Our weekly round-up of real estate news in Toronto, across Canada and the world for the week ending May 26, 2017.
Limit overlap on city real estate portfolio: Tory (Toronto Sun)
City council could start untangling this week how it manages its $27-billion real estate portfolio.
Mayor John Tory says the move is essential to save taxpayers money by limiting overlap between the 24 agencies that currently have their fingers in the city’s real estate pie. It would also help cut down on squabbles between departments that sometimes have competing interests for city-owned properties.
The May long weekend is the traditional kickoff to cottage season. But long before the snow melted this spring, equity-rich baby boomers from the city had been turning up the heat on resort-area real estate.
Agents in Muskoka and Haliburton say most of the action is down to a new breed of older buyer: 50-somethings, cashing out and driving north to retire or telecommute. Many maintain a condo in the GTA or they go south in the winter.
Call it the tale of Toronto’s two housing markets: on one side are the million-dollar-plus single-detached homes, and on the other, those tiny boxes in the sky.
What’s missing, is everything in the middle.
Canada’s exuberance with real estate is beginning to wane.
Weekly polling data show real estate price expectations have come down from record levels, in a sign that Canadians are anticipating housing markets in places like Toronto will finally cool. The share of people saying home prices will rise in the next six months fell for a second week to 46 percent, according to data compiled by Nanos Research Group for Bloomberg News. That’s down from 47.7 percent the previous week and below a record 50.1 percent two weeks ago.
Nearly three quarters of Canadian homeowners say they would have difficulty paying their mortgage if their payments were to increase by more than 10 per cent, says a new survey by Manulife Bank.
Thirty-eight per cent of those polled say their mortgage bills could rise between one to five per cent before they would have financial difficulty; 20 per cent say they could sustain an increase in payments between six to 10 per cent before having trouble; and 14 per cent say any hike would be a problem.
Metro bitcoin house sale offer ‘an honest mistake’ (Business in Vancouver)
A Metro Vancouver house advertised for sale in bitcoins was an “honest mistake that never should have been made,” said Derek Drew, manager-broker of Sutton Centre Realty in Burnaby.
The newly built, 5,000-square-foot house at 707 Firdale Street in Coquitlam had been advertised on Craigslist in Vancouver and Hong Kong. The ad reads “$2099 Bitcoin new house for sale btc (Coquitlam).” The asking price of 2,099 bitcoins equates to just over $5 million. The listing drew media attention, with the Huffington Post headlining it “suspicious activity” and drawing attention to China’s crackdown on currency outflows. The country’s residents are not allowed to take more than $50,000 out of the country for investments. They are also required to sign a letter stating they will not use their money to buy residential real estate abroad. It has been suggested that bitcoins offer a route for some to move money out of the country. Bitcoin, first introduced in 2008, is a peer-to-peer digital currency that functions without any central authority and can be transferred anonymously.
Transit Hubs: A Growing Lure for Developers (The New York Times)
Rail stations, it turns out, are delivering much more than passengers to surrounding neighborhoods.
Young workers who prefer to walk or take the train — rather than drive — to eat, work and shop are pushing up property values and reshaping the way developers approach their plans.
Persistent low supply continues to affect the US housing market (Property Wire)
Stubbornly low housing supply levels held down existing home sales in April in the United States and also pushed the median number of days a home was on the market to a new low, the latest index shows.
Total existing home sales fell by 2.3% month on month but are still 1.6% above a year ago and at the fourth highest pace over the last year, according to the report from the National Association of Realtors.
Foreign Buyers, Immigrants to Drive Bigger Share of Future U.S. Home Sales (World Property Journal)
According to speakers at the National Associations of Realtors recent international real estate forum in Washington D.C., housing markets across the U.S. are increasingly becoming international, and changing demographics brought forth by immigration and growing interest from foreigners are positioned to bolster home sales activity and prices.
NAR’s Danielle Hale, managing director of housing research, was joined by Alex Nowrasteh, immigration policy analyst at the Center for Global Liberty and Prosperity at the Cato Institute, to share insight on the current and future impact of foreign buyers and immigration on the U.S. housing market.
Demand grows for industrial real estate in Kenya (Oxford Business Group)
According to a study released by property consultancy Knight Frank in April, Kenya’s industrial property market has gathered strength in the past two years, with rents for prime industrial space up by 11.9% since the beginning of 2015.
“Industrial rents have risen, as a result of a move by developers into the high-end logistics market,” said Ben Woodhams, managing director for Knight Frank Kenya, at the report’s launch.
In the past, they helped drive the inner-city apartment market to new heights. Around 5,000 new apartments are expected to be completed and up for sale this year.
However, around 80 per cent of Chinese buyers will not be able to settle because of trouble getting finance, according to Ming Li, a real estate agent in Melbourne’s eastern suburbs who specialises in selling Australian property to Chinese investors.
Apartment construction is booming as the wealthy rush to invest in rental housing as a way to reduce inheritance tax and banks hand out easy mortgages, but concerns are mounting that excessive supply paired with a shrinking population could soon lead to the bursting of the bubble.
New starts on apartments and other rental housing in 2016 rose 10.5 percent from a year earlier to over 418,500 units, government data show. The figure took a dive after the 2008 global financial crisis but has risen for the past five years.