When Stephanie Hunter and Braden Bonwick were searching for a house in the Niagara region, they were given a brief opportunity to view the properties and were advised to provide a cover letter and photo of themselves as they competed with dozens of buyers for homes that were selling for $100,000 over the asking price.
“It felt like we were playing a game of chance,” Ms. Hunter said. “You have 15 minutes to look at a place while a line of agents and their clients is forming outside the front door asking if you’re almost done. Then finding out the home you just had 15 minutes to look at had 65 viewings that day and all offers have to be in by 5 p.m. tomorrow.”
Welcome to the small city housing frenzy, where Toronto and Vancouver real estate tactics have become the norm. There are no home inspections and no conditional offers – and bids are routinely well over asking.
Since the pandemic began, buyers have sought more room for their home offices, entertainment and living. That has sent prices soaring and prompted recent warnings of real estate bubbles in areas well outside Toronto – not surburbs, but places that are 1.5 to two hours from downtown Toronto and have never experienced an overheated real estate market or at least one this hot. Niagara, Barrie, Tillsonburg, Woodstock, Ingersoll, Prince Edward County, Kawartha Lakes, Grey-Bruce Owen Sound and other smaller markets in Ontario have seen home prices climb more than 30 per cent.
“At first, everybody was excited because anybody looking to move up could sell their house and they made a pretty penny,” said Jim Diodati, the mayor of Niagara Falls. “Until they realized you make more money when you sell, [but] you are also going to pay more money when you buy.”
Now, smaller cities are increasingly grappling with the same problems created by skyrocketing real estate prices – unaffordability and housing inequity – that have plagued Toronto and Vancouver for decades.
“Appreciating real estate values show that you have a desirable market. On the other end, it is becoming unaffordable for people trying to enter the market,” said Mr. Diodati, who worries about housing for younger generations. “We are asking ourselves: Is this going to be an obstacle that they cannot get past? Are we committing our kids to renting for a long, long time?”
Barrie Mayor Jeff Lehman said his city is facing the same issues: “Not being able to afford housing – that is a problem in a number of places in Canada and it is a growing problem here.”
The benchmark price of a detached house in Barrie reached $721,000 in February. That was almost $100,000 more than three months ago and about $200,000 more than a year ago, according to Canadian Real Estate Association data. Three years ago, the price of a detached house in the city was less than $500,000; five years ago, it was less than $400,000.
Barrie, which is a 1.5-hour train ride from downtown Toronto, is also now one of the country’s priciest rental markets. The average monthly rent for a two-bedroom apartment was $1,393 last fall, according to the latest data from Canada Mortgage and Housing Corp. That puts Barrie fifth, behind Toronto, Vancouver, Ottawa and Victoria.
“I am definitely concerned about this. We had an affordable housing crisis before this happened,” Mr. Lehman said, adding that lower-income workers had to move farther out of the city even before the recent surge in real estate prices.
The same run-up in prices has happened elsewhere in the past few months. Detached houses in Kitchener-Waterloo, Burlington and Mississauga have gone up by a minimum of $100,000 over three months. In Milton and Oakville, prices are almost $200,000 more than they were in November.
The average price of a house in Hamilton, a commuter city that used to be considered affordable, is almost $800,000.
In Prince Edward County, a popular vacation area for Torontonians and Quebeckers, a local realtor says prices have become disconnected from reality. Treat Hull, who has sold properties in the county for almost a decade, said his region is in a real estate bubble. “I am really worried that we’re heading for a train wreck à la Toronto in 1990. I hope I am wrong,” he said.
Even places such as Owen Sound and Niagara Falls, which have had depressed prices for decades, have seen a flood of Toronto-region buyers looking for more room and access to nature. “A lot of people in big cities are reimagining their way of life,” said Owen Sound Mayor Ian Boddy, who agrees with the other mayors that higher prices are a double-edged sword.
That was the case for Ms. Hunter and Mr. Bonwick. After 17 years of living in Toronto, they were sick of renting small, gardenless spaces and tired of the expenses that accompany city living. The couple, in their late 30s, envisioned buying their first house in St. Catharines, where they both grew up.
“Braden and I imagined we’d move back and find the perfect starter home. How difficult can that be? Ha ha,” Ms. Hunter said. The longer they looked, the pricier homes got. They turned to Niagara Falls after being priced out of St. Catharines.
Ms. Hunter said the process was “frustrating, discouraging and upsetting.”
“You have to decide quickly if you both liked it and then try to figure out what kind of number you want to throw out there in hopes that they’ll pick you, while trying not to become house poor. Then you sit and wait, only to hear they went with an offer that came in $100,000 over asking,” she said.
The couple made offers on five properties and competed against 15 to 25 buyers each time. They finally found a house in Niagara Falls for less than $450,000 and said their offer with no conditions put them ahead of the pack.
Source: – The Globe and Mail
PGIM Real Estate, Revera Affiliate Target UK Market in Newly Formed JV
PGIM Real Estate has been active in recent months providing capital to facilitate blockbuster senior housing acquisitions. Now the firm is looking to capitalize on demand for senior housing in the United Kingdom.
The Madison, New Jersey-based real estate investor and lender announced this week it is entering into a joint venture with Signature Senior Lifestyle, an affiliate of Revera, to develop and operate senior housing communities around greater London
Mississauga, Ontario-based Revera serves 20,000 older adults in long-term care homes and retirement residences in Canada. It is also the majority shareholder of Sunrise Senior Living, one of the largest senior housing providers in the U.S. The company operates a portfolio of 12 communities in the U.K. under the Signature Senior Lifestyle brand, with one community in development that is slated to open in autumn 2021.
The JV has one development underway — a senior housing community, or “prime care” home, in southwest London. PGIM worked with Elevation Partners, a London-based investor and asset manager in U.K. health care real estate, in sourcing, structuring and executing the venture. Additionally, PGIM will retain the firm to leverage its expertise.
PGIM and Revera did not respond to requests for comment from Senior Housing News regarding details about its development pipeline.
London is emerging as a future hotbed of senior housing development, spurred by favorable demographic growth trends and a lack of available supply, and the PGIM-Revera venture will find competition.
Maplewood Senior Living CEO Gregory Smith told SHN last month that demand for U.K. senior housing is comparable to major U.S. markets such as New York and San Francisco, where supply has historically been constrained.
Maplewood and its investment partner, Omega Healthcare Investors (NYSE: OHI) are looking to expand its luxury Inspir brand to the U.K., and identified five suburban markets around London with high barriers to entry that are favorable for the brand’s growth.
Revera CEO Tom Wellner sees similar untapped upside potential for senior housing in the U.K.
Source: – Senior Housing News
Where in Canada are house prices increasing the most? Maybe not where you think – CTV News
Canada saw a surge in housing prices over the past year due to COVID-19, a market trend experts say is caused by people working from home more often and moving to rural and suburban areas.
Data released by the Canadian Real Estate Association (CREA) shows that when comparing the average market prices from February 2020 to February 2021, Canada had a 25 per cent year-over-year increase. The average price rose from $542,484 to $678,091.
“One factor is that with work-from-home even more generalized, many people don’t have to live within commuting distance from their jobs,” Shaun Cathcart, senior economist at CREA, told CTVNews.ca. “That means that folks who own condos and smaller homes can take out built-up equity and move to a property that better meets their needs – as over the past year, home is not only where you eat a few meals and sleep, but also the office, your kids’ school, playground, gym, etc.”
The largest year-over-year percentage changes came from the Northwest Territories (48.1%), Nova Scotia (30.4%), Ontario (24.5%), Quebec (22.5%), and New Brunswick (20.9%).
Cathcart noted that the higher percentage change in Northwest Territories is likely due to the fact that in both February 2020 and February 2021, six homes were sold throughout the entire territory and the ones that were sold in 2021 were marked at a higher price.
When looking at the provinces and territories that had the largest upsurge in terms of price difference, Ontario sits at the top of the list with an increase of over $170,000. Northwest Territories came next, followed by British Columbia, Nova Scotia, and Quebec.
The data also shows that prices in suburban and rural areas were impacted the most and saw the biggest changes, with regions like Rideau-St. Lawrence and Sarnia-Lambton in Ontario averaging about a 50 per cent increase from the previous year.
“With people no longer having to live within commuting distance to their jobs, as long as suburban and rural areas have decent internet, they become even more attractive to families looking for more space,” said Cathcart.
Find your region and the year-over-year price and percentage change below.
Cathcart says that Canadians can expect to see sales and prices increase this year, but forecasts sales to slow down in 2022 while prices remain high.
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