Connect with us

Real eState

Edmonton leads Canada in return to office recovery in third quarter, real estate report says – Edmonton Journal

Published

 on


Article content

Edmonton is leading Canada in return-to-office trends, says a new report from real estate firm Avison Young.

Advertisement

Article content

At the end of the third quarter, 35 per cent of the workforce in Edmonton was returning to Downtown offices compared to pre-pandemic levels, said the report released last week.

“There’s a willingness to get back to offices and not nearly as much abandonment of office spaces that people had speculated would occur,” said Puneeta McBryan, executive director of the Downtown Business Association.

The “community vibe” of the Downtown, where office workers enjoy meeting with workers from other companies is one factor behind the return, she said. Edmonton has easier access to Downtown with personal vehicles compared to other major Canadian cities where people rely more on public transit, she said.

However, the report notes that office usage Downtown remains about 53 per cent below pre-pandemic levels.

Advertisement

Article content

The trend is being driven by other positive currents, such as a 20 per cent increase in real estate transaction volume in 2021 compared to 2020.

Avison Young cited activity like the Terra Centre for Teen Parents, which sold its downtown location to buy a larger office further west, the Edmonton Catholic Separate School Division that bought a new building in east Edmonton and the Edmonton Police Association that sold its central location for a larger facility in the northwest.

McBryan pointed to real estate services company Savills that announced in April it was opening a new office in Edmonton, near 124 Street.

As pandemic-related restrictions are anticipated to loosen as vaccination rates rise, Avison Young said it expects 2022 to be a “very active year” for office market transactions.

Advertisement

Article content

McBryan is similarly optimistic, noting that the last six months have seen some long-term office leases in the city renegotiated and new leases signed.

“One high profile company is moving into a different Downtown space and another one is making a significant investment in renovating. To remain Downtown shows they have the confidence. But I don’t want to name them before they make official announcements,” she said.

With workers having adapted to working from home, McBryan believes that employers will increasingly introduce more flexible arrangements as employees go back to the office.

Some might ask employees to come to the office for only certain days, and cubicles could become less permanent, with workers booking cubicles only for the days they’ll come in.

bmcbride@postmedia.com

twitter.com/blairmcbride

Advertisement

Comments

Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.

Adblock test (Why?)



Source link

Continue Reading

Real eState

This Week’s Top Stories: Canada’s Immigrants Are Unhappy With Real Estate and Central Banks See Odds of A Correction Rising – Better Dwelling

Published

 on


[unable to retrieve full-text content]

This Week’s Top Stories: Canada’s Immigrants Are Unhappy With Real Estate and Central Banks See Odds of A Correction Rising  Better Dwelling



Source link

Continue Reading

Real eState

Investment properties are driving up Toronto real estate prices: report – NOW Toronto

Published

 on



Bank of Canada says buyers are making the housing market more vulnerable to a correction


Homeowners purchasing investment properties are driving up prices in Toronto real estate and making the housing market even more vulnerable to a correction, according to the Bank of Canada.

In a November 23 speech summing up a trend across Canada but especially felt in Toronto and Montreal, Bank of Canada’s deputy governor Paul Beaudry says investors are flocking to buying secondary or multiple homes with expectations for future price increases, which he says can become “self-fulfilling” in the short term but catastrophic later.

The damage from a drastic fall in house prices can “spread far beyond the investors” because so for many households have their wealth tied to low-mortgage rates and the value of their home.

“A key concern here is that financially stretched households have little breathing room to absorb any disruption to their income,” Beaudry says.

Beandry’s speech comes as more and more homeowners are witnessing massive real estate price gains, particularly over the past year, experiencing FOMO and jumping into the investment property game, seizing on every available listing and pre-construction condo opportunity up for grabs. They’re able to scoop up properties by leveraging the equity amassed on their homes from those very same price gains, which leaves first-time homebuyers in the lurch.

According to Teranet’s market insight report, 25 per cent of the people purchasing a home between January 2011 to August 2021 were multi-property owners, competing against roughly the same number of first-time home buyers.

A chart provided by the Bank of Canada shows the year-over-year growth in investors buying homes surged 100 per cent compared to just over 40 per cent among first-time home buyers. The growth between these demographics were roughly in line in the past, so the extremely wide gap in the past year is a jarring indication of the imbalance in the housing market.

According to Teranet, most multi-property owners were gen-Xers (32 per cent) and generational households with multiple buyers (26 per cent). Millennials only made up 22 per cent of that demographic. And the sales data indicates that most people multi-property real estate in owners in Toronto are flocking towards purchasing condos as investment units since they are the more affordable option.

Beaudry reminds that investment buyers expectations for price gains are predicated on the current situation, where supply is short. He says the expectations are “becoming extrapolative, which could create “a disconnect between actual home prices and their more fundamental levels.”

At this point, most buyers seeking investment properties owners are relying on future immigration to drive Toronto real estate prices further up from their current sky-high levels. Meanwhile they’re driving those prices up themselves.

Gold rush

“Buyers beware,” says Odeen Eccleston, broker at WE Realty. We’re discussing recent trends with Toronto real estate agents selling pre-construction condos as investment properties, after a recent sales pitch I encountered.

A realtor I spoke to, who did not want to identified in this story, has been heavily marketing new sales of pre-construction condo units at the edge of eastern edge of Scarborough. Two-bedroom condos were selling for approximately $700,000, which is roughly the current market rate, though not really in that relatively untapped area.

The realtor dismissed any concerns I had about not being able to secure a big enough mortgage that would cover that unit and my current home when it would be ready to close in four years. The realtor also vaguely promised being able to secure an adequate mortgage for me or an easy re-assign, which means I could simply sell the property to a new buyer in a tight window before closing, provided there’s interest.

“Better hurry up, lay down that deposit before the opportunity is gone,” was the vibe of our conversation and the mantra for the Toronto real estate market. “We could sort out the actual finances later.”

“It makes me extremely nervous,” says Eccleston about that attitude among realtors when it comes to handling transactions worth nearly a million dollars. “A lot of times people are overly confident.”

I personally decided to opt-out. Why deal with real estate fees and taxes, while stressing that this condo unit needs to gain value at the rate that condos have been gaining value over the past few years to make that investment worthwhile. I could just purchase stocks in Lowes or Home Depot instead. If real estate is doing well, then surely those businesses must. And that investment takes much less effort and has been growing at a faster rate than real estate.

Of course, some people don’t have the stomach for stocks. Eccleston notes that she doesn’t always have the stomach for these extrapolative real estate investments, warning that counting on major price gains in the condo market is still a risk.

“At the same time, I was saying that five years ago,” says Eccleston. “I was apprehensive then as well. All of those agents pressured their clients to buy something five years ago are winning big time.”

@justsayrad

Brand Voices

Adblock test (Why?)



Source link

Continue Reading

Real eState

Canada’s Real Estate Bubble Is Getting Even More Irrational: US Federal Reserve Data – Better Dwelling

Published

 on


[unable to retrieve full-text content]

Canada’s Real Estate Bubble Is Getting Even More Irrational: US Federal Reserve Data  Better Dwelling



Source link

Continue Reading

Trending