A report released this past Monday from the Canada Mortgage and Housing Corporation, or CMHC for short, predicts that Canada’s real estate housing market can look forward to at least a couple more years of stability. Activity for 2012 is expected to be at roughly the same levels as 2011 as far as sales and housing starts, so predicts Mathieu Laberge, who is a CMHC deputy chief economist.
Condo owners in British Columbia will soon be facing the same rule changes already implemented in Alberta and Ontario. These concern disclosure requirements, which are much more stringent. Owners must now file a depreciation report on their properties once every three years. It is not sure how this will affect both short and long term condo investors.
A new MLS tool will be introduced into five of the largest Canadian housing markets; Vancouver, the Fraser Valley, Calgary, Montreal and Toronto. By the end of 2013, some 16 more major metropolises will be on board. This new tool will keep high end sales from influencing the CREA’s monthly sales figures, and stifle critics of the current system.
One of the items regularly listed on an offer is a requirement for a home inspection. These days, there is such a demand for multifamily investment properties, that some developers/agents are offering pre-offer home inspections. This saves time and gives buyers an advantage, particularly in situations where there are multiple bids.
The more you borrow, the more you owe. That is certainly proving to be the case in Canada, where those who have extended themselves the most are finding it harder to catch up. A report by CIBC World Market noted that nearly 73 percent of Canadians fell into a debt-to-gross ratio of more than 1.6 percent. The nation as a whole is seeing an income/debt ratio of 151 percent. In the United States, the ratio was 160 percent before the market in that country took a nosedive.
Vancouver took second place in a recent worldwide survey of least-affordable places to live. Hong Kong was the only city more expensive, and out of the 325 cities surveyed, that is saying something. The median price of a home in Vancouver for the third quarter of 2011 was $678,000 CAD. That is 10.8 times the medium pre-tax household income, which is $63,800 CAD. That figure puts the city in the severely unaffordable category.
There has been talk of a housing bubble in Canada for some time. But one of Canada’s largest realty firms, Royal LePage, does not believe this is in the cards. Rather, their prediction is for almost a three percent increase in prices by the end of 2012.
After being one of the most volatile real estate markets in Canada, British Columbia may finally be in balanced territory. November 2011 Multiple Listing Sales are down just a hint from the same month in 2010. As far as price growth, there was only a one percent gain.
The housing picture in Greater Vancouver is taking a slight shift from what was considered the norm. Multi family homes are being considered more than they have in the past, so much so that in November starts in the multi family real estate category outnumbered those in the single family category.
For the past few years many have doubted the strength of the Vancouver real estate market. This past November saw a slight decline in sales and the tendency of these people are to say I told you so. But for those in the know, including the Greater Vancouver Real Estate Board, or GVREB, this is just a normal market correction. The market is becoming more balanced.
