The long-concealed market value of Tokyo’s largest skyscrapers is being unveiled by activist investors.

In Japan, there’s a huge gap — 22 trillion yen ($143 billion) by one estimate — between how companies value their real estate assets on their books, versus what those same properties would fetch if sold in the current market. That comes from two factors: First, many of the island nation’s firms have held onto properties for decades, each year writing down the cost of fixed assets due to annual depreciation, a common accounting practice. But at the same time, property prices have soared.

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Canada Mortgage and Housing Corp. says the annual pace of housing starts in March declined seven per cent compared with February.

The national housing agency says the seasonally adjusted annual rate of housing starts amounted to 242,195 units in March compared with 260,047 in February.

When looking at year-over-year figures, actual housing starts in large urban centres were up 16 per cent to 17,052 units last month compared with 14,756 units in March 2023. The year-over-year increase was driven by higher multi-unit starts, up 19 per cent, and higher single-detached starts, up two per cent.

Actual housing starts were 10 per cent higher in Toronto and 15 per cent higher in Vancouver year-over-year because of an increase in multi-unit starts. Montreal’s actual starts dipped one per cent, dragged down by lower multi-unit starts.

The annual rate of rural starts was estimated at 21,452 units.

TD economist Rishi Sondhi said housing starts continue to trend “at a solid pace,” even with the month-over-month decline in March, supported by elevated prices and firm pre-construction sales in the past.

But he cautioned that further decreases to the number of starts are likely in the months to come.

“While governments are actively looking for ways to enhance supply, we think that housing starts are likely to decline further this year, on the back of more recent weakness in pre-sales activity,” he said in a note.

“What’s more, industry analysis suggests that financing for purpose-built rental units currently under construction was obtained when borrowing conditions were more favourable. As they’ve turned tougher, this segment of the market could be impacted.”

Month-to-month starts can fluctuate significantly since the launch of larger multi-unit developments can skew numbers. Adjusted starts in March were up 27 per cent in Vancouver, driven by an increase in multi-unit starts, while Toronto and Montreal declined 26 per cent and five per cent, respectively, due to decreases in multi-unit starts.

To smooth out those swings and give a clearer picture of the upcoming housing supply trend, CMHC also reports a six-month moving average of the adjusted rate.

In March, the indicator showed starts at 243,957, down 1.6 per cent from 247,971 in February.

“The slight decline in multi-unit housing starts in March likely just reflects the volatile nature from one month to the next of these large projects,” Desjardins economist Kari Norman said in a note.

“Looking forward, the gradual unwinding of interest rate hikes expected to begin this June will bring cautious optimism to housing starts. However, this optimism is tempered by challenges such as construction labour shortages, inflation in building materials costs and weaker homebuilder sentiment.”

She said those factors could potentially slow the momentum seen in early 2024, despite a favourable shift in monetary policy.This report by The Canadian Press was first published April 16, 2024.

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233 Beecroft Rd., No. 1911, Toronto

Asking price: $599,800 (March 2024)

Selling price: $652,000 (March 2024)

Previous selling price: $240,000 (January 2007); $183,767 (August 2001)

Taxes: $2,219 (2023)

Days on the market: 11

Listing agents: Sam Ahn and Stephen Sun, Re/Max Realtron Realty Inc.

The action

Spring-like weather and a lack of high-rise inventory around Mel Lastman Square aligned to give this one-bedroom plus den unit a boost in March. Six buyers, all intending to live in the condo rather than purchasing it as an investment, made offers. The highest bid came in $52,200 over the asking price, with a closing date of May 15.

“With the weather being on our side – it was relatively warm – sales being slow in the winter, and hopes that [mortgage] rates would go down, we decided to go low on our price to test the market,” said agent Sam Ahn.

“Half the offers were very competitive, so it was hard to choose among the top three offers.”

What they got

On the sub-penthouse level of a 22-year-old building, this 667-square-foot unit has an open living and dining area with a wall of windows and an enclosed den with sliding doors to a balcony.

Improvements were made in the four-piece bathroom and galley-style kitchen. For instance, the latter features quartz countertops, mosaic backsplashes and stainless steel appliances.

The unit comes with laundry machines, plus a storage locker and parking spot. Monthly fees of $609 cover utilities, concierge, and use of a gym and party room.

The agent’s take

“The biggest selling feature was the view. It was a west-facing, unobstructed view on a high floor,” said Mr. Ahn.

“It’s not a trendy building, but a building with a good reputation and it’s well managed. Having a low maintenance fee was also a key feature, and it included all utilities, which is rare to find nowadays in new condos with meters.”

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