a home represents a high quality, long-term investment. We will see a big, new record this year for home sales reported through TREB’s MLS® System,” said Mr. McLean.
“Despite the record October result, I must point out that the Government of Ontario could hamper home sales in the near future. The Wynne government is seriously considering allowing municipalities throughout Ontario to institute a second land transfer tax on top of the existing provincial tax. Recent polling has shown that the great majority of Ontarians oppose this tax and would consider delaying a move if they were forced to bear the additional upfront cost,” added Mr. McLean.
The MLS® Home Price Index (HPI) Composite Benchmark was up by 10.3 per cent year over year in October. Over the same period, the average selling price for all home types combined was up by 7.3 per cent to $630,876. Price growth continued to be driven by the low-rise market segments. “Record sales coupled with a constrained supply of listings in many GTA neighbourhoods has underpinned very strong price growth throughout 2015. Even if we do see a greater supply of low-rise listings in the marketplace over the next year, market conditions will remain tight enough to see continued price growth well-above the rate of inflation,” said Jason Mercer, TREB’s Director of Market Analysis.
CMHC says foreign buyers may be pushing up luxury housing prices
The chief executive officer of the Canada Mortgage and Housing Corp. says foreign buyers may be playing a role in overvaluation in the Vancouver and Toronto housing markets and says the federal agency is seeking new data on real estate ownership.
“In Vancouver and Toronto, it is very possible that foreign buyers account for a substantial portion of the demand for pricier, luxury single-family homes,” CMHC CEO Evan Siddall said in a panel discussion Tuesday.
■ Vancouver foreign ownership research prompts cries of racism in hot housing market
■ House prices overvalued in 11 of Canada’s 15 biggest cities, CMHC says
■ Foreign buyers driving demand for luxury homes, Sotheby’s says
Foreign buyers may be contributing to an overvaluation of residential real estate, especially in the luxury segment, Siddall said. CMHC has said 11 of Canada’s cities are seeing some level of real estate overvaluation.
Foreign owners also present a risk for the CMHC, which is responsible for keeping Canada’s housing markets stable.
“While both domestic and foreign investment activity can be speculative, foreign investment may be more mobile and subject to capital flight. This would increase volatility in domestic housing markets,” Siddall said.
He said CMHC needs a better understanding of the extent of foreign ownership in Canada and plans new studies to collect this data. Last year, it studied foreign ownership in the condo sector and found it was very low — just 2.4 per cent.
Siddall referred to a Sotheby’s report that international buyers accounted for 40 per cent of total luxury home sales in Vancouver and 25 per cent in Toronto and to Vancouver urban planner Andy Yan’s recent account of foreign activity in the Vancouver market, which some have criticized as racist.
CMHC CEO Evan Siddall says the agency is seeking more data on foreign ownership of Canadian residential real estate. (CBC)
He said much of the evidence is anecdotal or has questionable methodology, and says better data is needed.
CMHC has begun asking property managers to provide information on the number of condominium apartment units owned by people whose primary residence is outside of Canada. It also is looking for broader-based data from realtors and land registry offices.
Siddall also addressed concerns raised about the exposure of the federal government to mortgage risk if there is a major correction in the housing
He said CMHC has “stress-tested” its own financial health in a scenario like the 2008 U.S. housing market crash, when there was a 30 per cent decline in house prices and a five percentage point increase in unemployment.
That kind of scenario in Canada would result in almost in an eight-fold increase in insurance claim losses, from $1.7 billion to $13.2 billion over five years and CMHC would swing from a $7.5 billion profit to a $2.8 billion loss, Siddall said.
CMHC has a capital cushion sufficient to cope with that kind of downturn, Siddall said, though it is studying shifting some of the risk to mortgage lenders, such as banks, so the burden on the federal government is not as heavy.
The federal agency also has tested itself against other grim scenarios, including global economic deflation persisting for five years, an oil price below $35 US a barrel, and a magnitude 9.0 earthquake in Vancouver.
“The bottom line: it would take a very severe housing downturn and a big jump in unemployment rates, both persisting for a number of years, to start eroding our capital in a significant manner,” Siddall said.
Construction Blog #12 – The saga continues
Where do I start? So much has happened since I last blogged.
The Roof Truss System
– Halleluiah! They roof trusses finally showed up and they were manufactured correctly – It only took 5 months longer than planned. .
– I thought I had a roofing company lined up. I called around 4 companies and accepted a quote from a large, supposedly reputable company – “ALPINE ROOFING” (DO NOT USE THESE CLOWNS!). I secured them about 6 weeks prior to needing their services. Signed contract and all. When I reached out to them one week before I needed them to start they said that they were “walking away from the job” – What? They went on to say that they were not making enough money and did not want to do the job. Later that day the sales rep said that if I gave them $4500 more they would do it. In addition they would have to substitute the quoted material as they did not order the material I requested. I would have to wait 6 more weeks to actually get the roof on!
Total “Horse Hockey”. I told the sales rep that I would take them to small claims court and sue them for any price difference charged by another company. Seriously, 6 weeks later they say they won’t do the job? I think that was their plan along. I.e. Right before the start of the job to hit me up for more money. I scrambled and got an even better company for slightly more money. Again, I will be suing for the difference. Lots of stress that I did not need and shame on them. They are one of the largest roofing companies in the GTA and somehow are not embarrassed by this. How can they operate?
– Anyway, the ice shield and deck armour are now on the roof making it water tight and the shingles will be on in the next 2 weeks.
Windows and Doors
– Most of the windows have arrived (2 weeks late) but the back garden doors have not. They promised me that tomorrow they will arrive (fingers crossed). This is stopping the progress for the masons.
Bricks and Masons
– The brick work has commenced but I’m running into issues as the brick layers can’t go past a certain height as the back garden doors have not been installed and the precast for the window and door surrounds is about 2 weeks delayed.
Water and Sewers
– Normally a pretty straight forward process but of course not this time. The water and sewer lines had to come across (underneath) the tree protected zone at the front of the property. Remember Urban Forestry!
Yikes. What should have cost about 4-5k ended up tallying $10,500. Budgets are a must but in so many instances the unforeseen is shattering them. Last week was stressful but at least the sewers and water got hooked up. All with proper flow and slope. There was concern that the sewer at the street would not be deep enough and that I might have to have a sumo pump to pump out the sewage. In the end it was better than expected and the slope is perfect.
The next 2-3 weeks is critical as it’s a race to seal the home before winter starts. The real stress has to do around the brick and stone work as once it gets cold it becomes very difficult and very expensive to lay.
Our credit line balance looks like the debt clock in Time Square. Will we run out of money/credit/sanity before we move in? Tune in next week – Same bat time – same bat channel.
I have aged a few years in the past few months but it has been exciting and educational. Really, this is only possible because the tremendous support we are getting from our family, friends and neighbours.
Have an amazing end of the week and fantastic weekend, Anthony