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Toronto and Vancouver Real Estate Inventory May Get A Boost From AirBNB Slowdown – Better Dwelling

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Canadian real estate markets may be getting another inventory headwind soon. National Bank of Canada (NBC) research estimates AirBNB hosts may contribute to oversupply later this year. As the slowdown impacts hosts, many may be incentivized to sell. By their estimates, just a quarter of hosts selling would cause inventory in cities like Toronto and Vancouver to swell.

AirBNB and Housing Inventory

AirBNB helps homeowners take existing housing stock and convert it to short-term rentals. Rather than staying in hotels, travelers can now stay in existing non-hotel stock. At first, it wasn’t a big issue when just a few people were doing it. As the platform expanded, people began buying additional housing just to operate short-term rentals. By repurposing housing that would otherwise be long-term units, cities now need additional housing. Basically, short-term rentals lead to an inventory squeeze, pushing rents and prices higher. Temporarily at least, for as long as the squeeze persists. That squeeze could end as quickly as travel did.

The Travel Industry Expects A Big Slowdown

The travel industry doesn’t expect travel to recover quickly from the pandemic. The US has approved some routes cutting plane traffic up to 90% until September. The IATA, the trade association for international airlines, also doesn’t see traffic returning to 2019 levels until at least 2023 – at the earliest. What does this mean? Fewer users of short-term rentals, and more competition from hotels for those travelers. All of this can have a big impact on real estate inventory, according to NBC numbers.

Canada’s Biggest Real Estate Markets May See Inventory Spike

If just a quarter of AirBNB inventory is sold off, NBC sees a lot more real estate listings on the market. In Vancouver, the bank estimates real estate listings would rise 12%. Montreal would see an increase of 27% in resale listings. Toronto is another story though, with inventory forecasted to rise a whopping 34%. That’s with just 25% of AirBNB exiting as hosts.

AirBNB Boost To Canadian Real Estate Inventory

The potential increase in real estate listings if 25% of AirBNB properties were listed for sale.

Source: National Bank of Canada, Better Dwelling.

The boost is another headwind for inventory rising later in the year. Inventory was already expected to rise in the coming few months. NBC economists believe this would be “exacerbating oversupply in the coming months.”

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B.C. Real Estate Association releases new rules for open houses – Globalnews.ca

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It’s been a long tradition in the real estate industry: Showcasing a home for sale via an open house, where anyone could just walk in.

“In the pre-COVID days, open houses were often a form of Sunday afternoon entertainment,” said Darlene Hyde, CEO of the B.C. Real Estate Association (BCRCA).

“People would just go into a house to see what it looked like.”

Those days are now gone, at least for the foreseeable future, as modifications are underway keep everyone safe during the pandemic.

Read more:
Real estate sales, house prices rising in Central Okanagan

On Wednesday, the BCRCA released new rules for realtors holding open houses, which are now resuming after being on hold for the past four months.

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“This will be safe for the public going through the open house, it will be safe for the occupants, it will be safe for the public and for the realtors,” Hyde told Global News.

The new protocols include limiting open-house attendees to serious buyers by leveraging technology tools and screening for qualifying consumers.

The new guidelines also encourage realtors to pre-register potential buyers before they attend the open house.

“The realtor community is going to a lot of extra lengths to make it safe, so there’s no point in having people on a property or in a place that don’t have to be there,” Hyde said.

Read more:
Coronavirus: Okanagan real estate market adapts to new conditions

Other guidelines include buyers having to wait outside for their turn if numerous people are wanting to go through a home and all parties involved wearing masks and maintaining their social distance inside.

Kelowna realtor Geoff Hayes welcomes the new rules.

“It’s kind of helping us keep the handle on the pandemic, but it’s also helping us do our job,” he told Global News.

Hays said for the past four months, realtors have had to rely on technology to market homes for sale.

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“We’re using our phones, we’re going live on social media, Instagram, Facebook,” he said.






2:35
Toronto home prices rising, bidding wars declining


Toronto home prices rising, bidding wars declining

Many realtors have been holding virtual open houses, since traditional ones have not been taking place since mid-March.

“People, they typically want all eyes on their home, so it’s just been one of those things where . . . we had to explain, ‘Well the bad news is we can’t do them, but the good news is we can do them a different way,’” Hayes said.

Hyde said the pandemic has made it tough the last few months to market homes for sale.

“It has been extremely challenging and we have encouraged realtors to use virtual means whenever possible,” she said.






2:34
The New Reality: How COVID-19 could impact the commercial real estate market


The New Reality: How COVID-19 could impact the commercial real estate market

Despite the new strict guidelines in the industry, Hyde said things are looking promising.

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“The market is opening up, and in the Okanagan for example, sales rebounded in June. They are back to pre-COVID levels, so things are really looking good for the Okanagan.”

Hyde added that the supply of homes, however, remains low.

“It’s got to be putting a little bit of pressure on the price,” she said. “There’s a lot of uncertainty ahead but we are cautiously optimistic that the market will remain firm.”

© 2020 Global News, a division of Corus Entertainment Inc.

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Victoria Real Estate Market Sees 9.2% Increase In June

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Sandi-Jo Ayers is President of the Victoria Real Estate Board 

VICTORIA – A total of 808 properties sold in the Victoria Real Estate Board region this June, 9.2 per cent more than the 740 properties sold in June 2019 and 76.8 per cent more than the previous month of May 2020. Sales of condominiums were down 3.2 per cent from June 2019 with 209 units sold. Sales of single-family homes were up 16.8 per cent from June 2019 with 460 sold.

“This June we saw competing factors from all different sides of the real estate equation,” says Victoria Real Estate Board President Sandi-Jo Ayers. “If all we do is look at numbers, we see a fairly normal June, in the midst of a very not normal world. The impact of COVID-19 on our entire economy continues. And while some buyers and sellers are slow to emerge from isolation, others have been highly active since the start of Phase 2 of BC’s Restart Plan. Because of the pandemics, an eviction order that prohibited a landlord from ending a tenancy was introduced. The order may have kept some homes from going to market. The portion of this order that prevented a seller from providing vacant possession of a tenanted home was lifted late this month, which may bring some listings to market that had been stalled. Due to the pandemic alone, we have multiple factors influencing the inventory and sales in our market.”

There were 2,698 active listings for sale on the Victoria Real Estate Board Multiple Listing Service at the end of June 2020, 11.3 percent fewer properties than the total available at the end of June 2019 but a 6.1 per cent increase from the 2,544 active listings for sale at the end of May 2020.

“Additionally, the Canada Mortgage and Housing Corporation announced changes that start July 1 which will reduce the borrowing power of some buyers who insure through CMHC,” adds Ayers. “This may have pushed some demand forward – although there are alternate suppliers of mortgage insurance. Ongoing low inventory levels also mean that we are seeing a fair number of multiple offers. The condo market is slightly softer in terms of sales numbers. This may be in part due to the recent strata insurance issues which caused concern for owners and sellers. The government promised this month to begin to address the insurance issue, so there may be some relief on the horizon. These are not normal days for local real estate, nor is this month a signal of a return to normal, regardless of the numbers. That said, buyers and sellers are successfully navigating our market with the help of local realtors, who know how to implement health and safety protocols and understand the complexities of our current market. As always, I recommend you consult your Realtor to understand what is happening in the moment.”

The Multiple Listing Service Home Price Index benchmark value for a single-family home in the Victoria Core in June 2019 was $861,800. The benchmark value for the same home in June 2020 increased by 4 per cent to $896,200, 1.2 per cent more than May’s value of $885,400. The MLS HPI benchmark value for a condominium in the Victoria Core area in June 2019 was $519,100, while the benchmark value for the same condominium in June 2020 increased by 1.3 per cent to $525,600, 1.6 per cent less than the May value of $534,300.

Source: – Business Examiner

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Fraser Valley Real Estate Board says sales double in June, buyers returning to market – Abbotsford News

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Real-estate sales in the Fraser Valley are back on the upward trajectory after COVID-19 slowed the growth of the market for several months.

The Fraser Valley Real Estate Board (FVREB) said they saw 1,718 sales through their multiple-listing service in June, an increase of 113.4 per cent over May’s sales, and an increase of 31.5 per cent over June of last year.

“We’re cautiously optimistic. June’s numbers clearly indicate that the market is functioning in this challenging new environment and we’re returning to more typical activity levels,” said Chris Shields, president of the board. “[Buyers] are getting more comfortable with the new buying and selling process.”

He said that very-low interest rates, high demand over the previous three months when “the market was on hold,” and new Canadian Mortgage and Housing Corporation rules (which came into effect July 1) are all contributing factors.

The board says they had 3,456 new property listings in June, a 56.6 per cent increase compared to May’s 2,207 listings, and a 23 per cent increase over June, 2019.

There were 7,063 active listings by the end of June, an increase of 9.4 per cent from May, but a decrease of 17.1 per cent last year, according to the board.

“We can’t predict how our market will continue to respond during COVID, but what we do know is that historically, over 80 per cent of Fraser Valley buyers move within our region and half purchase within their own community,” Shields said. “People buy and sell for lifestyle reasons and currently, even during this uncertain time, conditions are favourable. The market is balanced, inventory is growing, and prices remain stable.”

The month saw an average sell time of 37 days for the region’s apartments, 30 days for townhouses and 31 days for single-family detached homes, according to the board.

The region’s benchmark price for a single-family detached home was $994,500 (an increase of 3.6 per cent from 2019), $559,600 for townhouses (up 1.9 per cent from 2019) and $435,300 for an apartment (up 3.3 per cent from 2019).

RELATED: Dipping Abbotsford house prices suggest being a couch potato is no longer more profitable than working

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