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Homes Under Construction In Canada Reach An All-Time High As Builders Are Tackling Supply Shortage

Homes Under Construction In Canada Reach An All-Time High As Builders Are Tackling Supply Shortage

The number of homes under construction in Canada has reached an all-time high as builders across the country continue to expand the housing stock, according to a recent RBC analysis report.

Housing starts over the past 12 months were the strongest since the mid-1970s, and the number of homes under construction is at an all-time high, said the report.

Historically low interest rates, stockpiled household savings and changing housing needs that are triggered by the pandemic have sent an unprecedented wave of Canadians rushing to buy a home.

“[Permit approvers and builders]’ answer has been dramatic. In the past 12 months, builders across the country have poured the foundations (defining a housing start) for the highest number of housing units (260,500) than at any time since 1977,” said the report.

“This represented a 26% or 53,600-unit increase relative to the 2015-2019 average pace (206,900 units).”

There are nearly 320,000 housing units under construction in Canada. This is by far the highest number, and a 12% (or more than 30,000-unit) increase from the end of 2019. About three-quarters of the total are apartments (mostly condos but also rental).

“Apartments (both condos and purpose-built rental) not only accounted for most (55%) of the housing starts over the past 12 months, but also showed the biggest increase (39%) from the 2015-2019 average.”

Supply chain issues are likely to persist as it takes time for new construction to reach the move-in stage. The report notes that the average timeline has more than doubled over the past two decades, from 9 months to 21 months, depending on the property type.

According to the report, housing starts barely increased in the Toronto region in the past 12 months compared to the 2015-2019 average, rising just 1.4% or 500 units. The relatively flat starts in this area, in part, reflect a significant drop in pre-construction condo sales in 2018 and 2019 following Ontario’s Fair Housing Plan in 2017.

“A recent spike in building-permit issuance suggests the pace could pick up,” said the report.

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
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GTA Home Prices Continue to Rise As New Listings Drop

GTA Home Prices Continue to Rise As New Listings Drop

Canadian home prices climbed in August as sales across the country saw a slight drop of 0.5% from July – and down by about 14% on a year-over-year basis from last August, according to the latest report from the Canadian Real Estate Association’s (CREA).

It’s the second-best August in history in terms of real estate transactions, said the CREA.

The actual (not seasonally adjusted) national average home price was $663,500 in August 2021, up 13.3% from the same month last year. The national average price is heavily influenced by sales in Greater Vancouver and the GTA, two of Canada’s most active and expensive housing markets.

Across the GTA, benchmark prices continued to be historically elevated, up 17.3% year over year to $1,059,300, the report states. The main factor behind the price increase is a lack of homes on the market.

Greater Toronto home buyers continued to be challenged by a steep shortage of supply, said the report.

The number of new listings plunged -42.6% in August, with 12,255 homes brought to market. That has contributed to a -2.7% decline in sales from July and a -20.2% drop from 2020, as 8,579 homes traded hands. That’s led to an SNLR of 70%, well into sellers’ market territory, and up 8.7% from the same time last year.

“Canadian housing markets appear to be stabilizing somewhere in between pre- and peak-pandemic levels – which is to say, still extremely unbalanced,” said a senior economist with the CREA.

CREA believes low inventory and rising prices are trends that will persist well into next year, especially as the vaccination rate increases, economies open, and immigration picks back up.

The organization says the national average home price is now expected to reach $680,000 this year, up 19.9% from last year. The earlier forecast had predicted an average price of nearly $678,000 for 2021.

Canadian home sales are forecast to fall by 12.1% to around 577,000 in 2022, while prices are expected to rise by 5.6% on an annual basis to reach about $718,000 next year.

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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Toronto New Condo Benchmark Price Surges to Over $1 Million

Toronto New Condo Benchmark Price Surges to Over $1 Million

The new home prices “reached record highs” last month amid falling inventory levels and the ongoing pandemic, according to the latest report from the GTA’s Building Industry and Land Development Association (BILD).

BILD, which represents more than 1,300 land development and home building companies in the Greater Toronto Area, released its new home sale and price figures from July of 2021.

For newly-built single-family homes in particular, the benchmark price (defined by realtors as the price of a typical home in an area) reached an average of $1,517,841 — a flabbergasting hike of 28.4 per cent over the same time last year.

This category includes not only detached homes, but linked and semi-detached houses and townhouses.

New condominium apartments, meanwhile, posted a benchmark price of $1,091,648 in July, according to BILD, representing an increase of 9.8 per cent since July of 2020.

Remaining inventory decreased in July compared to the previous month for both condominium apartments and single-family homes, to 9,483 units and 1,598 units respectively. Remaining inventory includes units in preconstruction projects, in projects currently under construction, and in completed buildings.

This may in part explain why overall sales fell last month — new single-family home sales were down 14 percent from the 10-year average and new condo sales fell 11 per cent, according to the home market intelligence specialists at Altus Group, which provides data to BILD.

“Low inventory levels for both condominium apartments and single-family homes are a persistent problem in the GTA that exerts upward pressure on prices,” said BILD President and CEO Dave Wilkes when releasing the July figures.

“We are encouraged to see that the issues of housing supply and affordability are prominent in the lead-up to the federal election — as they must be in elections at every level if we are to build the housing people in our region need, at prices they can afford. What we need is an alignment of federal, provincial and municipal housing policy on market-rate housing.”

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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Toronto Named Second Least Affordable City in North America

Toronto Named Second Least Affordable City in North America

Toronto is now less affordable than Los Angeles and New York City, according to Oxford’s recently-released North America Housing Affordability Index.

Vancouver, Toronto, and Hamilton are the least affordable cities in North America, said the new research report.

“Of the 25 North American metros for which we’ve built HAIs, Toronto, Vancouver (BC), Hamilton (Ontario), San Jose (CA), and Los Angeles are North America’s five least affordable metros,” write Oxford researchers in the firm’s latest report.

“Conversely, Chicago, Columbus (OH), Quebec City, Atlanta, and Raleigh (NC) are the five most affordable.”

Oxford Economics used new North America Housing Affordability Indices (HAIs) for 25 cities in the continent. The report compares whether the median income household in a city can afford the median-priced home.

Affordability will fall in both Canada and the U.S. over 2021 and 2022, Oxford predicts.

The National HAI for the U.S. reached 0.66 in Q1 of 2021, which means that the median single-family home price in America was 34 percent lower than what a median-income household could afford.

Canada’s national HAI, meanwhile, was found to be 1.34 in the first quarter of this year, meaning a home was 34 percent more expensive than what the median-income household could afford.

“Unaffordability is a persistent issue in Toronto and Vancouver, and the recent price surge has served to exacerbate this more than a decade-old trend,” reads the report.

“Hamilton and Ottawa have joined the ranks of Canada’s least affordable metros, while homes in the Prairies and Quebec remain within reach of local households.”

While Oxford predicts that affordable housing will become increasingly hard to find in both countries, the economics firm states that “housing is, and will remain, much more affordable in the U.S. than in Canada.”

“Canadian housing affordability has worsened considerably over the past decade, not only in Toronto and Vancouver, but also in several smaller metros,” reads the report.

“In Ontario’s major metros, affordability has worsened considerably over the past decade. Toronto’s index reached an all-time high of 1.53 in Q1 2021, while Hamilton, a smaller nearby metro, saw its index jump to 1.5 in Q1 2021, putting it among Canada’s most unaffordable metros.”

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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GTA Condo Sales Soared to Third-Highest Level on Record in Q2

GTA Condo Sales Soared to Third-Highest Level on Record in Q2

The Greater Toronto Area (GTA)’s condo market has been rebounding in full force, with new sales soaring to the third-highest level recorded during the second quarter of this year, according to a report from industry experts Urbanation.

Q2 data shows that new condominium apartment sales in the Greater Toronto Area totaled 9,001 units, which was 5.5 times higher than sales during Q2-2020 (1,637 units) and nearly matched the level in Q2-2019 (9,075), representing the third-highest quarterly total on record.

Affordability has given the 905 region an edge over the 416 in condo sales this year, triggering what some have described as a mass exodus from the city. The trend continued in Q2, with 58 percent of all GTA condo sales in Q2 occurring in Toronto’s suburbs and satellite cities.

Shaun Hildebrand, president of Urbanation, says the second quarter showed that the GTA new condominium market has not only fully recovered from COVID-19 but also returned to near record-high sales volumes. The 905 continued to be a driving force as developers and buyers have shifted to more affordable locations in the region.

In the resale market, the 7,790 units sold in the second quarter represented a Q2 record and annual growth of 148% when compared to Q2-2020.

Almost as many new condos were launched in Q2 as were sold, with 8,490 units achieving a record-high absorption rate of 81 percent. The average price for these units was $728,160 GTA-wide, with launch price averages of $834,504 in Toronto and $661,537 in the 905.

Unsold inventory is plummeting as buyers emerge from hibernation, dropping 10 percent in the quarter. The 11,716 unsold units mark the lowest number seen in eleven quarters and a comfortable 23 percent below the 10-year average.

The number of new condos under construction climbed by 11 percent year-over-year to a record-high 86,346 units.

However, with inventory approaching a three-year low, further upward pressure on new condo prices is expected in the near future.

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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Bidding wars return to Toronto’s rental market

Bidding wars return to Toronto’s rental market

Toronto’s rental market has made a strong comeback, and started to resemble its pre-COVID levels, following months of the pandemic-induced rising rental vacancies and declining monthly rents.

For the third straight month in a row, average rents for all property types in the GTA rose in June, up 0.9% month-over-month to $2,017. While the average monthly rent is still around $200 lower (9%) than a year ago and more than $440 off the average monthly rent at the market peak ($2,461) in November 2019, it still indicates that the market is turning a corner and trending back up again.

In the condo market — a major source of Toronto’s rental supply — activity is also booming, with lease activity showing major signs of improvement during Q2-2021, with activity reaching a record high. The number of leases signed for condominium rentals in the GTA more than doubled from a year ago, surging 108% to 12,747 units — the highest Q2 level on record.

The average monthly rent across all Toronto condos and apartments came in at $2,143 last month, according to the latest National Rent Report from Rentals.ca and Bullpen Research & Consulting.

This represents a year-over-year decrease of about four per cent, but an increase of four per cent on a monthly basis. Broken down by unit size, single-bedroom units rose one per cent between June and July to reach a new average of $1,855.

Two-bedrooms, meanwhile, rose 4.2 per cent to reach an average price of $2,606, with “larger and more centrally located luxury units” increasing in price at a faster rate than more affordable options.

“With the 75th and 90th percentile units increasing at a faster rate than the 10th and 25th percentile units in Toronto, the idea that larger and more centrally located luxury units are increasing in demand is reinforced,” said the newly-released report.

“This continues to bolster the idea that more and more tenants are searching for larger living spaces to accommodate working from home and going out less.”

Demand for this specific type of large, well-located unit has ushered in the return of bidding wars for rental suites — a phenomenon that near-completely disappeared amid the pandemic when rent prices tanked and landlords actually started courting potential tenants with unprecedented incentives.

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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Toronto’s house prices jumped higher than any major city in the world

Toronto’s house prices jumped higher than any major city in the world

Toronto has emerged as the city with the fastest rising house prices in the year to the end of June, according to the latest prime global cities index survey by Knight Frank.

Home prices in the capital of Ontario, Canada, rose by 8.2 per cent in the second quarter, its strongest showing since 2008, and are up 27 per cent in the past 12 months.

Knight Frank’s quarterly Prime Global Cities Index tracks the performance of residential prices across “key global cities” (of which there are apparently 46) using data from its global research network.

“Prime prices across 46 cities increased at an average rate of 8.2% in the year to June 2021, up from 4.6% in March,” writes the U.K.-based real estate consultancy.

“Toronto leads this quarter’s results recording annual prime price growth of 27 per cent, driven by strong buyer appetite and low inventory levels.”

Between the first and second quarters of 2021 alone, prime house prices shot up a whopping 15.5 per cent in Toronto, far and away above the next cities on the list (Shanghai, Guangzhou, Seoul and Miami.)

It’s important to note that, while all types of home prices are rising at record levels in Toronto as the city recovers from COVID, the Knight Frank index only measures “prime” properties, which they define as “the most desirable, and normally most expensive, property in a defined location.” In Toronto, detached single-family homes fit this definition.

“Until now, the pandemic-fuelled house prime boom was most evident in the mainstream market but the prime sector has now surged ahead,” reads the report.

“Interestingly, the proportion of cities registering prime price growth has increased only marginally to 76 per cent. Instead, it’s the scale of growth amongst the top-performing cities that is behind the index’s acceleration.”

Toronto is certainly showing price growth across both the mainstream and prime sectors, and this trend is expected to continue well into latter 2021.

As for why, Knight Frank points to a combination of low interest rates combined with easing travel rules, a surge in “safe haven purchases” and “an overall reassessment of lifestyles and commuting patterns.”

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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Condos are getting hot again in Canada’s biggest cities, fueled by rental demand

Condos are getting hot again in Canada's biggest cities, fueled by rental demand

Condominium markets in some of Canada’s biggest cities have rebounded strongly this year, and the market is predicted to once again return to pre-pandemic red-hot conditions as rental demand surges and inventories evaporate.

The condo market, which had been hot for years, cooled quickly last year during the pandemic as investors fled, spooked by the exodus of renters from cities to live with families or find cheaper places elsewhere.

Short-term rental demand dried up and first-time buyers flocked to the suburbs and smaller towns to work from home.

This year, the rental market is rebounding on the prospect of white-collar employees and students returning to offices and universities and a strong bounce back in immigration to make up for pandemic-driven declines. Younger buyers are also returning to condos after prices for bigger homes surged during the pandemic.

In the second quarter, the downtown market made up the highest proportion of greater Toronto area condo resales in a decade.

About 12,700 condos sold across the greater Toronto area from January to April, surpassing the 10,300 transactions ahead of the previous market peak in 2017. And while they fell following a March high, they remained 15 per cent higher than pre-pandemic levels.

Across Vancouver, where condo sales previously peaked in March 2016 at more than 2,250, they rose to almost 2,700 in March. Sales in July, while down from March, were 36 per cent above pre-pandemic levels.

Prices have pulled back from March highs, largely due to continued lockdowns in some areas and seasonal trends, raising concerns in some quarters that the market has peaked. But real estate agents said a tightening rental market should boost investor demand, giving the market another leg up.

The jump in demand has helped rapidly absorb last year’s glut of rental properties. Rental supplies in Toronto have fallen to half a month of inventories from about three months’ worth in November, said a senior real estate agent.

Shrinking available supply is further boosting the condo sales market. Construction started on about 1,143 apartment and condo units in June in the Toronto metropolitan area, down over a third from a year ago and almost half the level of two years ago.

And while ongoing construction of condos was at a record 86,149 units in the second quarter, about 92 per cent of this was already pre-sold.

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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One North York Neighborhood Is A Hotspot In Condo Market

One North York Neighborhood Is A Hotspot In Condo Market

As Toronto’s condo market is on track to bounce back with an upward price trajectory amid the ongoing pandemic, one area in Toronto has been consistently seeing condo prices increase.

In North York, one-bedroom units have seen four consecutive months of price increases, according to a report from Strata. In March, the average sale price for this unit type was $503,000. By the end of July, it had gone up to $528,000 for an increase of $25,000 in just a few months alone.

Two-bedroom units also became more expensive, hitting a yearly high in July; North York homebuyers paid $698,400, an increase of over $45,000 since March.

The growing desirability of the North York market has also resulted in properties selling for well over asking. In July, one-bedrooms sold for 3.32 per cent above list price, a stark contrast from the beginning of the year when they were selling below.

Willowdale, an area close to both the DVP and 401 as well as stops on the Yonge and Sheppard subway lines, is the hottest pocket in North York right now.

It also includes the major arterial road of Yonge Street, stops along both the Yonge and Sheppard subway lines, plus easy access to the popular Fairview Mall. The area is already home to many condominiums with more to come, due to the city’s policy of densification around existing mass transit.

Those purchasing a one-bedroom in Willowdale last month paid on average about $60,000 more compared to June.
Condo prices in surrounding areas, are higher, but have remained relatively unchanged in the last few months.

In downtown Toronto, for example, average condo prices have hovered at about $790,000 since April. And in midtown, condo values there have actually plunged by nearly $150,000 since April’s peak of $1,026,083.

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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Ontario Place redevelopment plan unveiled for world-class destination

Ontario Place redevelopment plan unveiled for world-class destination

The Ontario government has announced details of its plan to revitalize Ontario Place into a world-class destination. Three companies from the 2019 Call for Development process have been selected to “help deliver an exciting, inclusive and family friendly experience”.

The transformation of Ontario Place will include three new major attractions, which will be undertook by the three winning bidders:

Therme Group is building Therme Canada | Ontario Place, a family-friendly, all-season destination offering something for all ages, including pools, waterslides, botanical spaces to relax, as well as sports performance and recovery services. Outside, people will enjoy more than eight acres of free, publicly accessible gathering spaces, parkland, gardens and beaches.

Live Nation is redeveloping the existing amphitheatre into a modern, year-round indoor-outdoor live music and performance venue that will attract world-class artists and events. Protecting the iconic amphitheatre lawns, the new venue will have an expanded capacity of 20,000 in the summer and close to 9,000 in the winter, offering a unique indoor-outdoor experience with operable exterior walls to accommodate events, rain or shine.

Écorécréo Group is building an affordable, all-season adventure park for all ages. This new, environmentally friendly attraction will include aerial obstacle courses, net-based aerial adventures, ziplines, climbing walls, escape rooms and many other activities. Écorécréo Group will also operate Segway, quad-cycle, canoe and kayak rentals at the site.

The land the new attractions will be located on is not being sold by the province, and the government promises that the grounds with their lakeside access will be open year-round, including during construction periods. No condos are planned, nor will there be a casino, a previous plan by the Ontario Gaming Commission that was given thumbs down by Toronto City Council in 2012.

The province, which appointed former Toronto Police Chief Mark Saunders as Special Advisor for Ontario Place in 2019, says that he “will continue to engage with the City of Toronto, Indigenous communities, key stakeholders, businesses and community groups that have interest in the Ontario Place site to ensure all perspectives on this important project are recognized and considered.”

The government is also talking with the Ontario Science Centre about creating “science-related tourism and educational programming at the Cinesphere and pod complex,” although no further details are yet known.

The public, meanwhile, will be given an opportunity in late August to share their vision for the site, while public information sessions will be held virtually in the fall, “with planning and development consultations related to the site-wide environmental assessment, heritage, and site servicing to follow in early 2022.”

Quick Facts
Redevelopment is expected to create over 3,600 construction jobs and staff positions once the attractions open to the public, with approximately five million visitors expected annually.
The Ontario Place site is a unique waterfront site, made up of approximately 155 acres of land and water, and served as an iconic cultural and tourism destination for all Ontarians between 1971 and 2012.
Currently, more than one million people visit Ontario Place every year.

*Please note that this article only reflects the views of the author, and does not represent the stance of the company.

*The information provided here is for general information purpose only, which does not necessarily reflect the views or opinions of Bay Street Group. We assume no responsibility for its accuracy, completeness, or sufficiency.
*As for intellectual property rights of others, anyone who believes that their work has been reproduced in a way that constitutes copyright infringement may contact us.

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