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Poll: Real estate prices a problem for more than half of Canadians – Toronto Sun

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Grousing (or gloating) about high real estate prices is no longer confined to Vancouver and Toronto.

Real estate prices are shooting up across the country.

As COVID hit, predictions were that real estate would fall by 18%. Instead, house prices across the country rose by 25%, starting a boom that has not subsided for the last year.

The national average home price reached a record $678,091 in February; prices are expected to rise more than 16% again this year.

The ability to work from home has changed people’s ideas about the three main rules of real estate — location, location, location — and now property prices in suburban areas, small towns, and cottage country are rising fast.

A new Angus Reid poll on home ownership and attitudes toward the housing market shows a widening chasm between the haves and the have-nots.

(And more reason to hate baby boomers.)

The housing market is prompting Canadians to take sides, with about 40% of those polled hoping real estate prices will continue to rise and around the same — 39% — hoping prices will fall.

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One in five people polled (22%) are hoping for an actual crash, with prices falling 30% or more; that this would blow up the entire economy is either lost on these people or they don’t care.

However, as the poll noted, this is an undeniable indicator “of the amount of housing pain people are experiencing coast to coast, in large communities and small.”

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Given those findings, the Angus Reid cross-Canada poll created a Housing Pain Index to illustrate what Canadians are going through, dividing people into four groups: The Happy, The Comfortable, The Uncomfortable and The Miserable.

All four groups are well represented across Canada. Income counts, but age is a more predictive indicator of a person’s placement in the Housing Pain Index than any other demographic.

The small group — 13% of the populace — known as The Happy are older, higher income, likely to own a home, and likely to have owned that home for more than 15 years.

Three quarters (73%) of that crowd no longer pays a mortgage.

The Comfortable, about 26% of the population, are also older and higher income;70% are homeowners, of which 62% have paid off their mortgage. Renters in this group say their rent is reasonable.

The Uncomfortable, interestingly enough, span every income and age group and are found in every province at around the 35% mark.

More than half own homes (60%) and more than 82% of those homeowners have a mortgage. Only half say mortgage payments are handled fairly easily.

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The Miserable, who are 24% of the population, are younger, have lower incomes, and are 42% renters. Eight in 10 who don’t own a house say they’d like one but can’t afford it.

The homeowners among them have mortgages (97%); only 10% can afford their payments easily.

Timing counts. The Happy and the Comfortable are more likely (90%) to have entered the market more than 15 years ago.

Half in the Uncomfortable or Miserable category bought in the last two to five years; that rises to 72% when one includes buyers who purchased in the last 12 months.

Sadly, at least 55% of residents canvassed in every province are either Uncomfortable or Miserable.

On average, 50% of Canadians, regardless of where they live, think housing in their area is too expensive.

Income matters, obviously, but every income level appears in each of the four Housing Pain Index categories.

About 14% of the Happy earn less than $25,000 a year, for example, while 19% of those in the Miserable bracket earn $100,000 or more and 9% earn $150,000 or more.

Canadians are united in their disdain for how officials have handled runaway real estate prices. An overwhelming majority in every province criticized their provincial government’s handling of housing affordability.

Angus Reid polled 5,004 Canadians who answered a series of questions on their current personal finances and housing situation.

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Real eState

Canadian home prices on fire and policymakers using ‘squirt gun’

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By Julie Gordon

OTTAWA (Reuters) -Buyers are turning up the heat on Canada‘s searing hot housing market, their frenzy leading to record sales, prices and starts, but in a budget unveiled on Monday the federal government did little to tamp down the fire.

The Teranet-National Bank Composite House Price Index showed home price gains accelerated 1.5% in March from February, data released on Tuesday showed.

The index was up 10.8% on the year, with a record 81% of the broader 32 markets surveyed posting annual gains above 10%. That far exceeds the last peak in 2017.

On Monday, Finance Minister Chrystia Freeland, presenting Canada‘s first budget in over two years, fleshed out a previously announced tax on foreigners parking money in Canadian homes, along with limited investments in affordable housing.

“The idea here is that homes are for Canadians to live in. They are not assets for parking offshore money,” Freeland told reporters.

For those watching, it was nowhere near enough.

“It’s like a squirt gun next to a towering inferno,” said Doug Porter, chief economist at BMO Capital Markets.

“We need to break the psychology that real estate is this can’t lose investment that only goes up,” he added. “Before this turns into a full-on bubble.”

March was a record month for new housing starts and home resale prices surged 31.6% year-over-year.

New Zealand, facing a similarly red hot market, introduced a raft of cooling measures including new taxes on investors and stricter lending rules.

While the Bank of Canada has become increasingly vocal on the issue, it has also pledged to keep interest rates at record lows into 2023. It will update its forecasts Wednesday.

And most measures that would cool the frenzy are up to the provinces and federal government who remain cautious as a third wave of COVID-19 rages.

Real estate agents say more listing are now coming to market, but they still see a massive long-term shortage. They expected more than the 35,000 units pledged in the budget.

“It’s not going to do much to intervene in the activity level we’re seeing now across the country,” said Christopher Alexander of RE/MAX Ontario-Atlantic.

(Reporting by Julie Gordon in OttawaEditing by David Gregorio and Alistair Bell)

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Canada housing starts up 21.6% in March to new record – CMHC

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Real Estate Sales In September

By Julie Gordon

OTTAWA (Reuters) – Canadian housing starts rose 21.6% in March compared with the previous month, easily beating expectations and hitting a new record, data from the Canadian Mortgage and Housing Corporation showed on Monday.

The seasonally adjusted annualized rate of housing starts rose to 335,200 units in March, well ahead of analyst expectations for 250,000 units, and a new high for all months on record.

Much of the gain was on multiple urban starts, which jumped 33.8% to 222,358 units. Single-detached urban starts rose 3.6% to 78,615 units.

“The big acceleration came as weather was unseasonably warm in many parts of the country,” Royce Mendes, senior economist at CIBC Economics, said in a note.

Mendes added that new home construction will likely be a major contributor to overall GDP growth again in 2021, even as building activity cools off from the “torrid pace” of recent months.

Canada‘s average home selling price soared an eye-watering 31.6% year-over-year in March, hitting a new high as sales also climbed to a new all-time record, the Canadian Real Estate Association (CREA) said earlier this month.

A supply imbalance has been blamed for skyrocketing home prices through the pandemic, though new listings surged in March, which, coupled with strong starts, suggests a more balanced market could be coming.

“Red-hot demand for real estate propelled a record month for housing starts in March. While the market will need a long stretch of supply growth to have a meaningful effect on prices, the March numbers are a solid start,” said Shelly Kaushik, an economist with BMO Capital Markets in a note.

Canada‘s ruling Liberals are set to unveil their first full budget in two years on Monday, with billions in pandemic supports as COVID-19 infections skyrocket, a national daycare plan and new taxes on luxury goods.

 

(Reporting by Julie Gordon in Ottawa; Editing by Toby Chopra and Jonathan Oatis)

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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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