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Four trends that will shape Canadian real estate in 2021 – Toronto Sun

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The pandemic has changed the way we live and work

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Canadian real estate defied all expectations in 2020. Sales records were obliterated in countless local markets, despite sky-high prices not seen since the country’s 2014-2017 feeding frenzy.

But what about 2021? After an unprecedented year, will the Canadian market deliver an encore?

The answer will largely depend on four ongoing trends.

1. The urban exodus and the search for space

House in the woods

VarnaK / Shutterstock

COVID-19 triggered a tsunami of demand for larger properties among both experienced homeowners and first-time buyers. But finding adequate space at an affordable price has driven buyers into smaller exurban and rural communities where they can weather the next bout of planet-wide panic.

The flight from urban areas is likely to be the most significant trend affecting Canadian real estate in the first half of 2021. Buyers who envision a remote-work future and want more space will have little choice but to bid on properties in smaller communities where homes are generally more affordable than city centres.

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After more than a year of intermittent COVID-19 lockdowns and frustration with city life, Canadians are expected to maintain a strong desire for less crowded areas. But some economists are already questioning the future of the new remote work paradigm.

CIBC’s Benjamin Tal, the bank’s deputy chief economist, was the first prominent expert to predict the eventual end of the urban exodus. He argues it will begin losing steam when businesses decide they want their workers back in a central location.

2. The condo market will firm up — thanks to immigration

Toronto city skyline

TRphotos / Shutterstock

A desire for more space has been bad news for condo sellers, eviscerating demand and flattening price growth for much of 2020.

Things have been even worse for condo investors. The three key demographics necessary for keeping their properties tenanted and profitable — immigrants, students and travellers willing to pay high nightly rates — disappeared a year ago and have yet to return.

But the mass sell-off many feared would tank the condo markets in cities like Toronto and Vancouver has not materialized. Owners seem optimistic that a combination of COVID-19 vaccinations and the federal government’s increased immigration targets for 2021 will boost condo demand back to pre-pandemic levels.

If you own a condo in Toronto, you can find out how much your property is worth with a free home valuation.

While the country’s vaccine rollout has been the target of withering criticism, Canada already is ahead of schedule for hitting the Liberals’ target of 401,000 new permanent residents in 2021.

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Minister of Immigration Marco Mendicino told Bloomberg News that 26,600 permanent residents were admitted to the country in Jan., with another 27,332 welcomed in Feb.

3. Shrinking inventory, swelling prices

House and money on scale

pogonici / Shutterstock

When a housing boom takes place in the midst of a global recession, it’s fair to wonder if traditional real estate fundamentals mean anything at all. Unemployment skyrockets and businesses close, but people are trampling each other so they can purchase million-dollar homes.

The result has been a lack of available properties for sale. These days, the typical Canadian city is as likely to have a painful lack of housing supply as it is a Tim Hortons.

And with the aforementioned urban exodus eroding inventory in once well-stocked and slow-moving rural markets, pressure will be put on prices everywhere, not just in the country’s biggest cities.

In Bancroft, Ontario — population 4,000 — active listings fell 63.9 per cent year-over-year in Jan. to reach their lowest level in over 30 years. The average price was a “What!?”-inducing 80.9 per cent higher than it was a year before.

4. Mortgage rates on the rise

Better mortgage rates

Gutesa / Shutterstock

Driven as it’s been over the past eight months by historically low-interest rates, the strength of Canada’s housing market would seem highly sensitive — in a “Superman is sensitive to kryptonite” kind of way — to any increase in interest rates.

We’re about to find out if that’s true.

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In early March, multiple Canadian mortgage rate comparison sites reported that the lowest rate for a five-year fixed-rate mortgage rose one-quarter of 1 percentage point to 1.64 per cent, the first such increase since Jan. of last year. As the country’s major banks raise their mortgage rates, you may want to move fast to secure a favourable rate.

The increase comes at an inopportune time for recent homebuyers. Many made their purchases under the assumption that the Bank of Canada’s promise to leave interest rates low until 2023 would leave them free of any rate paranoia for the foreseeable future. Few, especially those who opted for variable-rate products, expected the cost of their mortgages to rise quite this soon.

This article was created by Wise Publishing, Inc., which provides clear, trustworthy information people can use to take control of their finances. Millions of readers throughout North America have come to count on the Toronto-based company to help them save money, find the best bank accounts, get the best mortgage rates and navigate many other financial matters.

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Real eState

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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