by Paolo Taruc
The Urban Development Institute (UDI) has criticized the
decision of Vancouver authorities last week to deny the Beedie
Living mixed-used condo project in Chinatown.
“This ruling creates significant uncertainty because our members
don’t know if they can rely on zoning, urban area plans, advice of
city staff or recommendations of the Urban Design Panel,” said UDI
president and CEO Anne McMullin in a statement.
She described the move as a “surprise decision,” as the proposal
was revised five times over four years and received the support of
expert city staff, the city’s Urban Design Panel of design
McMullin warned that the denials sends a “negative chill”
throughout the industry at a time when when housing supply in
market, rental and affordable homes has reached historic lows.
“Our members, and the thousands of individuals represented in
all facets of development and building, are concerned this decision
undermines the integrity and reliability of the City’s rigorous
planning regime, and puts into question future projects, not only
in Chinatown, but across the City,” she added.
Opponents of the development believe its construction would
gentrify the area and price out the community’s marginalized
residents.“In the neighbouring 189 Keefer building, we have seen 1
bedroom condos being sold for just under half
Markham is in the midst of a boom.The city’s downtown is home
to a slew of residential and commercial development, but most
notably it’s become the centre of Canada’s tech industry.
According to Sunny Sharma, president of Century 21 Leading Edge
VIP Realty Inc.Brokerage, Markham’s diverse population and thriving
technology industry make purchasing a condo there a sure bet to
“They have the most bio tech companies there,” said Sharma.“York
University is putting a new campus in downtown Markham, and it is
tied in on a new bus lane that goes straight through to Vaughan
along Hwy 7.They’re looping everything to make sure there’s better
The dedicated bus lane is a straight shot to the new TTC subway
station at Vaughan Metropolitan Centre that’s scheduled to open
next month.Better transit connectivity – and by extension,
employment – says Sharma, is one of the keys to buying an
“Basic employment will give local residents jobs and create
secondary levels of employment, which brings in more restaurants,
uber drivers, transportation, and different layers of employment,”
he said.“Downtown Markham is being urbanized and intensified.”
Additionally, Sharma says the downtown core is as hot as ever,
particularly in the entertainment and financial districts, and in
the East Bayfront, a burgeoning neighbourhood that’s comprises a
In what came as a shock to observers and authorities alike,
the nation’s gross domestic product contracted in August after a
flat reading in July, Statistics Canada reported last week.
The latest disappointment is another sign that the process of
cooling is well underway from the blistering pace of growth in the
12 months through June, according to fiscal sector players.
“The run of amazing Canadian economic data is officially over,
with growth coming back to reality in hurry,” Bank of Montreal
chief economist Doug Porter stated in a note to investors, as
quoted by Bloomberg.“The two-month lull in activity pounds home the
point that the frothy growth of the past year is over and
If the economy fails to expand in September, third-quarter
annualized growth would be on pace for a sub-2% increase, after a
gain of 4.5% in the second quarter.The Bank of Canada projected
growth of 1.8% in the third quarter.Economists surveyed by
Bloomberg News forecast an average 2.1% expansion in the second
Read more:Ontario’s vicious cycle of sluggish income
growth and sustained real estate strength
The nation’s currency dropped as much as 0.6% to C$1.2915
against the U.S.dollar as of November 1, which may fuel concern the
Bank of Canada’s caution about raising interest rates
According to The Conference Board of Canada’s latest report
titled Compensation Planning Outlook 2018, Canadians
should not expect a substantial addition to their households’
coffers in 2018.
The study revealed that non-unionized employees across the
country will see only a 2.4% increase in their salary next year,
just slightly higher than the 2017 growth of 2.2%.Projected
increases are highest in the pharmaceutical and chemical products
industry at 2.7%, and lowest in the health sector at 1.6%.
Increases of 2.6% are expected in the real estate industry,
along with organizations in construction, finance, and
debt-to-disposable income load rises in Q2
The highest-demand postings remain IT specialists, management,
accounting/finance, engineering, and skilled trades.
On a regional basis, Manitoba, Ontario, and Quebec lead the way
in terms of projected increases, with wage gains ranging from 2.6%
to 2.5%.Meanwhile, the lowest average base pay increases are
expected in Alberta and Saskatchewan, at 2.1%.
“While the Canadian economy is firing on all cylinders this
year, growth projections for next year and beyond show a slowing
down of the economy.As a result, business leaders continue to
exercise caution, keeping a cap on organizational spending and, by
extension, salary increases,” according to Allison Cowan, director
of Total Rewards Research, The Conference Board of Canada.
Canadian real estate attracts interest from around the world,
and now American company Zillow has announced that it plans to add
Canadian listings early next year.However, that could ruffle
feathers with the country’s largest real estate board.
Zillow publishes properties’ sold data, which has been at the
heart of litigation between the Toronto Real Estate Board and the
federal competition bureau, who sued the former over
John Pasalis, president of Realosophy, a key competition bureau
witness during the years-long litigation, says Zillow might not
have any problems entering the Toronto market, however, that would
be contingent upon its data’s provenance.
“I’d be surprised if they can do it if TREB wins the appeal,” he
said.“If TREB loses, then it might be easier for them to do it,
because they’ll have a right to, but I still think there might
potentially be some issues.But it does depend on where they get
their data from. If they’ve signed an agreement with Teranet
or some other source, it’s going to be a lot different than if they
get their data from the real estate board.”
Pasalis believes that TREB’s efforts are in vain.Although
Realosophy has been prominent in the conflict with TREB, Pasalis
says fighting data accessibility is pointless in this day and
According to the latest property transfer data released by the
British Columbia government, the proportion of sales involving
foreign nationals in Metro Vancouver inched up between April and
The data showed that 5% of the 6,105 property transfers in
September involved foreign nationals, up from 2.5% in April.
This remained far below the percentage of foreign nationals
buying homes before the former Liberal government implemented a 15%
foreign buyers’ tax in August 2016 in an effort to cool the hot
housing market, The Canadian Press reported.
The B.C.Finance Ministry previously reported that from June 10
to August 1, 2016, 13.2% of all property transfer transactions in
Metro Vancouver involved foreign buyers.
Despite attempts to improve housing affordability, the Real
Estate Board of Greater Vancouver said in August this year that the
typical price of a home in Metro Vancouver had surpassed $1
Read more:Vancouver condo market in demand
The New Democrat government has said that it is reviewing
transaction data along with the foreign buyers’ tax and an
interest-free loan program for first-time homebuyers in an effort
to decide whether such measures should be kept, revised, or
Among municipalities, Richmond saw the highest rate of foreign
buyers between April and September this year at 8%,
Average annual prices of Toronto residential properties remain
stable due to sustained gains in the condo segment, and the further
tightening of mortgage rules could add a temporary boost this
autumn, observers argued.
The decision by the Office of the Superintendent of Financial
Institutions to impose more stringent stress tests could lead to a
scramble as the rules, which take effect on January, might slash a
family’s purchasing power by as much as 21%.
“The recent changes announced by OSFI might actually result in a
short-term rush as those that are impacted by these changes rush to
buy,” Realosophy.com president John Pasalis told BNN.“What
happens after [the Jan.1 deadline] is anyone’s guess right now, but
I expect the spring market in 2018 to be cooler that it has been in
This is despite the overall market being “more balanced” than it
was a year ago, Pasalis said.The executive noted the growing
evidence of “stark divergences” in the market between condos and
“Average prices are up 2% over last year, but this is due to the
condo market which saw prices rise 17%,” Pasalis
explained.“Freehold prices were flat over last year.”
condo prices could slow
The divergences are even more obvious when one examines
Commercial real estate in Canada’s six major markets is, by
and large, healthy, but Alberta continues reeling from the
aftershocks of the oil sector’s plummet a few years ago, according
to the National Dashboard Report by Colliers.
Robust office space absorption in Vancouver is being largely
driven by the technology, advertising, media and information
industries, accounting for 40%, while education institutions are
expanding throughout the metropolitan area and comprises 12% of the
absorption.Colliers reported the vacancy rate dropped from 6.3% in
Q2 to 6% in Q3.Education tenants, which figure transit access into
location planning, rose from 35,000 square feet in 2016 to 300,000
Q3 of 2017.The National Dashboard Report also noted that
Vancouver’s Broadway Corridor/Mount Pleasant area is flourishing
with over half a million square feet of office space under
construction or pre-leasing.
Vancouver’s industrial demand is in strong demand, and the
third-quarter vacancy rate in Metro Vancouver is 1.8%, down
slightly from Q2’s 1.9%, and remains below the five-year average of
3.1%.Between the third quarters of 2015 to 2017, the vacancy rate
has been under 2.5%, in part, because of restricted new supply.
The Greater Toronto Area’s vacancy rate during Q3 was 5.3%,
while the availability rate was 7.7%, both of which decreased from
the second quarter.The average asking net and gross rates also
decreased from the previous
An Urbanation report predicts a balanced condo market moving
into next year – and with it a moderation of investor activity.
“We’re coming off unsustainable rates of growth,” said Shaun
Hildebrand, Urbanation’s senior vice president.“It’s not healthy
for a market to see these rates of appreciation.If we did, the
ramifications would be more severe than expected, so expect the
market to transition more quickly away from rapid rate of growth
and record level of sales as we move into 2018.
“That will come as there will be less aggressive investor
demand, who have been the largest buyers of new condominiums.”
Hildebrand says that while investors have cashed in on high
condo rents – prices hit $2.98 per square foot during the third
quarter of 2017 – and capital appreciation, there are sobering
risks they won’t be able to ignore going into next year.
“You have to take into consideration that rents have been
growing strongly, but not growing anywhere near as quickly as
prices, so that puts at risk holding costs for investors being
higher than achievable rent levels when the units come into
completion,” said Hildebrand.
The report forecasts a possible injection of supply somewhere in
the neighbourhood of 12,000 units during the fourth quarter, and
that should boost annual sales
The latest census data revealed that condominium units are
fast becoming the residence type of choice among Canadians, with
fully one in five households in the Toronto Census Metropolitan
Area (CMA) residing in condos.
This development is especially pronounced among first-time
millennial buyers, the census results showed.Among members of this
demographic, condos have become a popular ownership choice amid
ever-rising prices, a trend that doesn’t appear to be waning any
“The proportion of households living in condominium units is
likely to rise,” City Planning’s Michael Wright told the Toronto
“The bulk of the city’s potential housing supply includes
condominium units.For the five-year period ending June 30, 51% of
the proposed development projects in the city’s pipeline involve at
least one condominium application, and these projects represent 85%
of the residential units proposed, under construction or recently
built,” he added.
According to Royal LePage CEO Phil Soper, condos stand as solid
evidence of Toronto’s world-class status.
“One third of housing stock we’ve added since 2011 is
condominium.When I was a kid (in 1980) it was 6%.That’s a dramatic
change.Clearly we’re adjusting the product people buy into.It’s
clear we’ve joined other global cities in a changing social norm
where many people don’t expect the white picket fence,” Soper
But condos can only go
Cranes crowd the Montreal skyline these days as a strong
economy and political stability are fuelling a construction frenzy
throughout the downtown core and beyond.
Although tame by Toronto and Vancouver standards, developers in
Canada’s second-largest city are investing billions of dollars in
new condominium and office complexes, along with retrofitting older
“Since 1976, this is one of the greatest times,” Mayor Denis
Coderre told The Canadian Press.The mayor was alluding to the year
when the election of the separatist Parti Quebecois prompted an
exodus of residents and businesses.
“There [are] right now 150 cranes representing $25 billion of
investment in Montreal,” he said at the official launch of the
second phase of the YUL twin tower and townhouse project that is
sponsored by Chinese investors.
Project developer Kheng Ly of Brivia Group Real Estate, who has
partnered with China’s Tianco Group, said relatively low condo
prices and the lack of a foreign buyers tax make Montreal an
attractive place to invest.
Ly, who arrived in Canada 29 years ago, said the downtown
landscape has changed significantly in the past five years.The
recent addition of direct flights between China and Montreal have
attracted Asian investors who comprise 35% to 40% of condo owners
at the project’s first phase, he said.
Housing affordability continues to dominate the conversation
in the Greater Toronto Area’s housing market.A new report released
by the Urban Land Institute in conjunction with PwC, called
Emerging Trends in Real Estate described governmental regulation as
likely to exacerbate the affordability problem.
The laws of supply and demand lie at the heart of surging
housing prices.Not only are single-family detached homes in high
demand and low supply, but the condo market, too, is beginning to
see signs of strain, as priced-out buyers realize they have no
other choice to settle for skyward balconies over backyards.
The foreign buyer tax cooled the Vancouver and Toronto markets,
where prices grew astronomically, but the report makes mention of
suspicious players within the real estate industry, one of whom
believes growth will continue with or without the tax because of
natural growth.The report also noted that prices cooled temporally
before rebounding and pushing condo prices upwards.
Those interviewed by the report parroted the need for government
to stay out of the market, except to address the need for increased
supply.It’s unanimously believed that the approvals process is one
reason supply isn’t keeping up with demand.
Affordability will catalyze a growing trend:co-living.As the
number of single people among the millennial cohort in expensive
markets like, Toronto and Vancouver, continue rising,
A massive residential complex in Hamilton will be opening its
units for sale on November 4, 2017, its developer announced.
The $360-million Television City project, which was the
brainchild of Lamb Development Corp.in partnership with Movengo
Developments, is the first phase of the company’s investment in
Hamilton, with several more projects worth over $1 billion
scheduled further down the line.
Two connected 40-storey and 30-storey towers will house
approximately 618 units.Upon completion, Television City will offer
474,080 sq.ft.for residential units and 11,344 sq.ft.for retail
The complex is designed with a wide variety of luxury amenities,
including an outdoor infinity pool, fitness centre, and skyclub,
along with a co-op tech workspace, a children’s play centre, a
private dog walk, and a pet-washing station.
Units ranging from studios to penthouses start at
$220,000.Move-ins are slated for 2021.
“As a developer, my main interest lies in building
communities.Hamilton is a vibrant, evolving city, made even greater
by its people,” Lamb Development Corp.CEO Brad Lamb said in a news
“From homeowners to councillors to entrepreneurs, we have had
the opportunity to sit down with Hamilton citizens who are excited
to see the city’s potential come to life.We are happy to be a part
of this stage in its history.”
Interested parties can learn more
This week’s census data revealed Canadians’ changing living
habits – and the trickle-down effect that’s affecting the rental
market and its existing stock in Toronto.
Only 50.2% of Millenials own their own homes, compared with 56%
of boomers who owned when they were that age, according to the
Census.However, Phil Soper, president and CEO of Royal LePage
referred CREW to a summer study the organization commissioned on
peak Millenials (aged 25 to 30) that found 87% believed
homeownership was a positive thing and intended to someday own a
home, and in which 69% said they intended to buy a home within five
“If you compare that to Stats Can data, it shows people are
leaving their parents’ homes later, staying in school later, and
essentially growing up at a slower rate than their parents, which
makes perfect sense,” said Soper.“With technology and increasing
lifespans, the old standard of when we got married and left the
house got stretched, so it makes perfect sense to me.”
Housing affordability has also contributed to more
millennial-aged Torontonians renting than their parents did at
their ages.The city is experiencing inventory shortages on the
ownership and rental fronts, and Soper says condo rentals will
likely comprise a large part of the incoming supply.
“I think one of the things
As Canadian cities continue to crack down on online
home-rental platforms, Airbnb maintains it’s open to regulation
provided new rules don’t penalize casual users and recognize not
every host runs a full-fledged business.
“There are still a lot of misperceptions about what home-sharing
is all about,” according to Alex Dagg, Airbnb’s director of
Canadian public policy, who also warned about unintended
consequences from rushed regulations.
“That’s the concern – that you come up with something that you
think makes sense.And without understanding really what your
community is looking like and how they’re using the platform and
how they’re benefiting from it, you can really design something
that isn’t helpful,” Dagg explained, as quoted by The Canadian
Many homeowners or tenants use the platform to rent out a
portion of or their entire home to earn some extra cash.Airbnb’s
critics argue that it has created additional housing problems in
cities with low vacancy rates and high home ownership costs.
The Vancouver and Toronto governments have indicated that they
are weighing the possibility of imposing a number of restrictions
Dagg is in Vancouver to argue the American company’s case in
front of a city council holding public hearings into a proposed
home-sharing bylaw.If approved, it would take effect in April and
require hosts to