It has yet to be determined, if we are slowly climbing out of, or still descending further into economic misfortune. COVID-19 measures to slow down exponential viral growth in the now-pronounced second wave are here, and B.C. extended its state of emergency. Many have returned to work, but many others have no work to return to.
August 2020 saw record real estate sales locally and across the country in what can only be described as a “Land Rush.” In BC we saw a 5 per cent market increase in June, a 17 per cent year over year increase in July, and August rang out with an incredible 42.8 per cent increase from August 2019.
There was unprecedented demand for property in the interior and northern part of the province over the past two months. Great demand and small supply continues to create multiple offers on medium to lower priced housing. The British Columbia Real Estate Association reported total sales dollar volume reached $7.8 billion a 61 per cent increase over August 2019 numbers. Wow!
We have yet to see the market decline of almost 18 per cent predicted by the CMHC. If sales volumes fall between 19 per cent and 29 per cent as they predict, our housing starts and construction will also drop off taking with it our major engine of economic growth. Many market analysts and economists are predicting that this summers record-setting housing market is a huge bubble about to break. But, not everyone is convinced that this will actually happen.
The demand is so great for land and the security of property ownership, that residential markets may not be as affected as predicted. Owning equity and liquidity in a hard asset like land has been a way to prosperity for decades. The real danger of a large influx of foreclosures lies in the difficulty for lenders to continue to grant mortgages.
The Canada Emergency Rent Assistance Program (CECRA) extended coverage again for September to small businesses to apply for a 75 per cent reduction in rent which in turn allows commercial landlords to qualify for forgivable federal loans. The uncertainty of this emergency funding has again delayed the inevitable consequences of evictions due to closures and revenue losses.
We have been cautioned about our growing household debt levels that were very high even before the 2020 shutdown began. Not heeding any debt ceiling themselves, the Federal Government continues to print money and offset the economic collapse brought on by industry-killing policy and the pandemic shut down.
It could be rising government debt that is the catalyst that wipes out the entire economy and cancels out any future prosperity prospects for all generations of tax payers and retirees. Canada is only one of many countries to be printing money and handing it out as emergency capital to stave off economic collapse during the Covid crisis.
The world anxiously awaits the unknown future of the Untied States, its coming election and the faltering state of the U.S. Dollar. Discussions center around the prediction that the USD’s loss of world reserve standard status could cause global hardship. A solution that is being discussed is going back to the “Gold Standard” that was in place before 1971. The Euro, the Yaun and the Russian Ruble are all contenders to replace the U.S. Dollar unless it can be reset to its gold backed security state.
With so many unpredictable outcomes, we have to take stock of what we do know at this time. The residential real estate market is booming, demand is great and it desperately needs more inventory. A looming insolvency crisis is coming in both the residential and commercial markets and will be bringing lender-owned inventory into the supply. Our household and national debt are at all-time highs and are a compounding catalyst of this economic and global health crisis. The USD is in danger of losing its global reserve status, and global wealth is steering us toward hard asset currencies like gold and silver. Hard assets include landholdings, owning land will always bring with it security and opportunity to rise above whatever our unknown future holds.
Read the full column online at www.agassizharrisonobserver.com.
Freddy Marks, together with his daughter Linda Marks, runs Agassiz’s 3A Group Sutton Showcase Realty. He has been a Realtor in Canada and Germany for more than 30 years, and currently lives in Harrison Hot Springs.
Strong Activity Ahead for the Saskatoon Real Estate Market – RE/MAX News
As Saskatchewan’s largest city and business hub, the Saskatoon market is energized with activity. The prairies were affected by COVID-19, but quickly rebounded to strong activity – notably, Saskatchewan has outperformed last year’s market.
The city of Saskatoon had fewer cases of COVID-19 compared to other urban centers and was able to control the virus early to avoid the devastation experienced by other provinces. As a result, this market is showing promising signs of resiliency and recovery.
Here are a few market conditions that show the activity ahead in the Saskatoon real estate market:
Buying and Selling in Saskatoon
The province experienced a slight uptick in COVID-19 cases in September, but this hasn’t deterred people from participating in the Saskatchewan real estate market. In fact, there was a 52 per cent increase in sales from last September.
Activity was evident during the summer months where some REALTORS® even noted the occurrence of bidding wars and homes selling within days. June was one of the busiest months in years. This was a sure sign of market recovery following slower Spring real estate activity due to coronavirus. The market has even outperformed last year’s figures.
Despite the pandemic, buying and selling of homes waged on in this prairie province. Sale prices continue to be high, while inventory is low, showcasing that this market has seemingly recovered from the instability the coronavirus caused.
It’s important to note that home prices in Saskatoon remain steady. Homes in the city stayed on the market an average of 40 days in September, which is a 27.3 per cent decrease from 55 days last year. All of these factors point to a seller’s market in this city.
Low Interest Rates
Across the country, low interest rates will offer more Canadians the opportunity to dip their toes into the real estate market. The Bank of Canada has slashed interest rates to the lowest they’ve ever been at 0.25%. The rates are expected to stay for a while in order to bolster the economy.
Saskatoon is an attractive real estate market for young people and first-time homebuyers due to its affordability, compared to other markets across the country. For homebuyers who previously had trouble borrowing amid pervious market conditions, these accessible rates make jumping into the market a little easier.
Leveraging Technology to Get Deals Done
For those who aren’t deterred by the coronavirus and are willing to adapt to new public health measures to facilitate real estate transactions, the market conditions are prime. Technology solutions are providing the opportunity for people to scoop up their dream home in the Saskatoon market.
From virtual tours to e-signatures, there’s been a few changes to the way home sales are occurring within the current climate. Real estate agents have pulled out all the stops to ensure their clients feel safe when attending open houses and conducting business. Their dedication to innovation and commitment to putting clients first has helped keep the real estate industry afloat, despite shaky economic conditions across the country.
Can We Expect Strong Real Estate Activity Ahead?
Will demand for Saskatoon real estate be sustained into 2021? The Saskatchewan Real Estate Board does expect some of this demand to fall off as fall winds down and transitions to winter. Yet, consumer confidence continues to be high…for now.
RE/MAX brokers and agents are estimating a three-per-cent increase in average residential sale prices for the remainder of the year. Research indicates that 56% of Canadians who feel confident in the real estate market are likely to buy or sell even in the event of a second wave.
Real estate professionals are cautiously optimistic that Saskatoon will see at least average activity during the fall and winter seasons. Although, as government funding tapers off, it remains uncertain as to whether this activity will continue to be as strong. Some people may not have strong financial power to purchase homes. Yet, some industry observers suggest that the affordability of this prairie market may still attract homebuyers regardless.
Saskatoon is a fast-growing city with a buzzing real estate market that has thrived despite the COVID-19 pandemic. Although the coronavirus affected the market early on, with increased confidence and improving market conditions, Saskatoon is expecting the strong market activity to continue through the winter season.
Virtus Real Estate Investment Trust Acquires First US Based Holding – GlobeNewswire
WOODBRIDGE, Ontario, Oct. 26, 2020 (GLOBE NEWSWIRE) — Virtus Real Estate Investment Trust is pleased to announce the acquisition of its first U.S. based holding.
Virtus Real Estate Investment Trust (VREIT) has acquired a 71,760 square foot, free standing commercial building located at 1899 Cinema Drive, Olean, NY for $7,450,000 USD. The building is currently occupied by a single tenant, BJ’s Wholesale Club. BJ’s Wholesale Club recently exercised a 7 year lease extension beginning December 2019 through January 2027.
“We’re thrilled to expand Virtus REIT’s footprint with our first U.S. acquisition,” comments Virtus President Aurelio Baglione. “We are excited to add this new commercial property to our portfolio given the strong demographic profile within the area.”
About Virtus Real Estate Investment Trust
Founded in 2019, Virtus REIT offers investors the opportunity to invest in a diversified portfolio of income producing commercial, industrial, retail and multi-unit residential properties in both Canada and the United States. Virtus REIT is distributed as an alternative investment product through Virtus Capital Management Inc. To learn more about Virtus REIT and other alternative investment product offerings through Virtus Capital Management Inc., please visit virtuscapitalmgmt.com or contact firstname.lastname@example.org.
Phone Number: +1 416-930-8407
Whatever the future holds, how we use real estate will change | RENX – Real Estate News EXchange
There is a certain desperation in the air these days for evidence that speaks to any kind of return to normalcy in the near future. As I wrote last time, it promises to be a long, dark winter.
The only thing that can make it more bearable is some glimpse of light in the distance.
With this in mind, I listened in on the recent 2020 Ottawa Real Estate Forum (virtual edition). It featured a lot of talk, but not many facts to hang your hat on.
Other articles on the RENX site offer a recap of the Forum’s highpoints, so I won’t repeat them here, beyond the following:
* A hybrid model of work from home and work from the traditional office is likely to prevail versus one becoming overly dominant at the expense of the other;
* The pandemic (as I have noted before) is not a harbinger of doom for most segments of commercial real estate. Rather, it is an accelerant for those paradigm shifts that were already underway – such as the federal government already looking to reduce its real estate footprint across the country by about 25 per cent over the next couple of decades;
* Issues previously present in a large urban market, such as Ottawa’s pressing need for new residential rental stock, haven’t disappeared and will remain a factor. The fix for the issue, however, may now take a modified form thanks to the pandemic-driven shifts in how people will choose to live and work.
I don’t profess to have a crystal ball, but if these conclusions prove true, I see the following consequences:
Middle managers redundant?:
Those management types who like to keep a constant eye on everyone haven’t been able to do so with remote working.
We’ve had more than enough time now to gauge the true impact on productivity, creativity and team cohesion of a dispersed team. It works well for some and not so for others.
Why? There are two reasons – how any one person’s brain is wired and what type of work they do.
What the surge in remote working may prove for many workplaces is that if you have in place a proper workflow and communications structure and performance metrics (to flag underachievers), along with competent people in the right positions, middle management may prove to be an unnecessary layer of the org chart that just doesn’t add much value for the money.
Demand for more flexible housing designs:
Working from home from the kitchen table or the edge of the bed loses its lustre rather quickly, particularly if the kids are attending school remotely.
Families need the flexibility of a housing design that may offer two segregated spaces for a proper home office, without having to purchase a home of 4,000 square feet or more to get it.
Upward pressure on salaries:
But even so, incorporating this additional space into a design will still mean a somewhat larger home than what a family would have normally required if the breadwinners worked away from home at an office. Larger homes, of course, cost more.
This may mean that remote workers may come to demand higher salaries and jump ship as needed to find an employer willing to accommodate.
Standard office designs will no longer cut it:
The recent trend of packing more people into a smaller footprint likely will be at an end. Either because it’s a government-mandated requirement or because people will demand it, there will have to be more square footage assigned to an individual.
If a large proportion of the workforce is working from home full-time or even part-time, this may not be a problem.
But . . . people will have new expectations and awareness around personal hygiene now, too. They say it only takes about 30 days to develop a new habit and we are now seven months and counting into the pandemic.
This means things like the traditional office bathroom design may have to go.
Demand for more space between sinks and urinals, and the replacement of standard entry doors with the kind of barrier-free entrances we see in airport and shopping mall bathrooms, may become the norm. All this will increase space requirements and demand a reno.
What the dollars and cents say
Regardless of what the next year or two holds for us, this much is certain – people continue to buy, sell and invest in real estate.
This is a highly speculative industry, after all, driven by two things – most of our lives are spent under one kind of roof or another, and how we design and use space has never remained the same.
I track commercial transaction data in Ontario and the numbers continue to suggest resilient levels of activity. Looking at transactions worth $10 million or more, we have seen 261 transactions across the province from the beginning of March 2020, versus 353 in the same period in 2019.
The total dollar value of these transactions is down almost 18 per cent – from about $10.6 billion to $8.7 billion. While there has been a decline, there are still transactions taking place.
Meanwhile, fuelled in part by bargain basement interest rates, housing markets in many regions continue to be on a tear. Ottawa is a prime example.
Some anecdotal reports attribute this to a flight to safety, as people flee the urban core for the perceived safety of more space in the ‘burbs or even adjacent rural areas – why continue to live in a congested city if you’re going to be working from home?
This may account for some of the activity and price inflation we have seen in, for example, Ottawa and nearby rural communities. But, it by no means accounts for all of it – bidding wars on properties are happening even in old central urban neighbourhoods like mine.
It remains to be seen how sustainable these current spikes and patterns in residential resale activity will be, but these price increases are not just in the large cities. In recent data from across the country, the greatest percentage increases were in New Brunswick.
Whether it’s the commercial or the residential end of things, we can only continue to wait and see and let the markets speak for themselves.
To discuss this or any valuation topic in the context of your property, please contact me at email@example.com. I am always interested in your feedback and suggestions for future articles.
MagSafe Charger Only Charges at Full 15W Speeds With Apple's 20W Power Adapter – MacRumors
Canadian Press NewsAlert: Quebec reaches more than 100,000 total cases of COVID-19 – TimminsToday
City Launches Investment Map To Show Where Money Is Being Spent – windsoriteDOTca News
Silver investment demand jumped 12% in 2019
Iran anticipates renewed protests amid social media shutdown
Galaxy M31 July 2020 security update brings Glance, a content-driven lockscreen wallpaper service
- Business15 hours ago
Owner of all-electric Nissan Leaf frustrated by difficulty of getting new battery – CBC.ca
- Tech23 hours ago
Apple Issues New iPhone 12 Upgrade Warning – Forbes
- Politics24 hours ago
Students learn provincial politics in mock vote at Saskatchewan schools – Global News
- Economy20 hours ago
An innovative economy requires an innovative government – The Hill Times
- Tech24 hours ago
iFixit teardown confirms the iPhone 12 and 12 Pro are mostly identical – Mashable
- Business24 hours ago
Job losses to come in wake of Cenovus-Husky transaction, but scale unknown – Calgary Herald
- Politics20 hours ago
Commons showdown highlights tension between politics and science – The Battlefords News-Optimist
- Science15 hours ago
NASA Spacecraft Osiris-Rex Extracts Samples From Asteroid Bennu, a First for US – The Daily Beast