Preconstruction buyers face hard truths, the Home of the Week and more top real estate stories - The Globe and Mail | Canada News Media
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Preconstruction buyers face hard truths, the Home of the Week and more top real estate stories – The Globe and Mail

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Home of the Week, 70A Hillside Dr., Toronto.Lukas Peters Photography

Here are The Globe and Mail’s top housing and real estate stories this week and one home worth a look.

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Ottawa announces $1.5-billion in funding for rental builds, $100-million for new construction technology

In the latest in a series of housing pledges ahead of the federal budget, the Trudeau government is launching a $1.5-billion fund to acquire existing apartment buildings, write Rachelle Younglai and Erin Anderssen. The Canada Rental Protection Fund is designed to save thousands of rental units from being sold and turned into higher-priced market units at a time when the cost of housing is far out of reach for low-income Canadian residents. Ottawa has also pledged $100-million towards supporting new and existing home building projects that focus on new materials and methods to construct new housing in the country. The Trudeau government has been under pressure to improve Canada’s increasingly unaffordable housing market.

Home prices could reach peak levels by next year, set new highs in 2026, CMHC report shows

The Canada Mortgage and Housing Corp. forecasts that despite an increase in rental housing coming on the market in 2023, supply is not forecast to keep up with demand, leading to higher rents and lower vacancy rates in the coming years. According to the report, affordability in the home ownership market will also be a concern for the next three years, as declining mortgage rates and the country’s strongest population growth since the 1950s will likely spur a rebound in home sales and prices.

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Photos and AI renderings of 194R Chatham Ave., Toronto.Re/Max Hallmark Realty Ltd.

In some real estate listings, AI renderings make it hard to distinguish what’s real

A Toronto real estate listing with fantastical renderings generated by artificial intelligence has raised questions about what the limits are for digital photo manipulation, writes Shane Dingman. There were 21 photos in the original listing for the single storey Toronto garage: six show the actual building in its current state of bare brick and wood under peeling paint, and 15 show elaborate renderings depicting it as a residential or commercial space, generated by AI. Some images invent new spaces – pushing out the walls to create nooks for furniture – while others replace wooden rafters with steel beams and frankly an absurd amount of ductwork. The issue is when does “virtual” start to become misleading? Though Ontario real estate policy requires professionals to avoid misrepresenting a property, the meaning of the policy is often left to interpretation.

Rob Carrick: Retirees in debt have found an expensive way to get relief

An upstart player in reverse mortgages has a novel idea for broadening its business – give people credit card-style convenience in tapping their home equity, writes personal finance columnist Rob Carrick. The Bloom Home Equity Prepaid Mastercard from Bloom Finance Co. is designed for people who want to occasionally supplement their household income. Pay for something with the card and the amount is added to your reverse mortgage. The cost of this convenience is substantial. While there are no monthly payments on a reverse mortgage, a hefty interest bill quietly accumulates in the background and must be paid along with the principal when you sell.

A hard truth for real estate preconstruction buyers, as values haven’t caught up to expectations

Preconstruction purchasers of houses and condo units are facing the challenge of closing on a deal they signed when the real estate market was on a high and mortgage rates were at historic lows, writes Carolyn Ireland. While sales of condo units on the resale market have perked up in recent weeks, woes continue for buyers who bought preconstruction in the heady days between 2020 and 2022. Some are home buyers who struggle to line up the financing they need, while others are investors who are reluctant to take ownership of a property only to sell it at a significant loss. In certain cases, experts say, the market had soured to the point where the original buyer is willing to walk away from a deposit, and builders are then trying to find a new buyer.

Home of the week: A home of retreats, both outdoor and underwater

  • Home of the Week, 70A Hillside Dr., TorontoLukas Peters Photography

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70A Hillside Dr. N., Toronto

This three-bedroom home at the edge of Toronto’s Don Valley was built with energy-efficiency in mind. Built in 2019 by the previous owner, who owns a company that specializes in water-based heating tech, the home features water heating throughout the floors, driveway, and garage. Most of the main level is styled in brilliant white or light grey, with an ultra-modern kitchen stocked with brushed metal appliances. The property has its own unique elements as well, including a glass-enclosed elevator and a huge, 30,000-litre freshwater aquarium — though it has never had fish. The best feature is the rooftop terrace, split between a glassed-in solarium and an open air deck, with sweeping views of the Don Valley.

What do you think is the asking price for the property?

a. $3,999,000

b. $4,125,000

c. $4,750,000

d. $5,333,000

b. The asking price is $4,125,000.

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

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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

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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

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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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