Our weekly roundup of real estate news from Toronto, Canada, the U.S., and around the world ending Aug. 4, 2017.
Toronto real estate market picks up after lull (The Globe and Mail)
Home buyers in Toronto and some of the surrounding areas appear to be testing their mettle again after spending a few weeks on the sidelines.
It’s too soon to tell if a flurry of sales signals a trend with staying power or if some buyers simply need to move on with their lives, but the action – especially at the high end – suggests some resilience in an uncertain real estate market.
Home prices in Canada’s largest city posted their biggest monthly drop in at least 17 years in July and sales plunged as government efforts to cool the market and the near-collapse of a mortgage lender made buyers leery.
The benchmark Toronto property price, which tracks a typical home over time, dropped 4.6 percent to C$773,000 ($613,000) from June. That’s the biggest monthly drop since records for the price index began in 2000, according to Bloomberg calculations, and brings prices down to roughly March levels. Prices are still up 18 percent from the same month a year ago, according to the Toronto Real Estate Board.
Housing slowdown? New condo sales are booming in Toronto (The Globe and Mail)
Toronto’s resale housing market has cooled off considerably since Ontario’s move to rein in frenzied activity. Meanwhile, demand is only increasing for new condo units.
Sales of new condos in the census metropolitan area totalled 12,138 in the second quarter, up 62 per cent from a year earlier, according to data provided by BMO Nesbitt Burns. Inventory levels have more than halved over the same span.
B.C. foreign buyers’ tax and other measures under review, minister says (The Toronto Star)
VANCOUVER—The British Columbia government is reviewing the foreign buyers’ tax in the Vancouver area and the interest-free loan program to first-time homebuyers to determine whether they have helped improve affordability, the province’s new housing minister says.
In an interview Monday, Selina Robinson said she and provincial Finance Minister Carole James will go over real estate transaction data in an effort to decide whether such measures should be kept, revised or scrapped altogether.
Canada’s long housing boom has drawn thousands into the sector, from realtors and home stagers to construction workers, and a looming slowdown threatens to trigger an exodus that could wipe out many of those jobs and force the economy to shift down.
While housing has long been the main engine of Canadian growth, economists say a drop in home sales has already started to weigh on the economy and if price declines follow, consumer spending and jobs will suffer. “To a lot of people, it is a get-rich-quick scheme,” Toronto realtor David Fleming said about the real estate market. “But history shows when the market turns, half of the agents leave.”
Census reveals that young adults are living with their parents longer (The Toronto Star)
Ottawa—The rising cost of housing in Canada is having at least one major impact on the makeup of families: fewer kids are leaving home.
The share of Canadians aged 20 to 34 who were living with a parent has increased to 34.7 per cent, according to census data released by Statistics Canada on Wednesday. That’s up from 33.3 per cent in the last census five years earlier and from 30.6 per cent in 2001.
U.S. Homes Prices Up 50 Percent Over 2011 Housing Bottom (World Property Journal)
According to CoreLogic’s latest Home Price Index for June 2017, U.S. home prices are up strongly both year over year and month over month. Home prices nationally increased year over year by 6.7 percent from June 2016 to June 2017, and on a month-over-month basis, home prices increased by 1.1 percent in June 2017 compared with May 2017.
Looking ahead, the CoreLogic HPI Forecast indicates that home prices will increase by 5.2 percent on a year-over-year basis from June 2017 to June 2018, and on a month-over-month basis home prices are expected to increase by 0.6 percent from June 2017 to July 2017.
Home price gains are accelerating again, and in some cities those values are overheating.
Four of the nation’s largest cities are now considered overvalued, according to CoreLogic. Home prices in Denver, Houston, Miami and the Washington, D.C., metropolitan area now exceed sustainable levels.
U.S. Homeowners Spend $7,000 to $16,000 Annually in Hidden Costs (World Property Journal)
According to a new analysis from Zillow and Thumbtack, nationally, U.S. homeowners can expect to spend $9,080 a year on average in hidden costs related to owning and maintaining a home. Since nearly half (47 percent) of home shoppers today are first-time buyers, many of these extra costs may come as a surprise.
To help with budgeting, Zillow and Thumbtack identified several common but often overlooked home expenses and calculated what homeowners could expect to pay for them around the country. The analysis also included utility cost estimates from Utility Score.
If housing is to become more affordable in Hong Kong the number of new homes being built needs to increase, according to officials and real estate experts.
Although the Government has promised to make more land available, supply is expected to be short for some time and therefore prices will keep rising in what is already one of the world’s most expensive property markets.
Korean Teachers’ Credit Union joins TIAA in UK real estate debt fund (Investment and Pension Europe)
TH Real Estate has raised £300m (€335m) for a UK real estate debt fund, securing commitments from the Korean Teachers’ Credit Union (KTCU) and its parent company TIAA.
The announcement comes six months after IPE Real Estate reported that Korean pension fund KTCU and US financial services group TIAA had agreed to invest $1bn (€846m) together in US real estate debt.
The residential property market in France is recovering with record sales higher than expected in the last 12 months and prices rising in some towns and cities.
Overall, the latest property report from the Notaires de France, says that they expect prices to rise by 1.2% year on year by the end of this month but some locations are seeing much higher growth.