Real eState
Survey suggests urban Canadians remain optimistic about real estate
|
|
A new survey suggests that despite high interest rates and an uncertain economy, confidence in real estate as an investment remains high among Canadians who live in large cities.
The new report was conducted by research firm Mustel Group for Sotheby’s International Realty Canada and surveyed 2,000 Canadian adults between the ages of 18 and 77 in the Vancouver, Calgary, Toronto and Montreal Census Metropolitan Areas (CMAs).
It found a high level of confidence in future real estate performance, with 60 per cent of respondents believing that a home or residential real estate purchase will perform the same or better than their other financial investments over the next 10 years.
While that figure reflects optimism about the market in the long term, the survey also found that almost half of respondents (49 per cent) believe that a home or residential real estate purchase will perform the same or better than their financial investments in the next 12 months. Nearly one in four (23 per cent) believe that it will do even better.
This despite the average price of a Toronto home declining nearly 18 per cent year-over-year in February to just under $1.1 million, according to the latest data from the Toronto Regional Real Estate Board. Back in February 2022 buyers were shelling out more than $1.3 million for the average Toronto home, prior to a series of interest rate hikes that pushed up the cost of borrowing.
“One of the most transformative and enduring social and economic outcomes of the pandemic is that Canadians now place a heightened importance on primary home ownership, not only as an investment in their lifestyle and personal security, but as an investment in their financial future,” Sotheby’s International Realty Canada President Don Kottick said in a news release. “Even though Canadians are now confronting the challenges of steep interest rate hikes, rising inflation, mounting economic uncertainty and significant housing affordability concerns, the results of the Mustel Group and Sotheby’s International Realty Canada survey reveal that confidence in our real estate market remains high, and that demand for housing and housing mobility across every generation is more pressing than ever.”
The survey also broke down generational attitudes towards real estate purchases.
It found that the COVID-19 pandemic has had the least influence on Generation X and Baby Boomers’ likelihood to buy or sell. Just over 40 per cent of respondents in that age group reported no change in their propensity to buy compared to January 2020 and roughly the same number reported no change in their likelihood to sell.
However Millennials are now less likely to sell their primary residence in the next five years compared to before the pandemic, with 32 per cent saying they are less likely to sell, compared to 21 per cent and 23 per cent amongst Generation X and Baby Boomers, respectively.
The report also found that while 36 per cent of Millennials are more likely to buy a home in the next five years compared to before the pandemic and 28 per cent report no change in likelihood, some 31 per cent of Millennials are now less likely to purchase a home.
It found 40 per cent of Generation Z adults are now more likely to buy a home in the next five years, while 33 per cent report no change in their home-buying propensity and some 33 per cent report that they are less likely to buy.
Overall, 35 per cent of respondents across all age groups said they are now more likely to buy a home in the next five years compared to January 2020, with 12 per cent now “much more likely” to buy.
The same number of respondents said they are now more likely to sell a home within the next five years, with 14 per cent now “much more likely” to sell.
In the Greater Toronto Area, the survey found “consumer confidence in Canada’s largest real estate market remains upbeat in both the short and the long-term, with a significant percentage of Toronto residents even more primed to engage in a real estate transaction than they were prior to the inception of the COVID-19 pandemic.”
The numbers in the GTA generally mirrored the findings from across the country.
“Even as sales activity and price escalation have calmed across Toronto as the region continues to absorb the effects of interest rate hikes and the pressures of dwindling housing supply, consumer demand for real estate has remained remarkably resilient,” the report said.
Figures released Wednesday showed that while home sales were down 40 per cent in February compared to a year ago, they did tick up 2.3 per cent compared to January, thanks to growth in sales in Toronto and Vancouver.
The survey was conducted online from Jan 3 to Jan 10, 2023.
While a margin of error cannot e assigned to an online survey, the margin of error on a random probability sample of a similar size would be plus or minus 2.2 percentage points, 19 times out of 20, and ranges from plus or minus 3.8 to 4.9 points for 400 – 680 respondents.
Western Investor is famous for the breadth of its commercial real estate listings. It is perhaps the only publication in Canada where investors can find a high-rise office tower, a remote waterfront lodge, a golf course, an industrial warehouse or a small-town bowling alley for sale within its pages.
We often have unique listings and there are three this month that stood out.
First is an entire city block for sale in downtown Calgary.
The 2.83-acre site borders the popular East Village, and the land is rezoned for a high-density mixed-use project with a generous floor-ratio-area (FAR) of 20.
Flexible commercial zoning allows for residential rentals, condos or hotel and a variety of commercial uses. Current visions include four high-rise towers, but all options are on the table. It is listed by Goodman Commercial, Vancouver, and NAI Commercial, Calgary, at an asking price of $32.4 million.
Second is a rare listing in B.C.’s Central Okanagan.
The property is the 11.3-acre Vibrant Wine vineyard estates in east Kelowna. The property includes a luxury 9,000-square-foot Italian-style villa. The eight-acre vineyard was named the No.1 winery on Trip Advisor and its product was ranked the Best White Wine in the World in 2013. A proven venture that can be expanded, the entire property and equipment is co-listed by HM Commercial and Jane Hoffman Realty, Kelowna, at $13.5 million.
Third of the unique listings is a productive gold mine.
With a private residence and a two-title acreage in the Cariboo, the property covers 3.2 acres near the original Gold Rush town of Likely, B.C.
The land includes an updated three-bedroom house, but the attraction is the operating gold mine. A two person operation on a five-year renewable permit that covers a 100-acre bench, only nine acres have been worked so far, but there has been a consistent average return of 1 ounce of gold per 100 yards mined, with the highest return of 8 ounces in under 100 yards. Note: the price of gold now is around US$1,980 per ounce. The entire operation, including all the mining machinery, is listed by 3A Group, Re/Max Nyda Realty in Agassiz, B.C., at $1.45 million.
Real estate experts paint a cautiously optimistic outlook after a year of downward market trends across the country.
Trends in Simcoe County show an increase in viewings and buyers re-entering the market after key interest rate hikes from the Bank of Canada warded off many last year.
Lance Chilton, the broker of record at Re/Max Hallmark Chilton Realty, calls the local market “more or less balanced.”
“Inventory conditions are the same as they once were in 2018,” he noted.” From 2020 to 2022, prices rose to about 43 per cent, which was rather rapid.”
Chilton said key interest rate hikes eventually bottomed out the local market by about September – that’s when home prices that peaked at around $1 million dropped to about $730,000.
“Since then, it’s recovered by about five per cent,” Chilton said. “In fact, we actually saw showings increase for the first time in about six months.”
The Barrie and District Association of Realtors (BDAR) confirms that showings have picked up again, with people getting that “spring fever.”
However, the one key issue that remains is low inventory.
“We saw prices dip because of interest rates and people pulling out of the market, but we never saw that supply come back online,” said Luc Woolsey, BDAR president, adding the situation creates multi-offer bids.
“So there’s still a lot of people having to come in firm, waiving conditions and inspections because they’re having to compete.”
Real eState
‘Million Dollar Listing’ star warns CA mansion tax will deliver ‘hardest hit’ to market since 2007 – Fox Business
‘Million Dollar Listing’ star and agent Josh Altman discusses the impact of California’s housing policy and homeless crisis on the state’s real estate market.
Though it’s home to some of the most luxurious and expensive real estate listings in America, California is readying to pass a housing bill that one “Million Dollar Listing” agent warned could create the “hardest hit” to the market since the 2007-08 crash.
“In about ten days or so, there’s a measure called the ULA measure that’s going to go into effect, which is going to be probably the hardest hit to the real estate market that we’ve seen since 2007,” broker and television personality Josh Altman said on “Varney & Co.” Monday.
Altman’s comments come in response to the recently-passed “United to House L.A.” (ULA) measure in California, which adopts a so-called “mansion tax” on property sales or transfers over a certain value to pay for affordable housing.
Properties sold above $5 million but below $10 million are subject to a 4% sales or transfer tax, while properties that sold for more than $10 million will face a 5.5% tax, according to the city clerk’s voter information pamphlet.
At least 92% of taxpayers’ money would “fund affordable housing under the Affordable Housing Program and tenant assistance programs under the Homeless Prevention Program,” the pamphlet also clarified.
California’s “United to House L.A.” measure will create “the hardest hit to the real estate market” since 2007, “Million Dollar Listing” star Josh Altman said on “Varney & Co.” Monday. (Getty Images)
“The way that this ULA measure was passed is just mind-boggling to me,” Altman added, “and I think it’s one of the most ridiculous bills that I have ever seen in my entire 20-year career.”
The Los Angeles city administrative officer estimated the proposed tax could generate $600 million to $1.1 billion in revenue each year. However, he noted it would “fluctuate” based on how many property transactions with values within the scope of the tax actually occur.
While those who support the measure argue it could help solve L.A.’s housing affordability and homeless crisis, others like Altman caution the tax policy would lead to higher home prices and bureaucracy.
Managing partner of 8VC Joe Lonsdale joined ‘Fox & Friends’ to discuss how the tax would affect America’s most wealthy and why the state is a ‘total mess.’
“Think about these people that bought houses three years ago for $5 million and they want to sell now,” Altman hypothesized. “The market’s down, rates are up, that happens. But now they got to cut a check for $200,000 out of their own pocket because there’s no profit on that. So it’s really going to rock the real estate market that we’re in here in Los Angeles.”
California’s real estate market, the “Million Dollar Listing” star further argued, is on “a race to the bottom” over the next 10 days as buyers try to close deals before the mansion tax is enacted.
Josh Altman of “Million Dollar Listing” warns California’s “mansion tax” will “trickle down” to working and middle-class households. (Getty Images)
“I’m seeing deals get done that should never have gotten done,” the L.A. agent said. “I’ve even done as much as, on a $28 million listing that I have, we have offered a $1,000,000 bonus for anybody who buys and closes before April 1.”
The “main issue” with the ULA measure remains its “trickle down” effect — not on mansion or luxury homeowners, but on working and middle-class California families.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Josh Altman spoke to FOX Business about the luxury real estate market and the impact of the new “mansion tax” in Los Angeles.
“People who voted who said, ‘Oh, I don’t have a $5 million house,’ which by the way, is not a mansion in L.A., we’re talking about a four-bedroom, 4,000 square-foot house in L.A. is $5 million, so this isn’t a mansion tax,” Altman said.
“This isn’t a $30, $40, $50 million house tax – these are regular people that work bill to bill, that have to pay their mortgage just like everybody else, and now they’re being penalized here.”
FOX Business’ Aislinn Murphy contributed to this report.
Nordstrom Canada: Liquidation sales to start today – CTV News
Biden issues his first veto on retirement investment resolution – CNN
‘No limits partnership’: Xi and Putin’s economic priorities – Al Jazeera English
-
News12 hours ago
Gestational diabetes is on the rise and a Canadian study may have found out why – Global News
-
Tech23 hours agoYouTuber Spends $22,000 to Buy Every Wii U and 3DS Game Ahead of Nintendo eShop Shutdown
-
Health10 hours ago
COVID-19 hair loss: Experts weigh in on PRP therapy – CTV News
-
Sports9 hours ago
NBC’s Tara Slone on speaking her mind about James Reimer: ‘We have to talk about this’ – The Athletic
-
News18 hours ago
B.C. parent launches class-action lawsuit against makers of Fortnite video game
-
Politics14 hours ago
This ain't no party, but populism is destroying our federal politics – The Hill Times
-
News18 hours ago
Canada denies role in detention, torture of former Guantanamo Bay detainee
-
Health22 hours ago
More dead birds found in Caledon could be linked to bird flu
