Montreal might have one of Canada’s hottest real estate markets,
but that doesn’t mean its high-rise condo investors are reaping the
According to a Canada Mortgage and Housing Corporation report,
upwards of 75% of investors in the new high-rises that have
recently sprouted around downtown Montreal are in the red—the
reasons being their mortgage payments, condo fees and annual
Subscribe to CREW for the best in real
estate news and insight – whatever the season.
Use code HOLIDAYS2018 to claim your free festive gift.
“We had a sample of 375 condo units being rented out of the new
high-rises in Montreal, and we see cash flow is mostly negative in
those condos,” Francis Cortellino, a CMHC economist, told CREW.
The number could be lower, though.Cortellino advises that the
study presumed those buyers only put 20% down to purchase their
units, but the reality is a number either put more money down or
even purchased in cash.
The report brings to mind a joint report from CIBC and
Urbanation earlier this year that revealed 44% of Toronto’s condo
investors were in negative cash flow—of which 45% were short by
less than $500, and 20% between $500 and $1,000.In that case,
investors were very likely banking on
Would-be investors who remain wary of the Canadian real estate
market’s price growth should take a measure of comfort in the
results of a new study conducted by Chartered Professional
Accountants of Canada (CPA Canada).
The research found that the market’s fundamentals have
robustness as their main feature, precluding any U.S.-style
meltdown in the near future.
gift of real estate success this year – grab a seasonal
Use code HOLIDAYS2018 to claim your free festive gift.
“Beyond prices and debt levels, Canada shares far fewer
similarities with the U.S.than you might think.This becomes very
apparent when you look at just one measure:credit quality,” CPA
Canada chief economist Francis Fong stated.
Fong emphasized that seeing the U.S.crisis as a reference point
for the possibility of a Canadian collapse would be futile due to
the pre-eminence of different factors in the two markets.
retail will be a great investment destination in 2019
The sheer volume of subprime mortgages issued to borrowers with
low credit quality, who cannot afford to repay debt, is frequently
cited as one of the leading causes of the U.S.breakdown.
In comparison, Canada’s share of high-credit-quality clients
increased from 66% in 2002 to 88% in 2017,
Your tenants are the golden geese that provide you with a monthly golden egg, and your investment property is the nest they live in. Whether you manage your own property, are part of a rental pool with professional management or are an individual with property management in place, it’s important to keep your tenants happy and convert them into long-term tenants – what I like to call residents. Using the term ‘resident’ signifies a difference in the way that both the tenant and the landlord view the property. Generally, residents consider their dwelling to be more like their own home, and with that comes pride in your property. When I was a tenant (before I was a landlord), I found that when I was considered a resident, I was treated with more respect and, in turn, wanted to stay longer and treated the property with more respect – even though I was just renting. So, as a landlord, it’s in your best interest to elevate how you view and treat long-term tenants. Having quality long-term residents can minimize wear and tear on your property, as well as reduce turnover and the need to advertise, interview and vet new tenants (thereby saving you time and money). To achieve this type of relationship, and reduce many of the issues and hassles associated with real estate investment, follow my top 15 tips to keeping your tenants happy. 1. ...
Canadian real estate investors are often dissuaded from
purchasing American properties because of the exchange rate, but a
lot of needless headaches can be avoided by receiving U.S.financing
from select Canadian banks.
“A $400,000 home in the U.S.will become $532,000CAD, so the
U.S.mortgage makes sense to mitigate the impact of the weak
Canadian dollar,” said Alain Forget, RBC’s director of business
development in the U.S.“At $0.76, a lot of Canadians are backing
out of purchases because they’ll still have to change their money
at about 33% exchange.A lot of Canadians don’t know they can get
U.S.financing from a Canadian bank like RBC, and for investment
properties they rent out all year long we can finance 75% of
that.But for a second home, if they use the property for six to
eight weeks and want to rent seasonally for a few months, we can go
with 20% down.”
Canadians are investing increasingly south of the border,
spending $10.5 billion last year.
“It averaged $384,000, and that number can buy you a lot of real
estate in the U.S.’s Sun Belt states,” continued Forget.“There’s a
lot of opportunity in those markets to get three- or four-bedroom
homes, or even nice townhomes with three bedrooms and 3,000 square
feet in gated communities that have resort lifestyles.”
A high-end property in Vancouver’s premier West End district
will be put up for sale to the highest international bidder as part
of Concierge Auctions’ December sale.
The single-family, multi-level 6137 Collingwood Place, which
boasts of a design by legendary Vancouver architect Kenneth
McKinley, will be offered at Concierge’s online marketplace to
Chinese property investors starting December 14.Bidding is expected
to close at a live auction in Hong Kong on December 20 (December 19
The 2,900-square-foot property was previously offered for $3.67
million – and taking updated zoning into account, the parcel offers
substantial opportunities for expansion into a multi-family
building, “either up to approximately 8,147 square feet,” Concierge
luxury property markets maintain strong performances
“Between its multi-family development potential, land assembly
condo potential, location and superior design, the property itself
appeals to a wide range of buyers,” according to listing agent Mark
Wiens of Dracco Pacific Realty.
“I believe a set auction date will induce the buyers who have
already expressed interest to take action.I can personally attest
to the extra exposure the property is receiving since starting the
Concierge Auctions process.This has already led to enquiries coming
from areas where a standard Multiple Listing Service listing would
not have reached.”
A 36-storey office tower touted by its developers as the tallest
commercial building in Vancouver to date will feature the latest
innovations to meet the “net zero carbon” emissions standard – a
major step in Canada’s long-term program to combat the worst
effects of global climate change.
The 161.5-metre Stack tower by Oxford Properties Group will be
among Canada’s very first buildings to pilot the new standard, a
move that is anticipated to magnetize a greater volume of
high-quality investment, according to head of real estate
management Andrew McAllan.
“There’s a convergence of interests in sustainable building.Some
are altruistic and some are just good, old-fashioned capitalism,”
McAllan told The Globe and Mail.
Scheduled for completion by 2022, the complex will offer 540,000
square feet of office space.That volume of commercial space
operating to the specifications of the most advanced green
standards will cement Canada’s place as a worldwide leader in
sustainable development, Oxford said.
Read more:Vancouver office sector to see good inventory,
The building is the latest in Canada’s drive towards
illustrating that environmental consciousness and high-class
commercial spaces are a package deal.The Canada Green Building
Council estimated that since 2004, it has certified over 3,600 LEED
buildings nationwide and registered over 7,600.
“Overall, Canada ranks very
A confluence of government policy, affordability and extremely
robust market fundamentals is impeding movement in Toronto’s rental
The Canada Mortgage and Housing Corporation’s Rental Market
Report for Ontario revealed that Toronto’s vacancy rate hasn’t
changed much from the 16-year low recorded in 2017 (increasing from
1% to 1.1% in 2018), and that the year-over-year turnover rate
recorded in October dropped.
“The rental market is still pretty tight,” said Jordan Nanowski,
a CMHC senior market analyst.“We saw average rent increase 4.9% and
people are staying put as a result.The turnover rate has decreased
substantially from 14.5% to 11.2% because the average rent for
vacant units are 18% higher than occupied units.”
The prohibitive cost of homeownership in the GTA has forced a
growing number of residents into rental accommodations, of which
the dearth is dire, and coupled with population inflow there simply
aren’t enough rental units available.
“It’s a function of very strong demand that is exceeding
supply,” said Nanowski.“A lot of factors go into it, like housing
prices, which are more expensive in the GTA, so people are turning
to renting instead of owning.It’s also that there are higher
borrowing costs with interest rates rising, and there’s less
mortgage availability because of OSFI’s [Office of the
Superintendent of Financial Institutions] new stress testing.”
A throng of retirees, investors, and buyers from Canada’s major
metropolitan areas should be credited for robust recreational
property performance, according to a new report by Royal
“Across our vast land are recreational regions that offer
adventure, opportunities for creating priceless family memories and
a simple refuge from the hustle and bustle of city life,” Royal
LePage president and CEO Phil Soper said.
The phenomenon was especially visible in Ontario, which saw
Toronto and Golden Horseshoe residents gather in droves at the
province’s cottage markets in search of the perfect seasonal
Collingwood’s median detached home prices increased by 6.3%
year-over-year (to reach $549,900), and condos by 5.4% (up to
“Torontonians, and those living west of the city in Cambridge,
Guelph and Kitchener-Waterloo, make up the largest buyer segment in
Collingwood, and the region is seeing increased sales activity from
these purchasers,” Royal LePage Locations North broker and manager
Rick Crouch stated.“Recreational property buyers are choosing
Collingwood for its year-round amenities, such as access to private
ski resorts in Blue Mountain, bicycling clubs and hiking
Read more:Retirees’ influence heating up recreational
Another leading recreational province was Quebec, which
magnetized buyers and investors through its strong economic
performance, consumer confidence, and geographic features.
“Proximity to the slopes
While Montreal’s average home sales price considerably increased
by 6.29% year-over-year in October, historical trends will quash
any fears that the market is headed towards a state of potential
meltdown, the Canadian Real Estate Association assured.
The last peak that Montreal reached prior to last month was June
2010’s annual price growth of 8.89%.This is a positively bygone era
compared to Toronto and Vancouver’s peaks, which were on April 2017
(31.43% increase) and July 2016 (32.61% growth), respectively.
In addition, Montreal’s prices grew by 41.19% over the past 10
years, a rate less than half that of Vancouver (96.98%) or Toronto
housing market continues hot streak to 2020
“Montreal real estate price growth is attracting attention since
it leads the country,” Better Dwelling noted in its analysis of the
CREA numbers.“Except Montreal has lagged Toronto and Vancouver
significantly over the past few years.”
Indeed, Montreal’s average home price was at $350,000 as of
October.Toronto ($766,300) and Vancouver ($1,062,100) continued to
host Canada’s most expensive housing markets.
to grow increasingly unfriendly to first-time buyers
Montreal’s largest mixed-use complex to arise
Are you looking to invest in property?If you like, we can get
General Motors’ announcement that it’s slashing as many as 2,500
jobs in Oshawa will likely have a temporal chilling effect on the
local market, and that presents an opportunity for seasoned
“I know of two deals that were conditional where people pulled
out as a result of this, and I believe that for the next three to
six months there’s going to be a lot of investors sitting on
sidelines waiting to see what’s going to happen in marketplace,”
said Michael Dominguez, a sales representative with REMAX Jazz in
Oshawa, and owner of company name is Doors to Wealth Group.
“My advice is to take advantage of this opportunity because many
novice investors will sit and watch what happens.”
News of the job cuts broke Sunday evening, and as of Monday,
Dominguez had already fielded a number of phone calls from worried
investor clients, whom he reassured.
“The sly is not falling, doom is not setting in,” he said.“Stay
calm is the message I’m delivering.”
During its peak, GM employed over 20,000 people in the Oshawa
area and today there aren’t even 3,000.Moreover, Oshawa has changed
drastically since the plant’s heyday.
“There have been changes over the last 10 to 15 years where
plants have shut down
Statistics Canada reported that the national retail sector beat
earlier predictions of flat growth with a 0.2% increase in activity
last September, despite some evidence of sluggishness in the third
Food and beverage retailers stood at the vanguard with a 0.9%
increase, along with car and clothing outlets.
During the same month, retail sales also increased in 6 of 11
subsectors tracked by StatsCan.These accounted for 75% of
September’s retail trade, the agency told Bloomberg.
These numbers dovetailed with a new Morguard Corporation report,
which found that the powerhouse retail segment will have a vigorous
2019, defying risks such as mixed leasing performance.
investment in this sector will continue in 2019
“While retail sales growth continues to moderate, properties
with development or repositioning potential are expected to
generate strong interest among the investment community looking
ahead to 2019,” Morguard explained.
“Sustained economic expansion over the next few years bodes well
for the Canadian commercial real estate sector as a service
provider to the economy.Canadian commercial property sales activity
will remain robust over the near term, against a backdrop of
positive overall sector performance.”
Together, all of the gains along with the good prospects helped
offset the 1.1% decline in gas station sales in September,
Data from Urbanation indicated that Toronto condo rent rates
increased by 7.6% on an annual basis to reach an average of $2,385
in Q3 2018, and by 17% for newly available purpose-built units.
Long considered a haven for the city’s affordability seekers,
the rental market is becoming less friendly to all but the
“We’ve reached a point now where given the amount of people,
industries we’re attracting, we are already becoming terribly
unaffordable for everyone,” University of Toronto professor Richard
Florida told Bloomberg.“We’re at a crisis and we don’t even realize
it:Our transit, traffic problem and housing problem are urgent
“Everyone’s getting priced out,” he added.“My students at the
Rotman School of Management in the University of Toronto, who are
going to be some of the most successful students in Canadian
business, are now saying it’s doubtful they could ever afford a
deserve adequate protection from housing risk
A scarce supply of rental units is not helping matters, with
Toronto’s apartment vacancy rate currently around 0.5%.
“Homelessness is growing, couch-surfing is growing and this will
have a lot of pressure on families and on the city itself,”
according to Alejandra Ruiz Vargas of the low-and-moderate-income
advocacy group Association of Community Organizations for
All too often, amenity spaces are banal.However, a New
York-based company is looking to change that using the Greater
Toronto and Hamilton Area as its Canadian springboard.
hOM is a real estate technology vendor that teams up with
landlords in both the residential and commercial sectors to develop
holistic amenities that emphasize emotional and physical
health.Established four years ago in New York, where it grew to 35
employees and manages 90 properties with 45 landlords, hOM believes
Toronto is amenable to its concepts.
“We work with property managers to provide a tenant experience
that comes in the form of group fitness and wellness classes and
then our community lifestyle events,” said Lilli Markle, director
of business development at hOM.“We consider ourselves managers in
that we have tech platforms that support the communication of our
programming and data collection that positions the value to the
landlord as an actual ROI.We’re able to translate the data from our
tech platform and survey and interface directly with the users,
then present the data to the landlords.It allows landlords to
retain tenants, which over time saves operation costs and leasing
hOM has only officially partnered with Cadillac Fairview in
Toronto, although it’s in discussions with other companies.In
Toronto’s TD Centre, hOM is going to transform an underused section
With ever-growing prices pushing more and more Canadians out of
the single-family home segment, renting has become an increasingly
popular choice in the hottest markets, a development that the
government should begin responding to in earnest.
Vancouver-based advocacy group Generation Squeeze is calling for
regulatory changes that would grant tenants as much long-term
security as home owners.
Among the most important issues is supply, thus the need to
develop more purpose-built, affordable rental housing.
In its analysis of September data from Statistics Canada, real
estate information portal Point2 Homes reported that the home
ownership ratio nationwide fell for the first time in nearly 50
years, shrinking by 1.2% between 2011 and 2016 to reach 67.8%.
demand to boost further apartment construction – CMHC
A boosted rental inventory would give more Canadians the
opportunity to enjoy the unique benefits of renting, according to
Housing Matters founder Chris Spoke.
“When you think about things like labour mobility, being
flexible enough to move to where the opportunity is, you’re less
tied down.That’s something that you see as we extoll the virtues
and benefits of home ownership — you do see less labour mobility
and less flexibility on these fronts than societies that have
higher rental rates,” he told the
Devimco Immobilier, in cooperation with the Fonds immobilier de
solidarité FTQ and Fiera Properties, has announced the development
of the MAESTRIA mixed-use project, which will be the largest of its
kind so far in Montreal’s Quartier des spectacles.
Construction of the 2 towers (51 and 53 storeys tall) will
commence by the end of next year.The entire complex will offer
1,000 condo units and 500 rental spaces.
Marketing of units will start on February 2019, with the spaces
offered ranging from 300 up to 2,500 square feet.MAESTRIA will also
have 512 interior parking spaces, along with a diverse selection of
to grow increasingly unfriendly to first-time buyers
The $700-million development will be accessible to Jeanne-Mance,
De Bleury, and Sainte-Catherine streets.
“We are proud to be building a distinctive, avant-garde property
that will help enhance the urban fabric of this booming arts and
culture district,” Devimco Immobilier president Serge Goulet
“With this landmark project, we intend to maintain the Devimco
tradition of creating a living environment with mixed uses that
will serve project residents as well as visitors to this highly
popular part of Montreal.”
Are you looking to invest in property?If you like, we can get
one of our mortgage experts to