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Courting townhomes Mosaic Avenue Realty Ltd. has picked up a 7.1-acre development site in the Baycrest area of Burke Mountain in Coquitlam from Harwood Group for $15.3 million.

Mosaic must rezone the site prior to starting construction, but Coquitlam planning documents allow approximately 115 townhomes on the site, making it a rare opportunity for developers. The exclusive nature of the offering contributed to strong demand and pricing. Bids were received from eight parties, representing a broad spectrum of developers and investors.

“You can’t find that mass, pretty well anywhere north of the Fraser,” said Owen Yates, a partner in Frontline Real Estate Services Ltd., which represented Harwood in the transaction. “Townhouse is the form of development that everybody is seeking at the moment, and it’s hard to find sites and hard to make the numbers make sense on a lot of these assemblies.”

In this case, the availability of a single large site designated for a specific use made the opportunity appealing.

While the property has some constraints, including power lines crossing it and a need to realign roads to maximize the developable area, Yates said there’s plenty of upside for Mosaic.

“There’s value for them, in that they get in there, and they get to create what they want on the site,” he said.

Value chain The scramble for development sites this year has been well documented; RealNet Canada Inc. reported in September that deals for land continue at “peak levels,” while Avison Young’s semi-annual investment report attributed the active market to updates in the community plans of many municipalities.

But sometimes it just comes down to simple supply and demand – and demand definitely has the upper hand these days, prompting some owners to prep projects for development, then offer them for sale, and hungry buyers to make unsolicited bids for sites.

A few recent examples underscore the point: Avison Young has listed 4406 West 10th Avenue, which has an approved design for a proposed development, and 2050-2060 Alma Street, a permit-ready 22-unit development site at West 5th Avenue.

Similarly, this past summer Anthem Properties Group made an unsolicited offer through Frontline for 725 Marine Drive in North Vancouver, which Darwin Properties Ltd. had taken through rezoning. Anthem, eyeing an opportunity to add value, paid $9.2 million to take the project through development.

At the same time, Frontline was handling Adera Development Corp.’s purchase of three parcels in Surrey from Cressey Development Corp. totalling 9.6 acres.

The first parcel was acquired this summer, while the purchase of the final two closes this week. The total purchase price of $28 million reflects the strong demand for the parcels, which Cressey had steered through civic processes with a view to building townhouses.

“[Cressey] wasn’t looking to sell, but people were offering some aggressive pricing [and] they elected to sell,” said Frontline’s Yates.

Adera is proceeding with development of a first phase of 70 homes; the scale of subsequent phases is yet to be determined.

Townhome demand Underscoring the demand for townhome development sites was the suggestion by senior market analyst Robyn Adamache at Canada Mortgage and Housing Corp.’s recent housing outlook conference that townhomes are scarce enough to be the new single detached home. Just 297 townhouse units remain completed and unabsorbed in the market, fewer than any other type, while just two months’ worth of listings exist on the resale side.

Copyright © Frontline Real Estate Services

 

Demand showing no signs of waning, although price rise in metropolitan area will be slower than the 17 per cent seen in 2015, predicts brokerage

Joannah Connolly
Other

With home prices in Greater Vancouver up more than 17 per cent year over year and demand showing no signs of waning, average local house prices will rise another seven per cent in 2016, according to a forecast published December 10 by real estate brokerage RE/MAX.

This is nearly three times the growth rate projected for Canada as a whole, across which house prices are forecast to rise 2.5 per cent next year.

“Based on the projections for Canada’s key housing markets, RE/MAX expects the average home price in Canada to increase 2.5% in 2016,” said Gurinder Sandhu, executive vice-president, RE/MAX INTEGRA Ontario-Atlantic Canada Region.

“While we expect to see some price decreases, particularly in regions that rely on the oil and natural resource sectors, strong demand in Canada’s urban centres is expected to continue throughout next year.”

RE/MAX also predicted residential real estate price rises in 2016 of three per cent in the Fraser Valley, 2.7 per cent in Victoria and just two per cent in Kelowna.

The forecast for Greater Vancouver had echoes of last year’s predictions from the same brokerage. At the beginning of 2015, RE/MAX predicted that prices in Greater Vancouver would rise three per cent across the year, following 14 per cent annual rises seen in 2014. After strong first-quarter sales, the brokerage doubled its forecast in April 2015 to six per cent, which was considered bullish at the time. As of November 2015, house prices were up nearly 18 per cent year over year.

RE/MAX also reported December 10 the results of a recent Leger survey conducted for the brokerage, which found that British Columbians were the most convinced of all Canadians that home ownership is an essential part of “the Canadian dream.”

Of the respondents who agreed with the statement “home ownership is part of the Canadian dream,” BC residents were the most in agreement, at 94.6 per cent of respondents. This compares with 90.0 per cent of respondents nationwide agreeing with the statement.

More than two-thirds of Canadians surveyed agreed that, when buying a home, 10 per cent or more is a sufficient down payment. And 70 per cent of homeowner respondents agreed that REALTORS® provide value when buying or selling a home.

© 2015 Real Estate Weekly

Property assessment agency sends out early letters to owners of properties that are seeing far-above-average increases for 2016

Joannah Connolly
Other

Owners of homes that saw a significant increase in value up in the first half of 2015 will receive early warning letters about their 2016 assessments ahead of the usual January notices, BC Assessment announced December 8.

The agency said, “Following a very active year in which residential values continue to climb, some property owners across the Greater Vancouver region can expect their 2016 property assessments to increase notably more than the average and, therefore, are currently receiving an early notification from BC Assessment.”

Assessor Jason Grant said, “The recently finalized 2016 assessments are indicating significant increases from 2015. Increases of 15 to 25 per cent will be typical for single-family homes in Vancouver, the North Shore, Burnaby, Tri-Cities, New Westminster, Richmond and Surrey.

“Typical strata residential increases will be in the five to 10 per cent range.”

Grant continued, “Across the province, we have just issued about 37,000 early notification letters, with almost two thirds of those going to Greater Vancouver property owners. Early notification letters are mailed to property owners who can expect an increase of at least 15 per cent above the average increase in their local taxing jurisdiction. We want to ensure impacted property owners are aware of the significant increases and we welcome them to contact us if they have any questions or concerns.”

The agency said that new assessments for all properties will be released on January 4, 2016, and all the remaining 2016 assessment motices will be mailed to property owners during the first week of January.

“The market for single family homes between July 1 and the end of November has continued to rise dramatically, so property owners should be reminded that their 2016 assessments are based on the market value as of July 1, 2015,” added Grant.

The table below provides examples of single-family home assessment increases in a selection of Greater Vancouver communities. These are actual assessments of individual homes, and are not an average.

© 2015 Real Estate Weekly

Allen Garr
Van. Courier

Housing affordability, which started as an “issue” before becoming a “problem” and finally a “crisis,” shows every sign of simply getting worse. And it doesn’t really matter whether you want to own or rent.

In a real estate market that is both globally desirable and significantly constrained in terms of available product — as Vancouver is — house prices have been recently increasing by double digits.

The breathtaking rise is driven, as research tells us, by off-shore dough. Buying at the high end of the market creates a domino effect leaving those who were once able to squeeze in at the bottom, seeking home ownership well beyond the city’s limits.

But there is more. Condo ownership for previous generations was the bottom rung of the ladder leading to the ultimate goal of single-family home ownership, white picket fence etc. etc. You know, build up your equity then move along just before the kiddies start arriving or at least before they are big enough to need their own bedroom.

Now condo ownership isn’t the first step; quite often it is the last. But not so fast.

I direct you to last Friday’s Globe and Mail’s business pages and a report from Canada Mortgage and Housing Corporation; the headline reads “More foreign buyers own Canadian condos.”

CMHC found that in Vancouver 3.5 per cent of condos are owned by people whose primary residence is outside of Canada. (That’s the highest of all three cities where the numbers are notably rising including Toronto and Winnipeg.) Here, it is up from 2.3 per cent in 2014. While the percentage may seem relatively small, the net effect is to drive up condo prices right across the market.

And how about those rentals? I mean, after all, more than 50 per cent of the folks in Vancouver are renters. Well, there too is little to cheer about. According to the city’s housing policy staff, a “healthy” vacancy rate is between three per cent and five per cent. The vacancy rate in Vancouver is .5 per cent.

This week council is considering what it calls “new protections for Vancouver’s tenants and rental housing stock.” There would be more money from landlords to support tenants who have to move including, for some, months of free rent and funds for moving expenses.

The city is, however, powerless to control rents or what are referred to as “renovictions” where tenants are tossed out so landlords can add a lick of paint and a new bathroom sink then jack up the rent.

There is one not insignificant lever the city has: Rate of Change Regulations. These are regulations that have been around since the late 1980s and cover 47,000 of Vancouver’s 67,000 rental units in buildings with six or more suites.

Since 2007, none of those 47,000 suites can be demolished unless they are replaced on a one-to-one basis. The problem is that while the number of units being protected remains the same, the population has increased; the vacancy rate dropped by half.

The B.C. Non Profit Housing Association released a report last month covering 521 Canadian municipalities and measuring “rental housing health.” It’s based on a 2011 National Housing Survey and measures affordability, percentage of tenants spending more than 50 per cent of their income on housing, overcrowding and the amount of money tenants would need to meet the national standard of spending less than 30 per cent of their income on housing.

Of those 521 municipalities, Vancouver came in at 516.  But we can be thankful we are not Burnaby. In spite of the fact that rents are somewhat lower there, they came dead last.

While Vancouver protects rentals with Rate of Change Regulations, no such regulations exist out in Mayor Derek Corrigan’s one-party state. In fact modestly priced rental units are coming down at a record rate to be replaced by high-priced condos.

One other point: While foreign funds continue to roll in and Victoria and Ottawa dither about what to do, a growing number of people from Maple Ridge to Saanich to Prince George find themselves living in tent cities. These are not only drug addicts or the mentally ill. Increasingly, they are workers living paycheque to paycheque unable to find affordable housing in the midst of this worsening crisis.

© 2015 Vancouver Courier

Steve Randall
Other

Sales in the Greater Toronto Area were 14 per cent higher in November 2015 compared to a year earlier. The Toronto Real Estate Board says that the 7,385 sales through its MLS was a new record for the month. For the first 11 months of the year there were 96,401 sales, which is also a new record.

“Not only did we see a record sales result for November, but with one month left to go in 2015, we have already set a new calendar year record for home sales in the TREB market area, eclipsing the previous record set in 2007.  Sales were up on a year-over-year basis for all major home types, both in the City of Toronto and surrounding regions.  This suggests that the demand for ownership housing is widespread, from first-time buyers to long-time homeowners across the GTA,” said president Mark McLean.

The average selling price for all transactions was up by an annual rate of 9.6 per cent to $632,685.

Copyright © 2015 Key Media Pty Ltd

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Foreign owners made up a bigger share of the condominium markets in Toronto and Vancouver over the last year, according to the nation’s housing agency.

Foreign owners of condos comprised 3.5 percent of the market in Vancouver and 3.3 percent in Toronto, according to a report from Canada Mortgage & Housing Corp. which surveyed property managers. That’s up from 2.3 percent in Vancouver last year and 2.4 percent in Toronto, Canada’s largest city. When narrowing to the downtown core, foreign buyers made up 5.4 percent of Vancouver condo buyers this year versus 3.4 last year and 5.8 percent of Toronto condo buyers versus 4.3 percent.

Politicians have been under pressure from many quarters including Vancouver Mayor Gregor Robertson, HSBC Holdings Plc and local residents to start monitoring offshore money that may be pushing up home prices, particularly in Vancouver. The average price for a detached home rose 9 percent to C$1.02 million ($760,000) in Toronto in November from a year ago while Vancouver home prices soared 18 percent to C$752,500.

So far, the agency’s data is limited to condominiums and based only on a survey of property managers. Offshore buyers can keep their location and identity secret, Evan Siddall, chief executive officer of CMHC said in a speech last month.

The Ottawa-based agency released the data as part of its Housing Market Insight series, and will publish about 40 more reports on different cities and housing topics throughout 2016.

Copyright © 2015 Key Media Pty Ltd

Home sales up a staggering 40 per cent year over year despite dearth of listings; prices up nearly 18 per cent, says real estate board

Joannah Connolly
Other

Metro Vancouver real estate sales in November reached near-record levels for the month, defying the anticipated seasonal slowdown, according to Real Estate Board of Greater Vancouver (REBGV) figures released December 2.

Total home sales were up 40.1 per cent annually in November and overall benchmark prices 17.8 per cent compared with November 2014 – both these annual growth rates mimicking those seen in the scorching spring market earlier this year.

November also saw year-over-year condo price growth hit 14 per cent – a rate of growth previously seen only in detached homes.

The November sales figures were only slightly lower than fall market peak of the previous month, down 3.3 per cent on October 2015, demonstrating much less of a seasonal slowdown than usual.

November’s home sales were the second-highest on record, second only to the 3,957 sales in November 1989. They were also 46.2 per cent above the 10-year average for the month, prompting the board’s president to comment on the unusually high activity.

“November is typically one of the quietest months of the year in our housing market, but not this year,” said Darcy McLeod, REBGV president.

Sales and Listings

Greater Vancouver home sales rose 40.1 per cent year over year to 3,524 units in November, compared with the 2,516 sales recorded in November 2014. This is a 3.3 per cent decrease compared with the 3,646 sales in October 2015.

Broken down by housing type, detached home sales increased 31.9 per cent year over year. As with October, this substantial increase was the slowest growth rate of the three property types. There were 1,335 single-family home sales in November, compared with the 1,012 sales in November 2014.

Townhomes and other attached properties saw an even bigger annual sales increase in November. The 636 units sold represented a 40.7 per cent increase over the 452 units in November 2014.

Sales of condominium-apartments regained their fastest-growth position, totalling 1,553 in November, an increase of 47.6 per cent compared with November 2014 and once more the highest total unit sales of the three property types. Condos were also the only property type to see sales volumes even higher than October’s, up 0.6 per cent.

What’s Up, What’s Down – At a Glance
	Nov/Oct 2015	Nov 2015/Nov 2014
Overall Sales	-3.3%	+40.1%
– Detached	-7.0%	+31.9%
– Attached	-4.5%	+40.7%
– Apartment	+0.6%	+47.6%
New Listings	-17.8%	+12.5%
Current Listings	-15.4%	-35.0%

 

Despite the high sales volumes, there continues to be a dearth of listings in Metro Vancouver. The number homes for sale on the board’s MLS® at the end of November totalled 8,096, a 35 per cent drop compared with November 2014 and a 15.4 per cent drop from October 2015.

McLeod observed, “The ratio of sales to homes available for sale reached 43.5 per cent in November, which is the highest it’s been in our market in nine years.”

The total number of new listings was 17.8 per cent lower than the previous month, but the 3,392 units listed in November was still a rise of 12.5 per cent compared with the same month the previous year.

McLeod added, “This activity has created favourable market conditions for anyone considering selling their home today.”

November was the ninth consecutive month that the sales-to-active-listings ratio has been above 30 per cent in Metro Vancouver, meaning that the strong sellers’ market conditions continue to strengthen further.

Benchmark Prices

The benchmark price for combined MLS® residential property types in Metro Vancouver once again set a new record, now at $752,500. This is a 17.8 per cent increase compared with November 2014 and a 2.2 per cent rise over the previous record set the month before.

The price of a Metro Vancouver single-family home increased 22.6 per cent from November 2014 to $1,226,300. This was once again the fastest annual price growth of all the home types, further demonstrating the decreasing supply and increasing demand for these homes.

The benchmark price of a townhome or other attached unit increased 11.3 per cent between November 2014 and 2015 to $536,600.

Continuing the surge seen in October, condo-apartment benchmark prices rose at an even faster annual rate at 14 per cent, to $435,000 – once again defying this property type’s usual modest annual rises of 4 or 5 per cent. This growth reflects both an increase in demand from buyers pushed out of the detached home and townhouse market, and the dramatically rising cost of land for new condominium development.

Greater Vancouver MLS Home Sales

Greater Vancouver MLS® Benchmark Prices % Change
	Nov 2015	Oct 2015	Nov 2014
Detached	$1,226,300	+2.4%	+22.6%
Townhome	$536,600	+1.9%	+11.3%
Apartment	$435,000	+2.2%	+14.0%

 

 

Home prices vary widely throughout the REBGV region. To get a good idea of home prices in a specific location, check the detailed MLS® Home Price Index in the REBGV full statistics package.

© 2015 Real Estate Weekly

Critic questions short notice of public feedback session

Naoibh O?Connor
Van. Courier

Cadillac Fairview’s controversial Waterfront Tower is being re-imagined to be more sensitive to the historic Waterfront Station and The Landing heritage building, which flank the site, according to urban design consultant James Cheng of James K.M. Cheng Architects Inc.

Cheng was brought in as a project advisor after an avalanche of criticism derailed the original proposal last January. Cheng helped the design team develop new design principles and guidelines on which the latest scheme is being based.

The tower’s placement on the property, which is located at 555 West Cordova, is being pushed back towards the harbour in the revised plan to create a larger public plaza fronting Cordova Street. This shift also means the facades of Waterfront Station and The Landing will be completely visible, Cheng said.

Whether the design is moving in a direction that satisfies critics, who include prominent planners, remains to be seen. A public meeting is scheduled for Dec. 3 to gather feedback.

The original proposal envisioned a 26-storey, modern glass office “origami” tower that would overhang part of the station.

B+H Architects and Adrian Smith + Gordon Gill Architecture submitted the application on behalf of Cadillac Fairview. Its approval was conditional under existing zoning.

After the Urban Design Panel rejected it in late January, the application’s appearance before the Development Permit Board was cancelled to give time for a re-design.

UDP members raised various concerns including the location of the tower, its proximity to Waterfront Station and that not enough sustainability measures were featured in the project. They also questioned the relationship between the property’s private and public realm.

Cheng said the design team will reveal several massing options on Thursday and that the session is meant to be an open workshop, which will allow participants to offer written input and/or sketch suggestions.

“This is to get feedback. Then [the design team] will go back and finalize their design,” he said. “There are some ideas. It’s not just empty words, so when people come they will be able to see what the design team has done based on the design guidelines — how they responded to the station, how they responded to the cornice line of The Landing.”

Along with being pushed back, the building has been rotated 90 degrees — it was previously oriented in a north-south direction, now it’s oriented in an east-west direction.

Cheng said the public would still be able to go to the back of the site to look at the view and the design team is considering providing an additional viewing plaza in the tower that’s accessible to the public at the level of The Landing’s cornice.

Former city planner Ray Spaxman was among the original proposal’s critics. He questions the short notice for the public feedback session, but he’s hopeful some major concerns have been addressed.

Spaxman is a member of the Downtown Waterfront Working Group, a citizens’ group whose members include former planners and heritage activists. The group wrote to council arguing the plan for the tower jeopardized the future planning of the waterfront.

Spaxman noted the developer wouldn’t meet with the group.

“There is a concern they want to push it through before there are too many changes at city hall that might change the positive attitudes that they met with previously,” he said.

City manager Penny Ballem was fired earlier this year and head planner Brian Jackson retired. Neither position has been filled yet.

Spaxman said he hopes the design team recognizes the importance of the waterfront hub in the new proposal and that the tower’s design has been changed significantly to accommodate the hopes and expectations for the hub and that it’s also sympathetic to the two heritage buildings.

Spaxman maintains if all the property owners in the waterfront hub area cooperated, they could do a better job than if they work individually.

“That’s where we’re looking for leadership from the city as well,” he said.

The public meeting runs from 4:30 to 7:30 p.m. in the Mackenzie Ballroom at the Fairmont Waterfront Hotel at 900 Canada Place Way on Dec. 3.

© 2015 Vancouver Courier