Geographically and historically, British Columbia represents perhaps the best opportunity on the planet to make money in commercial real estate. Mortgage rates are at 100-year lows, the housing market is roaring, B.C.’s retail spending leads the country, and the industrial sector is the strongest in Canada by nearly any metric.
The daunting price of B.C. real estate, however, convinces many smaller investors that they are locked out of the market forever.
But, as our series on real estate investing explains, even nascent, non-accredited investors can secure a profitable piece of the real estate action through pooled investments. Consider it the slow and steady route to owning property of your own.
In this third of our four-part Western Investor series, we look at diversifying and profiting in the market through real estate investment trusts (REITs).
A year ago as COVID-19 slammed into Canada’s property market, the benchmark Canadian REIT index (S&P/ TSX Capped REIT Index) immediately plunged 46 per cent from its February 2020 highs, wiping out almost half the index’s value within weeks.
However, as of March 30, 2021, the index had recovered 27 per cent of its value, posting the highest level in the past 12 months. Some analysts forecast that, overall, Canadian REITs will deliver returns of 10 to 12 per cent in 2021.
Others,including Western Investor, expect that returns of 15 per cent to 20 per cent are possible for REITs weighted toward multi-family rental properties, the industrial sector and, perhaps surprisingly, retail assets.
The following are some REIT recommendations.
In the multi-family sector, Canadian Apartment Properties REIT (CAPREIT) is the largest, with about 60,000 apartments across Canada, 9 per cent of them in B.C., notably in Metro Vancouver and Victoria. CAPREIT has a 97.5 per cent rental occupancy and its normalized funds from operations – NFFO, a key metric – increased 14.7 per cent in 2020 to $389 million. On March 30, 2021, it was trading at $54 per unit, up 35 per cent, year-over-year. It is paying an annual dividend of $1.38 per unit. (For instance a $40,000 investment a year ago would have returned approximately $14,000 in unit value, plus $1,380 in dividend payments.)
A multi-family REIT option is InterRent REIT, which, this January in a joint venture with Crestpoint Real Estate Investments, acquired a prime 15 rental-property portfolio in Vancouver for $292.5 million.
Last year set a record for industrial asset sales volume in B.C. with $1.5 billion in transactions, and the market is characterized by a very tight 1.2 per cent vacancy, rising lease rates and ascending sale prices. Most B.C. industrial assets, however, are privately owned and traded.
Choice Properties REIT owns three industrial properties in Metro Vancouver; Artis REIT has a share of two industrial sites; and H&R REIT holds 10 industrial properties in B.C., including four in Metro Vancouver and one in Victoria. H&R REIT has seen its unit value nearly double since March of 2020 and was trading at $14.26 per unit on March 31, 2021.
Dream Industrial REIT holds premier industrial assets in Canada, particularly on the Prairies, and in the U.S. and it has benefited from the rise in ecommerce warehouse and distribution demand. The company is valued at $2.3 billion, units are trading in the $13.40 range and it is paying a 70 cent-per-unit annual dividend.
The retail real estate sector was hammered by the pandemic but there are signs of recovery. B.C., for instance, posted the highest year-over-increase in consumer sales in Canada this year. Choice Properties REIT holds 11 per cent of its 573 retail-property portfolio in B.C. and grocery giant Loblaws is its major tenant. Choice is a diversified REIT with industrial, retail and office properties. It trades in the $14 per unit range and pays an annual dividend of .74 cents per unit.
REITs are considered a fairly secure place to invest in real estate with modest risk, especially in the current low-interest rate environment.
Pick a REIT and a sector you are comfortable with and let its annual growth and dividends help put you onto the path towards owning real estate of your own.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
MONTREAL – The Quebec Professional Association of Real Estate Brokers says Montreal-area home sales rose 9.3 per cent in August compared with the same month last year, with levels slightly higher than the historical average for this time of year.
The association says home sales in the region totalled 2,991 for the month, up from 2,737 in August 2023.
The median price for all housing types was up year-over-year, led by a six per cent increase for the price of a plex at $763,000 last month.
The median price for a single-family home rose 5.2 per cent to $590,000 and the median price for a condominium rose 4.4 per cent to $407,100.
QPAREB market analysis director Charles Brant says the strength of the Montreal resale market contrasts with declines in many other Canadian cities struggling with higher levels of household debt, lower savings and diminishing purchasing power.
Active listings for August jumped 18 per cent compared with a year earlier to 17,200, while new listings rose 1.7 per cent to 4,840.
This report by The Canadian Press was first published Sept. 6, 2024.
In the quest to find cities where renters can enjoy the best of all worlds, a recent study analyzed 24 metrics across three key categories—Housing & Economy, Quality of Life, and Community. The study ranked the 100 largest cities in Canada to determine which ones offer the most to their renters.
Here are the top 10 cities that emerged as the best for renters in 2024:
St. John’s, NL
St. John’s, Newfoundland and Labrador, stand out as the top city for renters in Canada for 2024. Known for its vibrant cultural scene, stunning natural beauty, and welcoming community, St. John’s offers an exceptional quality of life. The city boasts affordable housing, a robust economy, and low unemployment rates, making it an attractive option for those seeking a balanced and enriching living experience. Its rich history, picturesque harbour, and dynamic arts scene further enhance its appeal, ensuring that renters can enjoy both comfort and excitement in this charming coastal city.
Sherbrooke, QC
Sherbrooke, Quebec, emerges as a leading city for renters in Canada for 2024, offering a blend of affordability and quality of life. Nestled in the heart of the Eastern Townships, Sherbrooke is known for its picturesque landscapes, vibrant cultural scene, and strong community spirit. The city provides affordable rental options, low living costs, and a thriving local economy, making it an ideal destination for those seeking both comfort and economic stability. With its rich history, numerous parks, and dynamic arts and education sectors, Sherbrooke presents an inviting environment for renters looking for a well-rounded lifestyle.
Québec City, QC
Québec City, the capital of Quebec, stands out as a premier destination for renters in Canada for 2024. Known for its rich history, stunning architecture, and vibrant cultural heritage, this city offers an exceptional quality of life. Renters benefit from affordable housing, excellent public services, and a robust economy. The city’s charming streets, historic sites, and diverse culinary scene provide a unique living experience. With top-notch education institutions, numerous parks, and a strong sense of community, Québec City is an ideal choice for those seeking a dynamic and fulfilling lifestyle.
Trois-Rivières, QC
Trois-Rivières, nestled between Montreal and Quebec City, emerges as a top choice for renters in Canada. This historic city, known for its picturesque riverside views and rich cultural scene, offers an appealing blend of affordability and quality of life. Renters in Trois-Rivières enjoy reasonable housing costs, a low unemployment rate, and a vibrant community atmosphere. The city’s well-preserved historic sites, bustling arts community, and excellent educational institutions make it an attractive destination for those seeking a balanced and enriching lifestyle.
Saguenay, QC
Saguenay, located in the stunning Saguenay–Lac-Saint-Jean region of Quebec, is a prime destination for renters seeking affordable living amidst breathtaking natural beauty. Known for its picturesque fjords and vibrant cultural scene, Saguenay offers residents a high quality of life with lower housing costs compared to major urban centers. The city boasts a strong sense of community, excellent recreational opportunities, and a growing economy. For those looking to combine affordability with a rich cultural and natural environment, Saguenay stands out as an ideal choice.
Granby, QC
Granby, nestled in the heart of Quebec’s Eastern Townships, offers renters a delightful blend of small-town charm and ample opportunities. Known for its beautiful parks, vibrant cultural scene, and family-friendly environment, Granby provides an exceptional quality of life. The city’s affordable housing market and strong sense of community make it an attractive option for those seeking a peaceful yet dynamic place to live. With its renowned zoo, bustling downtown, and numerous outdoor activities, Granby is a hidden gem that caters to a diverse range of lifestyles.
Fredericton, NB
Fredericton, the capital city of New Brunswick, offers renters a harmonious blend of historical charm and modern amenities. Known for its vibrant arts scene, beautiful riverfront, and welcoming community, Fredericton provides an excellent quality of life. The city boasts affordable housing options, scenic parks, and a strong educational presence with institutions like the University of New Brunswick. Its rich cultural heritage, coupled with a thriving local economy, makes Fredericton an attractive destination for those seeking a balanced and fulfilling lifestyle.
Saint John, NB
Saint John, New Brunswick’s largest city, is a coastal gem known for its stunning waterfront and rich heritage. Nestled on the Bay of Fundy, it offers renters an affordable cost of living with a unique blend of historic architecture and modern conveniences. The city’s vibrant uptown area is bustling with shops, restaurants, and cultural attractions, while its scenic parks and outdoor spaces provide ample opportunities for recreation. Saint John’s strong sense of community and economic growth make it an inviting place for those looking to enjoy both urban and natural beauty.
Saint-Hyacinthe, QC
Saint-Hyacinthe, located in the Montérégie region of Quebec, is a vibrant city known for its strong agricultural roots and innovative spirit. Often referred to as the “Agricultural Technopolis,” it is home to numerous research centers and educational institutions. Renters in Saint-Hyacinthe benefit from a high quality of life with access to excellent local amenities, including parks, cultural events, and a thriving local food scene. The city’s affordable housing and close-knit community atmosphere make it an attractive option for those seeking a balanced and enriching lifestyle.
Lévis, QC
Lévis, located on the southern shore of the St. Lawrence River across from Quebec City, offers a unique blend of historical charm and modern conveniences. Known for its picturesque views and well-preserved heritage sites, Lévis is a city where history meets contemporary living. Residents enjoy a high quality of life with excellent public services, green spaces, and cultural activities. The city’s affordable housing options and strong sense of community make it a desirable place for renters looking for both tranquility and easy access to urban amenities.
This category looked at factors such as average rent, housing costs, rental availability, and unemployment rates. Québec stood out with 10 cities ranking at the top, demonstrating strong economic stability and affordable housing options, which are critical for renters looking for cost-effective living conditions.
Québec again led the pack in this category, with five cities in the top 10. Ontario followed closely with three cities. British Columbia excelled in walkability, with four cities achieving the highest walk scores, while Caledon topped the list for its extensive green spaces. These factors contribute significantly to the overall quality of life, making these cities attractive for renters.
Victoria, BC, emerged as the leader in this category due to its rich array of restaurants, museums, and educational institutions, offering a vibrant community life. St. John’s, NL, and Vancouver, BC, also ranked highly. Québec City, QC, and Lévis, QC, scored the highest in life satisfaction, reflecting a strong sense of community and well-being. Additionally, Saskatoon, SK, and Oshawa, ON, were noted for having residents with lower stress levels.
For a comprehensive view of the rankings and detailed interactive visuals, you can visit the full study by Point2Homes.
While no city can provide a perfect living experience for every renter, the cities highlighted in this study come remarkably close by excelling in key areas such as housing affordability, quality of life, and community engagement. These findings offer valuable insights for renters seeking the best places to live in Canada in 2024.
