TORONTO — MortgageCalculator.ca is the industry’s leading Financial Planning Tool that is designed to help real estate buyers compare current mortgage rates of multiple Canadian financial institutions.
Sam Kamra, a Realtor, private lender and a co-founder of MortgageCalculator.ca, shares his insights on the Coronavirus and its potential impact on Real Estate in Canada.
Coronavirus, the deadly disease is spreading its wings and leaving a scary mark in various nations across the globe. For China, the epicenter of this respiratory virus outbreak, it’s nothing less than a big nightmare.
With over 7700 confirmed cases of the mysterious new illness, more than 170 people already dead in China (around 2% death rate), and several cases reported in 20 different countries, the Wuhan virus has become a serious point of concern everywhere.
But, other than severe health risks, is there something you need to worry about economically and financially? As a potential Real Estate investor, you have to be conscious of any ripple effects that could affect your buying and selling decisions.
Chinese Investments Worldwide: Past Facts
Chinese investors actively expanded their overseas footprints by investing both in commercial and residential real estate. As per a survey conducted in 2018, more than 1/3rd of Chinese millionaires considered emigrating to US and Canada amongst other locations.
Facts state; the total Chinese investment in international properties zoomed from $5 billion in 2010 to a massive USD 119.7 billion in 2017. A great spike in the foreign investments flowing from China to other nations! Political resistances and foreign taxes added certain limitations and dipped the overall figures in 2018-19. However, it could not suppress the ever-growing desire of investors to own luxury homes and other attractive properties in North America.
And, Canada has been one of the topmost investment destinations, a hotspot for Chinese immigrants and wealthy investors.
For a better education, healthier environment, and lifestyle – pouring of money from Asia into Canadian properties has surely driven real estate growth. Undoubtedly, the frenzy buying habits of rich Chinese investors boosted Canadian housing prices to unbelievable new heights.
A Reality Check for Canada
A noteworthy increase in foreign buyers (especially from China) has been observed in the past decade or so. Hence, it gets really important to weight the impact of this contagious Coronavirus wave on the housing markets in Canada.
With only 2 confirmed cases in Toronto, the situation seems to be under control in Canada. Keeping our fingers crossed, hoping everything is going to be managed perfectly! If Canada succeeds to evade this major pandemic, a transitory period of insecurity and panic, its economy can bear the hard blows, if any.
Looking at a 2015 study from the non-profit organization Berkeley Earth that estimated 1.6 million people in China die each year from heart, lung and stroke problems because of polluted air, current epidemic death toll rates don’t seem to be that dangerous, at least as of right now.
With the mounting fears of Coronavirus in China, it’s obvious for more people willing to shift and settle elsewhere. Once the situation normalizes, will that bring another era of inflation in Canadian Real Estate?
The Real Impact
The immense disruption of travel, business activities, locking down of numerous cities, and stagnant life in China has raised some global risks and concerns. Canadian officials say that “The risk of outbreak in Canada remains low” and they take all preventative measures to stop the virus. There are already multiple systems in place, which can detect and respond, in order to prevent the spread of Coronavirus.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
