TORONTO — The Ontario Real Estate Association is asking agents to halt plans for open houses, as the province reports a record high of 939 new COVID-19 cases on Friday.
Open houses resumed in mid-July as part of the province’s Stage 3 reopening plan, which at the time allowed gatherings of 50 people, or 30-per-cent capacity, with physical distancing enforced.
On Friday, the province announced a modified return to Stage 2 COVID-19 restrictions, which would limit open houses to 10 people.
Real estate association president Sean Morrison says that notwithstanding the 10-person limit, he encourages members to shift open showings virtually.
Morrison says agents and brokers can still follow safety precautions for private showings, which involve less risk than an afternoon drop-in model.
After earlier calling for a government moratorium on open houses, Morrison says he is reviewing whether the 10-person limit is adequate.
This report by The Canadian Press was first published Oct. 9, 2020.
The Canadian Press
Vancouver posts Canada’s lowest commercial property tax rate – Business in Vancouver
Altus Group 2020 Canadian Property Tax Rate Benchmark Report.
The City of Vancouver now has the lowest tax rate for commercial property among major Canadian cities, but Vancouver has shifted the burden to residential real estate, creating the most heavily-taxed homeowners in the country.
With a decrease of 27.9% from 2010, Vancouver posted the largest drop in commercial rates out of 11 cities surveyed by the Altus Group for its 2020 Canadian Property Tax Rate Benchmark Report, released October 26. The 17th annual survey was done in conjunction with the Real Property Association of Canada.
The tax shift is measured by a commercial-to-residential ratio that compares the commercial tax rate to the residential tax rate. For example, if the ratio is 2.50, a commercial property valued at $1 million dollars would incur property taxes 2.5 times higher than an equally-valued residential property.
Because of the pandemic, many cities have shifted the tax burden away from businesses, which resulted in a decrease of the commercial-to-residential tax ratios in 2020.
But Vancouver was particularly aggressive.
Vancouver’s commercial-to-residential tax ratio dropped 36.84% in 2020 from a year earlier to a historic low of 2.3. This was the largest decline of all cities surveyed, Altus found. This decrease took Vancouver from the third highest ratio in 2019 to the fourth lowest in 2020.
In comparison, the average national commercial-to-residential tax ratio in Canada is now 2.65, down 6.6% from 2019.
“[This] marks the fifteenth year in a row that Vancouver’s commercial rates have gone down. Over the last five years, Vancouver’s commercial tax per $1,000 of assessment has dropped 55.3%, going from $15.05 in 2015 to $6.73 in 2020,” Altus reported.
The city cannot take full credit for the dramatic cut in commercial taxes. The drop was driven in large part by a B.C. government decision in April to reduce the school tax portion of the commercial tax mill rate (tax per $1,000 of value) by 70% this year as part of its COVID-19 Action Plan.
The tax shift has dinged owners of homes, which remain the highest priced in the country.
Vancouver posted the largest increase in residential tax rates in Canada this year, with a 14.2% increase from 2019, the Altus report reveals. This moved the city’s mill rate on a median residential unit to approximately 2.92 this year, from approximately 2.56 in 2019. This increase adds $131 more in property taxes for a median priced home of $1.2 million, according to the City of Vancouver.
Real estate sales set new mark in Powell River – Powell River Peak
Residential real estate sales in the Powell River region for September 2020 were significantly higher than the value of sales from September 2019, setting a new record in the process.
In September 2020, there were 50 single-family homes sold, for a value of $23,051,740, compared to 15 in September 2019, valued at $6,946,300.
According to statistics, a new sales record for the month of September was reached in Powell River and it was the third highest sales figures for any month on record in the region.
“Home sales in the region continued to rebound in September, hitting the third highest level for any month on record,” said Neil Frost, president, Powell River Sunshine Coast Real Estate Board. “New supply also hit a new record level for the month of September but is not keeping pace with the strong demand we are experiencing. As a result, the market continues to tighten significantly and the imbalance between supply and demand is putting upward pressure on prices in the region.”
For single-family mobiles and manufactured homes, in September 2020, there were three units sold, valued at $765,369, compared to three units valued at $594,000 in September 2019.
In the single-family condos, apartment and duplexes category, there were three units sold in September 2020, valued at $823,500, compared to four units sold in September 2019, valued at $935,500.
Total residential sales for September 2020 were valued at $24,640,609 for 56 units, compared to $8,475,800 for 22 units in September 2019.
On the non-residential side, there were five parcels of vacant land valued at $797,000 sold in September 2020, compared to one, valued at $84,000, in September 2019. There was also one industrial, commercial and institutional property sold in September 2019, valued at $300,000, compared to none in September 2020.
Grand totals show 61 total sales in September 2020, valued at $25,437,609, compared to 24 sales, valued at $8,859,800 in September 2019.
The average price of a single-family home in September 2020 was $461,035, compared to $463,087 in September 2019. The median price of a home in September 2020 was $470,000, compared to $344,000 in September 2019.
While the average price of homes sold in September 2020 was $461.035, Frost said the more comprehensive year-to-date average price was $414,794; rising 16.5 per cent from the first nine months of 2019.
There were 75 new residential listings in September 2020. This was the largest number of new listings added in the month of September in history.
Active residential listings numbered 101 units at the end of September.
While month-end figures are not yet available, Frost said Powell River sales figures for October are strong. As of October 26, 2020, there had been 50 sales in the Powell River area, compared to 26 in 2019.
In terms of year-to-date figures, as of October 26, Frost said the 2020 figure sits at 375 sales, compared to 311 over the same period in 2019.
“When we started out, we didn’t think we were going to touch 2019 because we had a couple of dead months, then we started to catch up, were on par, and now we are ahead,” said Frost. “We definitely had our strongest September and it was our strongest month in a long time. It was a banner month.”
Will Canadian Real Estate Prices Cool This Winter? – RE/MAX News
The COVID-19 pandemic shook the Canadian (and global) economy, causing business closures and job losses across many industries. But the public health crisis has failed to drive a stake through the Canadian real estate market – so far. Despite a slowdown at the height of the pandemic earlier this year, the nation’s housing sector has enjoyed a record-setting recovery from coast to coast, thanks in part to a combination of tech-savvy real estate agents, low interest rates and high demand. Although homebuyer trends are evolving, major urban centres and small towns are experiencing booming sales activity and rising prices.
With winter on the horizon, can the housing market maintain its upward trajectory? Some believe that pent-up demand has likely been exhausted, but that real estate prices will continue to edge higher across the country. What does the data say? Let’s explore some of the latest analysis and numbers to see what has been occurring in the broader Canadian real estate market, and what trends may emerge as we approach 2021.
Will Canadian Real Estate Prices Cool This Winter?
The Federal Reserve Bank of Dallas recently published a report analyzing the real estate markets in the Group of Seven countries during the second quarter. Researchers revealed that Canadian residential real estate prices reported the biggest jump in the G7, rising 2.42 per cent from the previous quarter. The next closest in G7 is France, rising 1.71 per cent. This occurred despite soaring vacancy rates and very little immigration during the April-to-June period.
It is remarkable to see how much home valuations have increased and how sales have popped during an unprecedented public health crisis. Here are just some of the August 2020 average sales prices and the year-over-year growth based on Canadian housing market data:
- Greater Toronto Area: $890,400 (+11.1%)
- Greater Vancouver Area: $1,038,700 (+5.3%)
- Ottawa: $517,800 (+19.9%)
- Greater Montreal Area: $408,200 (+16.4%)
- Halifax: $372,982 (+18.1%)
The unforeseen developments of 2020 may have stumped market watchers, but the upward trends make sense since a key factor helping in the recovery of the national real estate market has been an inventory shortage that surfaced long before COVID-19 reared its head in Canada. According to the Canadian Real Estate Association (CREA), inventory levels fell to an all-time low of 2.6 months in August. This is the length of time it would take to liquidate the current stock of listings at the current sales rate.
Can Canada sustain this momentum heading into winter and 2021? RBC Economics recently published a report that suggested pent-up demand has been exhausted, which could mean the Canadian real estate market will lose some of this fierce momentum in the months to come. Despite the possibility of a slow down, the report suggests that prices will continue to climb.
“With pent-up demand now largely exhausted, we see activity cooling later this fall,” economist Robert Hogue wrote. “The pent-up demand created this spring proved a powerful driver of activity. Question is: how much longer can it be such a dominant factor? We think there’s probably little pent-up demand left to satisfy in most markets.”
The expectation for higher prices is in line with the RE/MAX Fall Market Outlook Report, which forecasted a continuation of growth in valuations and activity in most housing markets. But why? The Canadian real estate market has plenty of growth factors working in its favour:
- Interest rates are at an all-time low.
- Real estate agents are still utilizing virtual tools to facilitate transactions.
- Some levels of pent-up demand continue to linger in the background.
- The federal government has made it clear that it would not allow any substantial downturn in the industry.
Where to Buy in Canada
Whether homebuyers’ sights are set upon Atlantic Canada, the Greater Toronto Area, the Prairies of the West Coast, the Canadian real estate market is ripe with a wide range of opportunities for both new homebuyers and homeowners looking to upgrade. Now that more people are working remotely, many professionals are no longer confined to living within close proximity to their workplace, which is opening up a wave of growth everywhere – namely within small suburban or rural municipalities.
The Bank of Canada (BoC), which is anticipated to maintain an accommodative monetary policy for a few more years, projects that the road to recovery will be a long one. Despite the remaining roadblocks within the economy, including business closures and widespread job loss, the real estate sector is booming, suggesting that any significant price cooling activity is unlikely to correlate with Canada’s cooling temperatures. When it comes to the national real estate market, all signs point to a hot winter market ahead.
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