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Canadian Real Estate: Is Your Home Making More Than You Do? – RE/MAX News

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How hot is the Canadian real estate market right now? It is skyrocketing so much that the Canadian Real Estate Association (CREA) is projecting that the housing market is poised to post record highs again this year. According to the association, more than 700,000 properties will change hands in 2021, up from 551,262 last year. The national average home price will surge by an annualised rate of 16.5 per cent to $665,000 this year. All this is because demand is exceeding supply at a record-breaking pace.

But will this strength continue in 2022? CREA believes that the Canadian real estate market will be beginning to cool down next year, with 614,000 transactions and prices coming in below $680,000.

“At this point everyone knows how far the current monthly sales numbers are from historical norms, and that they have been setting record after record for eight months now, so this should not be a surprise,” CREA chair Costa Poulopoulos said in a statement.

CREA senior economist Shaun Cathcart offered a unique perspective on the housing boom, too. He asserted that regulatory changes in the real estate industry leading up to the pandemic contributed to the spike. The other factor, according to Catchart, is that households want to have a home they can ride out the COVID-19 public health crisis.

There might also be a fear of missing out (FOMO), with many Canadians concerned that prices will continue to surge and mortgage rates will eventually normalise.

“We are right at the start of the first undisturbed (by policy or lockdown) spring housing market in years and we also have the most extreme demand-supply imbalance ever by a large margin,” said Cathcart in a news release.

The new forecast comes after CREA confirmed that residential sales increased 39.2 per cent year-over-year in February, and prices advanced 25 per cent from a year ago to $678,091. By now, it is clear that your home – detached, semi-detached, townhouse, or condominium – is earning more than you. So says a new report from a leading financial institution.

BMO Study: ‘Your House Makes More Than You Do’

Do you own a home in the Canadian real estate market? If so, your property is likely earning more than you are at your 9-to-5 job, says a new study by the Bank of Montreal. Whether you currently own a townhome in the core of downtown Toronto or reside in a semi-detached house in the picturesque Okanagan Valley, the soaring value of your humble abode is making you wealthier than working Monday to Friday.

The BMO study, titled “Your House Makes More Than You,” concluded that housing prices are rising faster than family income and total annual income. While this is not prevalent throughout the entire Canadian real estate market, it is true for all of Ontario and many places across British Columbia.

“Normally asset prices start to raise red flags when they consistently outrun growth in underlying income or earnings. But across much of Canada, and notably Ontario, house prices are not only rising faster than family income, they are rising more than total annual income,” wrote Sal Guatieri, the senior economist at BMO, in a client note.

Indeed, Canada’s median family income is $83,900, but the national average home price is a whopping $531,000. Within the country, the Hamilton-Burlington real estate market southwest of Toronto, maintains a benchmark house price that increased by $154,000, or 24.24 per cent, in the past year to $786,600. According to the 2016 census, the median household income in this region is a little more than $75,000.

The report also assessed several other B.C. and Ontario markets (based on Jan 2021 CREA figures):

Woodstock

  • Benchmark House Price: $499,800
  • House Price Change (Jan. 2020 to Jan. 2021): +31.7% or $118,200
  • Median Household Income: $86,970

Ottawa

  • Benchmark House Price: $561,000
  • House Price Change (Jan. 2020 to Jan. 2021): +22% or $102,000
  • Median Household Income: $86,541

Fraser Valley

  • Benchmark House Price: $911,300
  • House Price Change (Jan. 2020 to Jan. 2021): +9.08% or $75,900
  • Median Household Income: $69,289

Is Homeownership Impossible in Canada?

With real estate prices going through the roof, there are concerns that the homeownership dream is becoming less of a reality for many Canadians. The data is pointing to concerning trends for first-time homebuyers in particular.

The number of months to save for a down payment for a home across the Great White North has surged to an all-time high. Canadians need to save the longest in history to purchase a home, according to a new study from the National Bank of Canada (NBC). NBC data revealed that the median household needs 60 months of savings for the minimum down payment. The previous high was 57 months that took place in 1989, which had slumped to by 1992.

Separate NBC data also highlighted that Canadians need to earn more to carry a mortgage. In Toronto, for example, only 20 per cent of households could afford to purchase a non-condo home as they would need to maintain an annual income of $178,499 per year. Condo residents would need more than $124,000 per year in income.

Yet not all hope is lost! The one thing that homebuyers have in their advantage are historically low interest rates. The Bank of Canada (BoC) has slashed rates to near-zero, making borrowing cheaper than it has ever been. The central bank has signaled that it will not tighten policy until the economic recovery is well underway.

Overall, Canadian homebuyers – first-time, move-over, move-up, and out-of-town – are residing in a housing market that has its pros and cons. The most important thing is to save up, be prepared, do your due diligence, and have an impeccable team of licensed real estate agents on your side to help you confidently navigate this complex COVID-19-impacted real estate market!

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Canadian home sales, prices surge to new record in March

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OTTAWA (Reuters) – Canadian home sales rose 5.2% in March from February, setting a new all-time record amid strong demand in markets across the country, the Canadian Real Estate Association said on Thursday.

The industry group said actual sales, not seasonally adjusted, rose 76.2% from a year earlier, while the group’s Home Price Index was up 20.1% from last March and up 3.1% from February.

The actual national average selling price hit a new record at C$716,828 ($572,821) in March, up 31.6% from a year earlier and rising 5.7% from February.

($1 = 1.2514 Canadian dollars)

 

(Reporting by Julie Gordon in Ottawa)

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Hot real estate market sparks warnings to potential buyers as complaints to regulator double

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As home sales in the province continue on a dizzying trajectory, the province’s real estate watchdog and regulator are warning buyers to be wary of what they may be getting into.

The Real Estate Council of B.C. (RECBC) and the Office of the Superintendent of Real Estate said that in the first three months of 2021, they have seen an increase in inquiries and complaints.

Calls to the regulator were up 42 per cent over the previous year, while complaints, such as how offers were made and accepted, were double the number received in the same period in 2020.

“Buying a home is one of life’s biggest financial decisions. There are potential risks at the best of times, but with the added pressure and stress of the current market conditions, those risks are amplified,” Micheal Noseworthy, superintendent of real estate, said in a statement.

 

 

The Real Estate Board of Greater Vancouver says sales in the region have continued at a record-setting pace.

Residential home sales covered by the board totalled 5,708 in March 2021, up 126.1 per cent from March 2020, when the COVID-19 pandemic hit, and up 53.2 per cent from February of this year.

Rural and suburban areas have experienced the biggest spikes.

For the past two weeks, Jay Park has been in the middle of the buying frenzy.

He and his partner are trying to upgrade from their one-bedroom apartment to a two-bedroom condo or townhouse in Vancouver.

“I wish we had done this a month or two ago,” he said.

 

A condo tower under construction is pictured in downtown Vancouver in February 2020. (THE CANADIAN PRESS/Darryl Dyck)

 

Park put an offer on a $1-million condo, $4,000 above asking price.

“To entice the [seller], we put in a subject-free offer, but it wasn’t successful,” he said. “They accepted $110,000 over asking price that was also subject-free.”

The hot market has led to bidding wars. Some would-be buyers have even lined up outside for days to try to get a jump on a property.

Erin Seeley, the CEO of the council, is warning buyers to do their research and be aware of risks before making an offer.

“It’s really important that buyers have engaged with their lender before they’re making offers so they know how to stay within a reasonable budget,” she said.

Seeley said some of the complaints the council has heard from buyers is that they weren’t aware the seller has a right to take an early offer.

“And the seller was really in the driver’s seat about setting the pricing,” she said.

 

Demand continues to outstrip supply for housing in cities like Vancouver. (Rafferty Baker/CBC)

 

Aaron Jasper, a Vancouver realtor, advises clients to avoid cash offers and to include finance clauses even if it may mean they lose a deal.

“There’s a lot of frustration among buyers, feeling pressure to take some risk,” he said.

“You’re better to be delayed perhaps a year getting into the market as opposed to being completely financially ruined.”

Jasper also says realtors are limited in the advice they can give to clients on legal matters, home inspections, potential deficiencies with homes, and financing.

‘Caught up in the craziness’

Other tips from the council include seeking professional advice before making a subject-free offer or proceeding without a home inspection, and speaking to a professional to determine how market conditions may be affecting prices.

Meantime, people like Jay Park say they are still keen to buy. Park has more viewings scheduled and is optimistic.

“It’s a very exciting time for us, but I also don’t want to get caught up in the craziness and make a purchase that’s above our means.”

Source: – CBC.ca

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Black Press Media introduces one of Western Canada’s best real estate platforms helping home buyers Find. Love. Live. that new home

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Need an agent who knows the community?

Or, is it time to look for a new place to live, but you don’t know what’s on the market?

Whatever the real estate need is for residents in the communities of British Columbia, Yukon & Alberta, there’s a new way to do that one-stop shopping – by visiting Today’s Home.

The slogan for the site is “Find. Love. Live.”

“We want people to find their dream home, love it, and live in it,” said group publisher Lisa Farquharson.

Building on the success of Black Press Media’s niche digital platforms – Today’s Home brings the same wealth of knowledge and local expertise to the search for a home, be it buying, selling, or even just daydreaming about what changes you can make in the future.

Search hundreds of listings that local real estate agents have available.

The listings cover properties around the region, from a one-bedroom, one-bath condo for $339,900 to million-dollar acreages throughout the province of BC, Yukon, Central Alberta and beyond.

Click on a listing, and see not only the realtor handling the property sale, but links to his or her other listings and social media feeds. With the click of a mouse, take a virtual tour of the property, find the property’s walking score, and learn about nearby amenities.

There are links available to schedule a showing, or send the agent a comment or question.

Want to share a listing? When you click on the share button, you’ll actually send an attractive digital flyer of the prospective property, not just a link.

There’s even a button to help determine how much you have to spend, courtesy of the convenient mortgage calculator.

Plus, scroll down the page on Today’s Home and find a list of expert local real estate professionals who can answer questions or help with that home sale, Farquharson explained.

Today’s Home offers the advantage of the massive reach that Black Press Media has built throughout Western Canada with its network of community newspapers and online products. That allows the public to tailor real estate searches based on location, price, and other key factors while allowing real estate professionals to gain unprecedented audience reach with their listings.

Today’s Home will dovetail into the media company’s existing print real estate publications.

“Black Press Media has real estate solutions in print and now we can add in the digital component,” Farquharson said.

Watch for expansion of the Today’s Home platform in the near future, she added. That will come as Black Press Media adds a new component – the development community. Developers will be able to reach a huge audience when their projects are ready for presentation.

For information on Today’s Home, contact group publisher Lisa Farquharson at 604-994-1020 or via email.

Happy house hunting!

Source: – Aldergrove Star

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