According to fresh data, the Canadian real estate market is booming again.
In a world where interest on your savings account is in the two-per-cent range and secure investments such as locked-in guaranteed investment certificates aren’t paying a whole lot more, houses are once again feeling like the best place for ordinary Canadians to keep their money.
The question being asked by many young Canadians, who are considering buying their first home and many boomers at the other end wondering when to sell, is whether those house price increases will continue in 2020, or will it all come crashing down.
Most commentators from the real estate industry have been upbeat in their outlooks for the coming year.
While not the 30 per cent increments Vancouver saw at the peak of the boom, new figures from the Canadian Real Estate Association (CREA) out on Monday suggest that if you bought a house in November a year ago, that house was worth 8.4 per cent more in November this year.
As a return on a safe investment in the current market, that’s astounding. And the tax advantage makes it even better.
Covering your assets
For most Canadians who only own one home, Canadian tax law means that the entire eight-odd per cent increase — about $40,000 on CREA’s average priced home and $80,000 on the average million-dollar homes of Toronto and Vancouver — is entirely income-tax free.
Not only that, but the CREA prediction for next year shows prices will rise another, tax free, 6.2 per cent. What is not to like about such staggering returns?
Well, as usual, if making-money were easy, we’d all be multimillionaires. Details matter. And for another thing, if you want to cover your assets, you can’t just look at the bright side.Is now the time to rent or buy? One expert Hilliard MacBeth is still advising young people to avoid the condo market where he thinks prices have become detached from the land value they represent (Don Pittis/CBC)
Over the longer term, Canadian property prices are in all likelihood a safe bet. While prices dip periodically, they almost always recover again. But that can take a decade or more.
In fact, a closer look at that 8.4 per cent rise in prices, according to CREA economist Gregory Klump, tells us that until just the last few months prices have not been doing so well. Effectively, the big percentage increase is based on comparing a high point in November this year with a low point in November a year ago.
Overall, comparing all of 2018 to all of 2019 shows prices are only expected to rise 2.3 per cent by the time this year is over. So that is a detail to remind you that it depends on exactly when you buy and when you sell. And not only when, but where.
“There was an almost even split between the number of local markets where activity rose and those where it declined,” said the CREA report. “Higher sales across much of British Columbia and in the Greater Toronto Area offset a decline in activity in Calgary.”
Too much euphoria?
If you are ever worried that you are feeling a bit too euphoric about the state of the property market and your enthusiasm needs damping down, one useful option is to talk to Hilliard MacBeth, or better yet read his book When the Bubble Bursts.
There aren’t a lot of people who say the Canadian housing market remains overvalued and is heading for an inevitable fall, but MacBeth is not the only one. Swiss bankers at UBS recently put out their latest Global Real Estate Bubble Index, and Toronto had the honour of second place between Munich and Hong Kong. Vancouver came in at No. 6.
“The people who are really suffering in the residential side are the new home builders who have built too much product on the outskirts of Edmonton and Calgary,” said MacBeth, on the phone from Edmonton at the end of last week. “I think the term is ‘immediate availability’ — code for ‘we’re desperate.'”
Canadian Real Estate Association figures are based on resale homes, but in Calgary and Edmonton new home builders who have too much product in the pipeline are really suffering, MacBeth said. (CBC)
He says there are bargains to be had, so long as you don’t think prices are going to go down further yet.
As MacBeth points out, under priced new-builds are not included in the CREA numbers, nor are mortgage defaults, which are often sold quietly by the foreclosing banks. He said that houses withdrawn from the market because the seller is dissatisfied by offer prices also don’t make it into the data.
In some ways, MacBeth says the property market in Alberta and Saskatchewan — currently suffering from a continued downturn in the oil and gas sector — represents a foretaste of what could happen if the wider Canadian economy were to go into recession.
It is something Stephen Poloz in his Bank of Canada year-end speech and news conference last week said he had taken into account. While the central bank sees the large pile of mortgage debt accumulated by Canadians as sustainable, it remains the principal vulnerability for Canada and its financial system.
‘A nasty shock’
“If a nasty shock came along and unemployment in Canada rose significantly … the effect of that shock would be magnified,” Poloz told business reporters. “So we would have a bigger and more prolonged recession than if that debt was not there.”
Poloz was in no way predicting a global or Canadian economy shock this coming year, but he said Bank of Canada modelling shows that even in the worst case, the country’s banking system would remain sound.
Having studied the central bank’s predictive scenarios, MacBeth is not so sure. But of course gloom, especially in the property market, is one of his specialities.
He is still advising young people to avoid the condo market where he thinks prices have become detached from the land value they represent. He is advising people to rent, and notes that construction companies working on purpose-built rental properties will continue to do well, selling them to pension funds for the reliable stream of future income they represent.
“So will 2020 be the year of recession in Canada? I suspect it will, and if that’s the case, then it will be a particularly challenging time for Canadians because we’ve never gone into recession with private-sector debt levels — both corporate and household — at such high levels,” said MacBeth.
That may be the minority view, but now you’ve been inoculated. It’s safe to go back and read some real estate optimism about how property has nowhere to go but up in 2020.
Vancouver Canucks winger Dakota Joshua has announced he’ll miss the start of training camp following surgery for testicular cancer.
Joshua said in a statement posted to social media by the team Tuesday that he felt a lump on one of his testicles this summer and later had surgery to successfully remove the tumour.
The 28-year-old from Dearborn, Mich., said he plans on returning to play “as soon as possible” and is “working hard every day” to rejoin his teammates.
Joshua said the last several weeks have been “extremely challenging” and encouraged men to get checked regularly for testicular cancer.
The six-foot-three, 206-pound forward had a career-high 18 goals and 14 assists in 63 games for the Canucks last season and signed a new four-year, US$13-million deal with Vancouver at the end of June.
The Canucks are set to open their training camp in Penticton, B.C., on Thursday.
This report by The Canadian Press was first published Sept. 17, 2024.
TORONTO – Coach John Herdman isn’t putting too much stock in the fact that Toronto FC, since losing 4-0 in Columbus on July 6, has posted a better league record than the defending MLS champion.
Toronto, which beat visiting Austin 2-1 on Saturday, has won four of six league outings (4-2-0) since that setback at Lower.com Field while the Crew are 3-2-2.
“I don’t put any credence (in that),” said Herdman. “I just look at their squad and I salivate.”
Its easy to see why.
Columbus provided a league-high five players to the MLS all-star game on its home field in July in defenders Rudy Camacho and Steven Moreira, midfielder/captain Darlington Nagbe and forwards Cucho Hernandez and Diego Rossi.
Herdman sees layers of talent behind those all-stars.
“You see the way that they’re able to almost carbon-copy players. One comes in, another goes out … and they feel like they have a very similar profile. So to be able to take (Christian) Ramirez out and then bring (Canadian forward Jacen) Russell-Rowe in as a power forward, you look and go ‘Whoa, that’s good to have.'”
Federico Bernardeschi was Toronto’s lone all-star.
Columbus (14-5-8) comes to BMO Field on Wednesday in third place in the Eastern Conference, five places and 14 points ahead of Toronto (11-15-3). A playoff position already clinched, the Crew are hoping to leapfrog Cincinnati into second spot.
Coach Wilfried Nancy is looking forward to matching wits against Herdman.
“John is going to cook (up) something,” the Frenchman said with a belly laugh. “I know John. When we played a game in (the) pre-season, it wasn’t a pre-season game. It was a real game. But this is John. That’s why I like him, because he’s intense all the time.”
“They’re going to try to go all-in. They’re going to try to press us, they’re going to try to match us,” he added. “They know exactly the way we want to play so we’ll have to be clever and creative also.”
Herdman, meanwhile, says TFC will have to play error-free football.
While the Crew have failed to score in their last two outings (a 4-0 loss to visiting Seattle and 0-0 draw at rival FC Cincinnati), Toronto is hurting in its backline.
Nicksoen Gomis and Henry Wingo both left the Austin game early with hamstring injuries with Herdman estimating that Gomis will be out three to four weeks and Wingo 10-12 days. Veteran Kevin Long missed the Austin game after tweaking his hamstring in training and will undergo a fitness test ahead of the game.
Shane O’Neill, meanwhile, is suspended for yellow-card accumulation.
“A tricky situation,” said Herdman.
The Crew are a formidable opponent.
Columbus is tied with Real Salt Lake for fifth in the league in averaging 1.93 goals a game. Only Inter Miami (2.32), Portland Timbers (2.00), Los Angeles Galaxy (1.97) and Colorado Rapids (1.96) score more.
And Columbus boasts the league’s stingiest defence, conceding 1.04 goals a game. In contrast, the Toronto defence is tied for 22nd at 1.76 goals a game.
Toronto has conceded 51 goals, 23 more than Columbus, which has collected more points (7-3-4, 25 points) on the road in league play this season than Toronto has at home (7-7-0, 21 points).
Columbus’ roster also includes Canadian wingback Mo Farsi, who scored in the July win over Toronto.
The Columbus game is the first of four in an 11-day stretch that will see TFC club visit Colorado on Saturday, Vancouver on Sept. 25 in the Canadian Championship final and Chicago on Sept. 28. Toronto will then close out the regular season at home to the New York Red Bulls on Oct. 2 and Inter Miami on Oct. 5.
If the playoffs were to start tomorrow, Toronto would face ninth-place D.C. United in a wild-card matchup with the winner advancing to take on the East’s top seed — currently Miami — in the best-of-three first round.
Herdman would like a different scenario, with his eyes set on overtaking seventh-place Charlotte, which has two points and a game in hand over Toronto. The seventh-place side takes on No. 2 — currently Cincinnati — in the first round.
“We’re looking up, not down at the moment,” said Herdman. “It’s a good motivation for the lads to see that next level on the table. And it has been raised. If we’re able to get to that point, it means you’re not headed down to Miami in the heat, which is a tough place to go.”
“We’ll take whatever comes,” he added. “But the critical part is to get into these playoffs. That’s the key mission at the moment.”
Toronto has not made the post-season since 2020 when, after finishing second overall in the Supporters’ Shield standings, it was upset by Nashville after extra time at the first hurdle.
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This report by The Canadian Press was first published Sept. 17, 2024
MIAMI GARDENS, Fla. (AP) — The Miami Dolphins placed Tua Tagovailoa on injured reserve Tuesday after the quarterback was diagnosed with his third concussion in two years.
Tagovailoa will be sidelined for at least four games. He will be eligible to return in Week 8 when the Dolphins host Arizona, but has to complete a series of tests and assessments required by the NFL’s concussion protocol before he can return to the field.
Tagovailoa was hurt last Thursday night when he collided with Buffalo defensive back Damar Hamlin. He ran for a first down and then initiated the contact by lowering his shoulder into Hamlin instead of sliding.
Players from both teams immediately motioned that Tagovailoa was hurt, and as he lay on the turf the quarterback exhibited some signs typically associated with a traumatic brain injury. He remained down on the field for a couple of minutes, got to his feet and walked to the sideline. The Dolphins diagnosed him with a concussion a few minutes later.
Coach Mike McDaniel has since cautioned against speculation on the quarterback’s future, stressing that he’s more focused on Tagovailoa getting healthy than what this latest concussion means for the team or for his career. Tagovailoa this week began the process of consulting neurologists about his health amid reports that he has no plans to retire.
Others around the NFL have offered their opinions on Tagovailoa’s future, including Raiders coach Antonio Pierce, who suggested he should retire.
“As far as Tua’s career is concerned, I think it’s an utmost priority of mine for Tua to speak on Tua’s career,” McDaniel said Monday. “Reports are reports. As far as I’m concerned, I’m just worried about the human being and where that’s at day to day. I’ll let Tua be the champion of his own career.”
McDaniel said Tagovailoa was at the team’s practice facility on Monday, greeting teammates and working with trainers.
“He’s doing good, man. Talked to him, he’s in good spirits,” receiver Jaylen Waddle said Monday. “(He’s) got the team in good spirits and everybody praying for him and hoping (for his) health.”
Head injuries have become a familiar, scary occurrence throughout Tagovailoa’s career.
In a September 2022 game against the Bills, he took a hit from linebacker Matt Milano, which caused him to slam to the ground. He appeared disoriented afterward and stumbled as he tried to get to his feet. He was cleared to return to that game and later said it was a back injury that caused the stumble. He was not diagnosed with a concussion.
Four days later, he got hit again during a Thursday night game at Cincinnati in which he was briefly knocked unconscious and was taken off the field on a stretcher. As he lay on the turf, his fingers appeared to display the “fencing response,” an involuntary motion typically associated with a brain injury. That time, he was placed in the concussion protocol.
The NFL and the players’ union made changes to the concussion protocol after those two incidents with Tagovailoa. Players who have problems with balance or stability are now prohibited from returning to a game.
Tagovailoa briefly considered retirement, but instead returned and studied ways to better protect himself on the field, including taking jiu-jitsu classes ahead of the 2023 season.
Tagovailoa has said he spoke to numerous neurologists who told him they did not believe he would be more susceptible to head injuries than any other player moving forward, nor would he be at a higher risk for chronic traumatic encephalopathy (CTE), the brain disease associated with repeated blows to the head. He was also diagnosed with a concussion while in college at Alabama.
With Tagovailoa sidelined, the Dolphins will go with backup Skylar Thompson when play at Seattle on Sunday. Miami also signed Tyler Huntley off the Ravens’ practice squad.
