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Technology, data, starting to transform commercial real estate: survey – Toronto Star

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TORONTO – A new report says technology and data are finally shaking up the world of commercial real estate, allowing the industry to make more informed decisions and take on more complex projects.

Toronto-based Altus Group says a majority of 400 global commercial real estate executives surveyed are now seeing the disruptive impact of technology on the property sector for the first time in the five years the real estate group has been conducting the survey.

Altus CEO Bob Courteau says executives are starting to see that data, innovation and technology are going to be critical going forward, after some reluctance in the past to invest in areas beyond the bricks and mortar of real estate.

The change is clear at the executive level, where 80 per cent of firms said they have a chief data officer or equivalent senior executive, compared with only 44 per cent four years ago.

The increased data and efficiencies brought on by technology are allowing real estate firms to expand into growing spaces such as multi-family co-living, a sort of dorm-style arrangement with small private bedrooms and shared living and kitchen space, as well as co-working space and new models for retail.

Altus says a wave of investment in startups focused on real estate tech, or proptech, has created a huge number of players and the sector is ripe for consolidation.

This report by The Canadian Press was first published Jan. 27, 2020.

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Technology, data, starting to transform commercial real estate: survey – CityNews Edmonton

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TORONTO — A new report says technology and data are finally shaking up the world of commercial real estate, allowing the industry to make more informed decisions and take on more complex projects.

Toronto-based Altus Group says a majority of 400 global commercial real estate executives surveyed are now seeing the disruptive impact of technology on the property sector for the first time in the five years the real estate group has been conducting the survey.

Altus CEO Bob Courteau says executives are starting to see that data, innovation and technology are going to be critical going forward, after some reluctance in the past to invest in areas beyond the bricks and mortar of real estate.

The change is clear at the executive level, where 80 per cent of firms said they have a chief data officer or equivalent senior executive, compared with only 44 per cent four years ago.

The increased data and efficiencies brought on by technology are allowing real estate firms to expand into growing spaces such as multi-family co-living, a sort of dorm-style arrangement with small private bedrooms and shared living and kitchen space, as well as co-working space and new models for retail.

Altus says a wave of investment in startups focused on real estate tech, or proptech, has created a huge number of players and the sector is ripe for consolidation.

This report by The Canadian Press was first published Jan. 27, 2020.

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'Proptech' is finally disrupting the world of commercial real estate – Times Colonist

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Technology and data are finally shaking up the world of commercial real estate, allowing the industry to make more informed decisions, respond quicker to consumer trends, and take on more complex projects, says consultancy Altus Group.

The Toronto-based real estate firm said Monday that for the first time, a majority of 400 global commercial real estate executives polled said they are seeing the disruptive impact of technology on the sector.

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The shift comes as the wave of investment and startups in recent years are starting to show results and shift perspectives, said Altus CEO Bob Courteau.

“There’s a bunch of really aggressive companies that came in to real estate globally, and they came in with a whole different view of the importance of data and technology.”

New companies, and new executives at existing ones, have caused a significant shift in thinking on the role in technology in the space, he said.

“The orientation of the management teams of historical commercial real estate was to put their investments in the ground, not into things like data and technology.”

The change is stark at the executive level, where 80 per cent of 350 firms surveyed now say they have a chief data officer or equivalent senior executive, compared with only 44 per cent four years ago.

“The last couple or three (years) has seen an explosion in change,” said Courteau.

WeWork may be the most well-known company in the space, but new entrants number in the thousands, by some estimates.

Real Estate giant Brookfield Asset Management, through their venture arm Brookfield Technology Partners, has recently invested in companies such as leasing software provider VTS, automated door hardware provider Latch, and contractor software provider Building Connect.

Meanwhile, real estate service provider Jones Lang LaSalle IP, Inc. launched a US$100 million venture fund in 2018 to invest in the property technology, or “proptech” space, joining an increasingly crowded field.

In Canada, the tech sector has seen numerous startups enter the space including Yuhu, which offers software for building managers, Breather, an on-demand office space provider, Lane, a mobile-focused tool for tenants, and MapYourProperty, which provides analytics for land development.

Early proptech entrants were focused more on efficiencies, like lower energy costs or automating repetitive tasks, but with the wealth of data available there’s the potential to improve future planning and tackle some of the more difficult decisions, said Courteau.

“What am I going to build, what’s the cost to build, what are the consumer trends, what are the upcoming neighbourhoods, how do I create a mixed environment…this is a data rich environment that can have a significant impact on the value of this new building that you’re about to build.”

The survey noted that technology has enabled numerous disruptive trends including multi-family co-living, a sort of dorm-style arrangement with small private bedroom and shared living and kitchen space, as well as co-working spaces and new models for real estate on the retail side to provide more brand exposure and entertainment options.

While adoption has been slower in Canada, many global markets have also started to take advantage of online marketplaces to cut out intermediaries in lending, investment, leasing, and property exchanges. The survey notes that the explosion of proptech firms likely means a significant consolidation is pending, with most Canadian executives polled expecting consolidation within the next 12 to 24 months.

This report by The Canadian Press was first published Jan. 27, 2020.

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When Is The Real Estate Market The Hottest In Vancouver? – RE/MAX News

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It’s no secret that Vancouver’s housing market is one of the highest in the country – in fact, it’s been consistently ranked as the second-highest Canadian city real estate market (or overvalued, according to the Financial Post), with Toronto dubbed as the country’s first most unaffordable housing market.

Predictions for Vancouver’s Housing Prices in 2020

A report by the British Columbia Real Estate Association (BCREA) predicts that 2020 average MLS Price will be 1 percent higher than that of 2019, translating to an average home price of $995,000. In tandem with this, the number of unit sales predicted for the upcoming year will be 30,100, a shockingly high 18.2 percent increase from the previous year.

Needless to say, Vancouver’s market is always hot. But there are times that are better than others for homebuyers.

When The Vancouver Real Estate is (Truly) Hot

As with many aspects of the economy, there is a seasonality to the housing market in any city, including Vancouver. When looking for a home to buy (or sell) the spring months are typically a common time for housing to become listed on the market. With this change in the seasons, homebuyers will find that, despite the increased number of listings to choose from, the competition amongst homebuyers so too increases.

This increase is generally a result of sellers remaining confident heading into the summer months, which affects the seller’s ability to find success in lowball offers. In some cases during this hot season, homebuyers may find themselves in a bidding war.

With springtime as the high season in terms of housing prices, once can begin to see a slight shift through the summer months. With many home buyers and sellers taking time off, many choose not to list their homes. With both parties generally taking a step back from their real estate deals, there is both less inventory and less of a competitive market amongst sellers.

Then, the fall season hits, bringing the flurry of real estate sales to a much slower pace in preparation for the extremely slow traffic that is seen in the winter. So, for sellers, mark your calendars for the spring where many homebuyers are beginning to think about their next property move. And for prospective homebuyers? Set your sights on buying a home in the much less competitive market during January and early February.

Some experts, however, look at the year 2020 as a whole with strong senses for a balanced market, meaning the homebuyers and sellers will experience a more normalized market for possibly the next two years.

Beyond the Hot Real Estate Market Periods in Vancouver

There are several factors at play that could affect the state of Vancouver’s housing market and potentially turn one of the country’s overall hottest markets into a slightly less competitive market.

Foreign Buyers Tax

One of the commonly reported contributors to the increased housing prices in Vancouver’s market is foreign buyers. As a result, British Columbia introduced a foreign buyers’ tax in 2016 that was designed to make the purchase of property by non-residents or citizens more cost-prohibitive. This tax structure imposed a 15 percent tax on foreign property buyers for housing throughout Metro Vancouver.

While there is some criticism around this tax, British Columbia isn’t the first market to implement this taxation structure. According to a news article by Jeremy Hainsworth for Vancouver Is Awesome, Hong Kong, Australia, Singapore and Israel have all introduced a form of this taxation to maintain a higher affordability rate for residents and citizens in comparison to the affordability for foreign nationals looking to purchase property.

Where Interest Rates Are Going in 2020

Canadian Mortgage Trends predicts that, in 2020, the Bank of Canada is expected to cut their mortgage rates in 2020. This follows suit with 40 banks around the world that had cut their rates in the year 2019 in response to a slower market during that same year. To be specific in their predictions, the article suggests a 30 percent chance of a rate cut by the Bank of Canada by July of this year.

Stress Tests in Vancouver’s Housing Market

In order to be approved for a mortgage for a home in Vancouver, most homebuyers are subject to a stress test. A stress test is part of a mortgage qualifier test that evaluates what mortgage amount a homebuyer is eligible for.

Essentially, a stress test is a homebuyer’s opportunity to prove that they can afford to pay the mortgage payments with the expected interest rate for the foreseeable future. A stress test is conducted by any bank lender but is not typically carried out by private lenders and credit unions.

In order to pass the mortgage stress test and secure the mortgage that you’re looking for, a prospective home buyer will need to qualify at either the contracted mortgage interest rate plus 2 percent or the Bank of Canada’s five-year benchmark rate, whichever option is higher.

Understanding a mortgage stress test is a valuable and necessary aspect of buying a home in Vancouver, hot market or not. Especially during a hot market, though, it’s important to be realistic about your ability to pay off the mortgage you are seeking.

Buying a Vancouver Residential Property in 2020

A PwC report suggests that, in conjunction with Vancouver’s mellowing economy, the market will begin to level out. Further, an increase in supply and the number of policies that are designed to reduce the volatility of the housing market will further strengthen the balance in the housing market, PwC predicts.

More Insights Into Vancouver’s Housing Market

Vancouver is the ideal place to live for many Canadians; the urban amenities, strong job market and diversity offer a lot of benefits for many residents, with the added bonus of having quick access to ample recreation. But with all these perks come the highly competitive and dynamic real estate market in the Great Vancouver area.

Stay on top of the city’s real estate market by visiting the REMAX Canada blog here.

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