Real eState

New York Luxury Real Estate Could Be a Bargain in 2021 – BNN

Published

4 years ago

December 23, 2020

(Bloomberg) — Judging by the last quarter of 2020, New York’s luxury real estate market should enter 2021 with confidence.

Sales of homes that cost more than $4 million were a little above those of the same three months in 2019, says Donna Olshan, president of luxury real estate broker Olshan Realty. “Now, some of that has to do with demand that was never met, because we lost the most important quarter—the spring,” she says.

But the tick upward is also, she says, “because most of these sales are [to] New Yorkers, or from the New York metro area, betting on the home team. They are getting Covid-19 discounts, they’re looking at the long-term prospects of New York, and they’re buying.”

As the city looks toward next year, the known unknowns loom large. The timeline of the vaccine rollouts is opaque. A proposed pied-à-terre tax, dreaded by everyone in the industry, remains possible. And the economic futures of the city, the country, and the world are up in the air.

But the city’s luxury residential market has enough momentum to make experts feel comfortable making some conditional predictions.

Suburb Mania Is Over

“The way I think of the suburbs is that they had their moment,” says Jonathan Miller, president and chief executive officer of Miller Samuel appraisers, who adds: “The ‘fleeing the city’ narrative is already extremely dated.”

While suburban sales are still up year over year, “it’s just no longer a rocket ship of growth,” he says. “And the jump in pricing, largely caused by what I would call panic buying—where people left the city out of fear—that was front end-loaded, and I don’t see a compelling reason why that [price growth] can be sustainable.”

John Walkup, CEO and co-founder of UrbanDigs, agrees. He says the move to the suburbs this year was really part of an older trend. “We were in year three in this shift to the suburbs picking up in demand, relative to New York City,” Walkup says.

This spring’s hysterical exodus to New York’s suburban areas was “a bit of a flash,” Walkup continues. “Prices and deal activity have spiked.”

Brooklyn Will Stay Hot

“Houses were on fire,” Olshan says. “Townhouses in Brooklyn did very well during the pandemic.”

The median price for luxury home sales in the fourth quarter in Brooklyn is expected to be up 5.5% year-over-year, according to UrbanDigs data. (“Luxury” in Brooklyn is defined by UrbanDigs as anything over $2 million.) Contracts signed are up an anticipated 26.2% for the same period, and days on the market are down by nearly half.

Overall, despite the nonexistent spring sales season, this year’s median luxury sales price in Brooklyn, according to UrbanDigs, was only down 1.5% compared to last year.

“A lot of it has to do with the lower price point,” says Walkup. “A million dollars buys you a bit more space, or a Zoom room, and once you get into that luxury sector, that value grows quite a bit.”

The demand shows no signs of abating.

“Brooklyn is certainly accelerating,” Walkup says, “and I don’t see any reason for that to stop.”

Foreign Buyers Will Keep Away

“Foreign buyers are a bit of a straw man because sometimes they’re blamed for the ups, and sometimes they’re blamed for the downs,” Walkup says.

Still, many luxury buildings—particularly condominiums along the stretch of W. 57th Street known as “Billionaires Row”—“were predominantly positioned for the foreign market, and that’s where oversupply is at its greatest,” Olshan says.

“Unless the deployment of the vaccine is very, very successful, we won’t see the foreign market back” for at least the first half of next year, she adds.

Manhattan Will Still Have Too Much of the Wrong Thing

The new luxury condominium market “is burdened with a tremendous amount of supply,” Miller says.

“In 2020 we had 8.7 years of sellout, meaning it would take 8.7 years to sell all unsold Manhattan new-development condos,” he says. That is likely to drop to 7.2 years in 2021, because there’s an anticipated “decline of new product coming into the market,” Miller says. Plus, additional sales will occur as buyers are drawn by discounted pricing, he says.

“I think in 2021 we’ll see a continued drop in price trends,” he says.

… and That Means Major Discounts

That’s a nice way of saying there could be serious deals to be found. The only question is at which buildings.

“The problem with developers is that they are held hostage to the bank or their lenders,” Olshan explains. That means that a developer can’t just price on a whim. It’s a negotiation. Whichever buildings sort out their discounts first might have the upper hand.

“These things take a long time, and you know the buyers go where the next project is. If you don’t lower your price, they’ll move on. It’s just that simple.”

The next few months, Olshan says, “are going to be remembered as the time when it was optimal to go out and strike a deal.”

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Real eState

Greater Toronto home sales jump in October after Bank of Canada rate cuts: board

Published

1 week ago

November 6, 2024

Anne Joseph

TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.

The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.

The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.

“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.

“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”

The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.

New listings last month totalled 15,328, up 4.3 per cent from a year earlier.

In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.

The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.

“I thought they’d be up for sure, but not necessarily that much,” said Forbes.

“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”

He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.

“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.

“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”

All property types saw more sales in October compared with a year ago throughout the GTA.

Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.

“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.

“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”

This report by The Canadian Press was first published Nov. 6, 2024.

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Homelessness: Tiny home village to open next week in Halifax suburb

Published

3 weeks ago

October 24, 2024

Anne Joseph

HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.

Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.

Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.

The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.

Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.

They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.

The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.

This report by The Canadian Press was first published Oct. 24, 2024.

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Here are some facts about British Columbia’s housing market

Published

4 weeks ago

October 17, 2024

Anne Joseph

Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.

Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.

Average residential home price in B.C.: $938,500

Average price in greater Vancouver (2024 year to date): $1,304,438

Average price in greater Victoria (2024 year to date): $979,103

Average price in the Okanagan (2024 year to date): $748,015

Average two-bedroom purpose-built rental in Vancouver: $2,181

Average two-bedroom purpose-built rental in Victoria: $1,839

Average two-bedroom purpose-built rental in Canada: $1,359

Rental vacancy rate in Vancouver: 0.9 per cent

How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent

This report by The Canadian Press was first published Oct. 17, 2024.

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