Archive for April, 2020

Don’t cut corners to accommodate hardships

Thursday, April 30th, 2020

A strata council doesn’t have the authority to undo a decision

Tony Gioventu
The Province

Dear Tony:

Our strata council has decided to defer strata fees for several months during the COVID-19 restrictions. Of the seven council members, five are people who are off work for the short term, but the remainder of owners who are retired or work from home have no objection to the continuing of strata fees. Is this possible? If council members have a direct interest in an outcome is that not a time in council meetings when they should remove themselves during the decision making? We are very concerned we will end up in a serious deficit and drain what little reserve funds we have left for an emergency. The council simply advised they will not contribute our allocated contingency amount in the annual budget to make up the difference.

Maria C., Kelowna

Dear Maria:

During these difficult times, everyone is scrambling to make their best efforts in an attempt to accommodate hardships and reduce the day-to-day stresses of financial management. A strata council does not have the authority to undo a decision of the owners at a general meeting. Once the owners have approved the annual budget, the duty of the strata council is to enforce the bylaws and collect strata fees on the first of each month, as approved in the schedule of fees in the annual budget.

While there are no strata police, any owner may simply make an application to the Civil Resolution Tribunal ordering the strata corporation to collect the fees. If a strata corporation wishes to use contingency reserve funds for any purpose other than an emergency, or a recommended depreciation expense approved by majority vote, the strata council must hold a properly convened special general meeting to obtain a three-quarter vote to approve the expense.

An allocated and approved amount to the contingency reserve fund is a payable and budgeted item in the annual budget like every other expense, and it must be accounted for monthly. These designated contingency funds will require the approval of the owners at a special general meeting; however, that type of expense to defer the payment of strata fees may still be subject to a challenge in the tribunal and your strata council should seek legal advice before they consider this option. Many strata corporation insurance policies include some level of legal services for these types of emergencies.

There are three possible methods of convening a special general meeting to approve the possible expense.

The first, permitted by a recent emergency order, is for the strata corporation to convene a special general meeting electronically. A typical 20-day notice must still be issued to the owners, including the agenda and the specific wording of the resolution for the contingency expense, and the strata corporation must establish a method for the voting registration, procedures, and ensure eligible voters are capable to communicate with each other.

The second option would be a conventional special general meeting where a physical meeting is conducted. Because of the assembly restrictions, owners would be required to submit a proxy which could be restricted solely to their instructions and only for the purpose of that resolution.

The third option would be a waiver of notice where each owner is provided the resolution and as condition of waiving notice of a meeting, every eligible voter must vote in favour of the resolution for it to be approved. In smaller strata corporations this is frequently an option where all owners agree.

As council members it is your duty to comply with and enforce the bylaws and the resolutions of the strata corporation. That includes upholding the approved annual budget or any special levies. It is not impossible to make changes or find alternatives when the proper procedures and approvals are applied.

Don’t cut corners and consider the consequences of your decisions.

© 2020 Postmedia Network Inc

The Hillcrest 188 West King Edward 17 stacked townhomes by Vertex Developments

Thursday, April 30th, 2020

Family-friendly townhomes with chef-inspired kitchens at The Hillcrest

Michael Bernard
The Province

The developers of The Hillcrest knew they wanted the kitchens in their 17-unit townhouse complex in central Vancouver to be the most efficient they could build, so they called in award-winning chef David Robertson to review their initial designs.

Robertson, whose Dirty Apron restaurant has been a hit since opening in Vancouver in 2009, has learned a thing or two about what makes a kitchen work well after watching more than 10,000 students pass through his cooking schools.

“I looked at what the Hillcrest designers had there from a practicality point. At one time they had a full (peninsula) so you couldn’t get in and out accessibly.  Then they capped it off with a sideboard at one side and that boxed in things.” He ultimately recommended they go with an island providing easy in-and-out access, a layout they adopted.

“If you have a few more people over then your whole island becomes an ultimate prep station. I am a fan of Wolf and Sub Zero (high-end appliances) but I don’t think that was in the budget. Ultimately, they went with a really good model of Bosch.  These are not massive kitchens but I always say less is more in the kitchen. You don’t need to have things in there that don’t make sense.”

One of the things he particularly liked was a pull-out overhead venting system. “I don’t like microwaves in plain sight in the kitchen either, so I recommended they go with one in the island.”

Kitchens are equipped with a premium Bosch appliance package with a 30-inch integrated fridge, 30-inch five-burner gas cooktop, 30-inch wall oven and a 24-inch integrated dishwasher. The cabinetry is flat panel style and countertops with undermount large single sinks are made of durable quartz lit by under-cabinet lighting.

Robertson, who has written two books on cooking, says he also came up with the concept of planting a communal herb garden in the central courtyard between the two buildings to which only resident families have access.

According to Graham Carter, principal and co-founder of Vertex Developments, bringing in Robertson was a very conscious move to target specific demographic groups in marketing The Hillcrest, the company’s first project. Young families are the company’s prime target group.

“We call (Hillcrest) the Upsizer. We thought of someone with a child in a condo downtown who wants to stay within their social network in the area. We see it as a great opportunity to get into a three-bedroom townhouse.”

That target also explains why Vertex has skewed its space allocation to larger units: of the 17 homes, 15 are three-bedroom units between 1,064 square feet and 1,284 square feet; one is a two-bedroom unit measuring 933 square feet; and one is a one-bedroom home of 579 square feet. The stacked townhouses are located in two buildings constructed around a fully-secured courtyard with fob access for families to enjoy.

Carter, an engineer by training, said he also put himself in the shoes of those in the market he seeks to serve. “We’ve got one (model) which is two level but with the master bedroom on the ground floor and two bedrooms above. So, to me as a dad, I want my kids above me, but I don’t want them below me. It is more comfort and security.”

He said the homes are not “super-sized” in a city area where land prices are high, which means space had to be carefully thought out.  “For instance, cupboards go to the ceiling when others might stop them half way up the wall. We have also gone with nine-foot ceilings in the main areas wherever we could.”

Vertex also thought about the financial needs of young families. “We think a lot of buyers are going to be using the bank of Mom and Pop, which is why we are offering to pay eight per cent interest on the deposit people put down. Mom and Dad might be paying five or six per cent interest on a line of credit on their own house, so by paying them eight per cent interest, it gives them a bit of a buffer.”

Young families aren’t the only ones that Carter wants to draw to the development. Some of the three-bedroom homes are on one level, which should prove attractive to downsizers who don’t want to negotiate stairs as they grow older, he said, “so we think we have covered both ends of the spectrum.”

Carter, who purchased the almost 20,000 square-foot parcel, the former site of two single-family homes, says its location is a very strong feature for both demographic groups. “It is 460 metres to the King Edward SkyTrain station and it is right between the Cambie and Main shopping centres. And the Hillcrest Community Centre and Queen Elizabeth Park are right on the doorstep. It is one of the most accessible sites to downtown and the airport through transit and vehicle.”

Interior flooring is a mix of hardwood oak engineered floors and wool blend carpeting. Large window and recessed pot lights provide both natural and warm light. Modern bathrooms feature a full-height mirror, an elongated pendant light, wall-mounted faucets and water efficient dual flush toilets. Floating vanities have spacious oak veneer storage drawers and under-cabinet lighting and large format porcelain tiles on the floor and ceiling.

Ensuite master bathrooms come with seamless glass showers featuring mosaic tiled basins and Aquabrass rain shower fixtures and handheld wands, heated towel racks and Nu-Heat electric heated flooring throughout. The homes come with combination heating and air conditioning and are built to the demanding standards of a “Low Emissions Green Building.”

The underground garages feature lockers for additional storage, storage for bikes, and roughed in charging systems for electric vehicles.

The Hillcrest was also rolling out a system whereby people interested in seeing suites could view them remotely from the comfort of their own home and be able to ask questions of sales staff at the same time as they view the suites.

The Hillcrest, Vancouver

Project address: West King Edward Avenue and Columbia Street

Project scale: 17 stacked one, two and three-bedroom woodframe townhomes in two buildings separated by a common courtyard. Homes range from 578 sq. ft. to 1,284 sq. ft.  Ground-level homes have ample patio space while stacked townhomes have raised entries and private rooftop decks.  Centrally located, close to Canada Line, Queen Elizabeth Park, and shopping on Cambie and Main streets

Prices: Three-bedroom townhomes from $1,479,900

Developer: Vertex Developments

Architect: Formwerks

Interior Design: Area3 Design Studio

Sales centre:  Suite 301 – 1508 West Broadway, Vancouver

Centre hours:  By appointment only

Sales phone: 604-394-2088

Website: https://

Completion date: Summer 2021

© 2020 Postmedia Network Inc.

More Listings Now Showing Price History on

Thursday, April 30th, 2020

Sold data now available on CREA


On April 15, the Kamloops and District Real Estate Association (KADREA) and the Kootenay Association of REALTORS® (KAR) became the first real estate boards in British Columbia to display historical sold prices on

Consumers, boards and members have been asking to see historical sold data on for some time. Having sold data helps CREA ensure it continues to offer leading-edge services on, especially as competing real estate portals attempt to gain traction with Canadian consumers.

“KADREA and KAR continue to ensure REALTORS® are equipped to match the needs and wants of their consumers,” said KADREA President Wendy Runge. KAR President Tyler Hancock echoed the sentiment, “This is another example of incredible Board collaboration and empowering the consumer.”

Currently, eight boards and associations have cleared regulatory hurdles and are displaying sold data on The Nova Scotia Association of REALTORS® (NSAR) became the first to do so in January of 2019, followed closely by New Brunswick.


How to Use Video to Stay Connected With Your Clients

Thursday, April 30th, 2020

Real estate video tips for COVID-19 and beyond

Justin Kerby

COVID-19 has made it impossible to stay in touch with clients in person, but there are many ways to keep your relationships strong during these uncertain times. One widely available tool you can use to stay connected with your clients is video, which can be used in numerous ways and on multiple platforms.

Here are six ways you can use video to stay connected with your clients. They’re great for the coronavirus pandemic, and will still be useful long after things get back to normal.


1. Conduct Expert Interviews

Your clients have a lot of questions right now, many of which are directly related to real estate and its adjacent industries.

If you’ve been in the industry for more than a year, you’ve likely built some great connections with mortgage brokers, notaries, home inspectors, and other professional service providers. Consider partnering with a local expert (who preferably has their own social media following) and conduct an interview with them on their area of expertise. Come prepared with questions surrounding the current market conditions and the near and long term outlook.

Be sure that your guest shares the interview on their social media accounts and ask them to tag your business pages in any post. This is a great way to reach a new audience.

There are many platforms you can use to conduct an interview, with Zoom being one of the most popular options available. You can also use a live video feature from Facebook, YouTube, or Instagram – we’ll talk more about that below.

Example Idea: Ask your favourite local mortgage broker to join you on a Zoom call to discuss the news that the six big banks have delayed mortgage payments. Ask them how to inquire about the new programs, who’s eligible, and what other policy changes homeowners can expect in the near future.


2. Try a Live Video

Live videos may seem daunting, but don’t let them scare you away. Once you get the hang of it, you’ll be able to communicate with your clients quickly and effectively. Unlike other video production, there’s no editing, no obsessing over a script, and no searching for the perfect shot. All you need to do is get comfortable with your on-camera skills and you’ll have an easy way to reach your audience.

There are a ton of platforms that offer live video publishing and each has its own features, but Facebook Live is a good place to start. Facebook Live videos tend to jump the algorithm and reach a large portion of your audience, as your page followers will be notified you’re live. You can even set an air date for your video and have people schedule a reminder to watch.

Practice going live on your Facebook page by limiting your audience to just yourself until you get the hang of it. Then, when you’re ready, be sure to share the video with any of your personal or business pages the moment you go live.

As we discussed above, you can bring in and conduct an interview with another person on Facebook live. Once your expert interviewee starts watching your live video, you can invite them to chat and conduct a split screen interview. Again, test this out with your guest as the only audience before you go live, just to make sure you work out the kinks.

Example Idea: While many of us are stuck inside, interior design has become increasingly on the minds of homeowners. Set up a live video with a local interior designer and have them run through a few tips for maximizing space or setting up the perfect home office. REW is also working on ways to connect agents to clients via live-streamed open houses – watch this space for more information soon.


3. Market Updates

Market updates are commonly used in newsletters and blogs, but they’re not often covered in videos. We’re not saying you have to switch to only using video for your market updates, but at the very least you should transform your blogs and newsletter posts into video content that can be shared across your social media platforms.=

We’ve seen some amazing examples of market updates in video form. Most local news coverage right now focuses solely on the COVID-19 pandemic (as it should), but this is leaving a gap for real estate agents to fill with video content. People still want to know what’s happening to the market, and market update videos are a great way for you to provide that data to your clients. Make a 5-minute market update video every month to start and go from there if you see strong engagement numbers.

If you have a market update newsletter, try including your video in the newsletter and give people the option of consuming your information in video format. You’ll be surprised how many of your clients prefer video.

Example Idea: Get a whiteboard, write down the important statistics and data for your local community, and run your clients through the biggest percentage changes and the implications of those changes and other factors on the market.


4. Local Spotlights

Getting involved in your area’s business community is a great way to build a local presence and become the go-to realtor in your community. Showing off your favourite places, whether they be restaurants, boxing gyms, or coffee shops, is a great way to reach a larger audience and provide educational content to your clients. Always be sure to let the local businesses know that you’re mentioning them either by phoning, emailing, messaging or tagging them on social media, and reserve your local spotlight for businesses you love. You’ll get the best engagement if your recommendations are heartfelt and sincere.

The COVID-19 pandemic has had serious effects on the real estate industry, and while you may not be able to go into a restaurant to conduct an interview or get photos and videos of their operation, it’s still possible to hand out video recommendations and spotlights from your living room.

Example Idea: Record a video highlighting your three favourite restaurants in the local community, provide your followers with the restaurant’s contact information for takeout, and notify the businesses of your recommendation.


5. Q&A Sessions

Wouldn’t it be great to know what questions your clients have about the real estate market? Good news: There’s an app for that.

Instagram’s “Question” feature is a fantastic way to get a roundup of questions from your followers. If you post the Question sticker on an Instagram story, your followers will be able to submit questions that you can answer within your stories at a later time. You’ll be able to see who asked what, but to your followers it will be anonymous.

Here’s how we recommend conducting a Q&A session on Instagram:

Post an Instagram Story video early in the morning explaining that you’re going to be answering questions about the real estate market, your business, and anything in between. Remember that it’s completely up to you which questions you choose to answer. Ask people to submit their questions on the next Story, and then post the question sticker on the next Story with the caption “Ask Me Anything.”

Either that evening or the following morning, answer the questions you received in an Instagram Story (be sure to take videos). People who asked questions will watch to see their answer, along with a good portion of your following who is interested in what’s going on in the market. This is a great opportunity to connect with your clients when you can’t visit them in person.

Example Idea: At 7am, post to your Instagram Story and ask people what questions they have about COVID-19’s impact on the real estate market in your city. Tell them you’ll answer their questions anonymously and to check back on your Story for answers at 7pm.


6. Offer Virtual Tours

While open houses and private viewings may be impossible at the moment, virtual tours are filling in the gaps and making it easy for sellers to show off their properties. On top of that, they make the home search experience more enjoyable, giving buyers a much more in-depth look at listings.

© 2020 REW.

Scotiabank preparing for widespread post-pandemic changes

Thursday, April 30th, 2020

Bank of Nova Scotia will have a ?new normal?

Ephraim Vecina
Mortgage Broker News

The Bank of Nova Scotia is not expecting a return to the “old normal” once the global coronavirus outbreak subsides.

Scotiabank said that the resumption of its operations will depend largely on how Canada fares after the crisis.

“Re-entry plans will differ by geography and will be completely dependent on the status of COVID-19 in those areas,” said Scotiabank chief human resources officer Barb Mason. “The bank, as well as local governments, will be considering multiple factors when it comes to the possibility of re-entry, from urban markets to rural markets, density of population where offices are located, and more.”

“Our ‘new normal’ is unlikely to be us resuming our ‘old normal’ in terms of how and where we work,” Mason told BNN Bloomberg. “You can be confident that we are taking everything into consideration – this is a complicated situation.”

Earlier this month, the Bank of Canada announced that it will keep the overnight rate at 0.25%, which it called its “effective lower bound.”

This came after an extraordinary series of adjustments that saw the central bank lower its target for the overnight rate three times in March. The Big Six banks also slashed their prime lending rates significantly by the end of that month.

“For its part, the Bank of Canada has taken measures to improve market function so that monetary policy actions have their intended effect on the economy,” the BoC said in mid-April. “This helps ensure that households and businesses continue to have access to the credit they need to bridge this difficult time, and that lower interest rates find their way to ultimate borrowers.”

Copyright © 2020 Key Media

Manufacturers swivel to arm front-line workers

Thursday, April 30th, 2020

At least a dozen Surrey firms now making masks, shields and sanitizer for virus battle

Frank O’Brien
Western Investor

At least a dozen Surrey manufacturers, including a brewery, have retooled to produce essential medical and personal protective equipment (PPE) during the pandemic.

The companies have the capacity of producing up to 32,000 face shields, 40,000 reusable fabric face masks and upwards of 200,000 litres of hand sanitizer each month, according to a city statement. 

As of April 30, 11 companies had signed on but another 11 were in the process of retooling, said Amber Stowe of Surrey’s communication department.

The companies have all signed up for a new program Surrey Makes PPE, a City of Surrey initiative to assist senior levels of government and health authorities access large quantities of PPE supplies.

“Surrey is home to one of the largest manufacturing bases in the province and I want to commend our businesses for pivoting so quickly to produce critical medical and protective supplies needed to fight COVID-19,” said Mayor Doug McCallum. 

Surrey Makes PPE was launched to assist senior levels of government and health authorities access large quantities of PPE supplies. An additional nine facilities are in the process of retooling their assembly lines in response. 

The program also provides an online marketplace that allows buyers to source in bulk from manufacturers, such as Central City Brewer, which is now turning out hand sanitizers. 

Surrey’s Firetech Manufacturing repurposed their production lines to produce face shields. 

“Firetech Manufacturing’s core business is building custom bags and backpacks for first-responders,” said Dan London, president of Firetech. “When the federal government sounded the call for PPE, we naturally decided to pivot part of our production to build disposable face shields, for most of which is being purchased by the local health authorities.”

Copyright © Western Investor

House prices will fall 10% before recovery: Moody’s

Thursday, April 30th, 2020

Western markets will take worst hit, but some analysts see a rebound as early as June

Frank O’Brien
Western Investor

Housing sales, prices and starts across Canada will plunge this year and stay muted for at least a year, with Western provinces taking the worst hit, according to Moody’s Analytics.

Other analysts, however see a more brief, shallow downturn that could reverse as early as June.

“The COVID-19 pandemic along with the collapse in oil prices will create a perfect storm this year for both home sales and residential construction,” according to Abhilasha Singh, an economist at Moody’s Analytics who authored the Canada Housing Outlook, released April 30.

The negative effect will be felt acutely in the West because of its economic makeup, the report states.

“British Columbia is most exposed in terms of leisure/hospitality and trade, while the Prairie provinces—which were already dealing with softening demand for energy—are most vulnerable to the collapse in oil prices,” Singh said.

Moody’s is forecasting a national contraction of the baseline GDP by 15 per cent in the second quarter of 2020, compared to year earlier, while the unemployment rate will nearly doubles] to 10 per cent. This will cause housing starts to fall to 145,000 annualized units by the end of 2020, compared with 210,000 in early 2020. 

While the report highlights the “extraordinary measures” taken to lower lending costs, including slashing the Bank of Canada interest rate to 0.25 per cent in March and a subsequent reduction in the five-year mortgage to below 3 per cent, it warns home buyers, worried about job losses, will remain sidelined.

“Not even lower interest rates will be enough to save the housing market,” Singh said.

As a result, Moody’s Analytics expects Canadian home prices to suffer a peak-to-trough decline of about 10 per cent.

 “As the outlook begins to improve in early 2021, house prices are expected to rebound,” the report notes.

Nationally, the composite house price index is forecast to decline 2.7 per cent this year and 3.6 per cent in 2021, but increase in 2022. 

In comparison, home prices in Metro Vancouver are forecast to drop 4.2 per cent this year and a further 6 per cent next year and continue to decline by 2 per cent in 2022 before a tepid recovery three years from now.  

Calgary, which saw housing sales plunge 63 per cent by mid-April compared to a year earlier, according to the Calgary Real Estate Board and RBC Economics, could suffer the worst house price decline in Canada. 

Moody’s forecasts Calgary home prices falling 8.3 per cent this year and 8.8 per cent in 2021, though it projects a potential double-digit price increase by 2023.

RBC Economics and the Canadian Real Estate Association (CREA) forecast a more shallow and shorter downturn in the housing market due to COVID-19 and its trailing economy malaise. 

CREA expects to see housing sales returning to a strong pace in 2021.

 “This will be a temporary shock,” agreed Robert Hogue, of the macroeconomic and regional analysis group with RBC Economics, who says the recovery could start as early as mid-2020.

“We expect stronger  activity to  resume once  social distancing  orders are relaxed. Our baseline assumption is sometime in June. Exceptionally low interest rates will  help spur the  recovery,” Hogue said. 

“Our current view is the recovery will stretch into 2021 in most markets,” he added. “Odds of a major price drop are still low.” 

The exception to this rosy scenario is the Prairies, Hogue warns. 

“ The plunge  in crude  oil  prices  are poised to further drive [Prairie home] prices lower,” he said.


Copyright © Western Investor

COVID-19 brings Canada’s commercial mortgage market to a halt

Thursday, April 30th, 2020

Commercial mortgages flattened with bank withdrawal of loans

Ephraim Vecina
Mortgage Broker News

The Canadian commercial mortgage market’s enviable run of stability has hit a wall with the advent of the coronavirus pandemic, according to a recent report by CMLS Financial.

“After two quarters of nearly flat commercial mortgage spreads, March saw the largest shift in over a decade,” CMLS said. “Market liquidity quickly deteriorated as lenders assessed the uncertainty around borrowers’ ability to service debt and the government’s response to COVID-19. Several institutions paused lending activity entirely until a sense of normalcy returns to markets.”

Market uncertainty and dwindling capital supply have also “quickly reflected upward pressure on commercial mortgage spreads,” CMLS said. “Several key fixed income indexes, often leading indicators for the commercial mortgage space, had their spreads widen substantially at the end of Q1.”

However, other observers have said that a stronger post-coronavirus commercial market is not as far off as the severity of the current crisis would suggest.

“With internal operational issues consuming 100% of many firms’ time, new investment decisions have become secondary for the time being,” CBRE said in its recent report. “Term, covenant and existing financing have become increasingly important across asset classes. These factors will continue to enhance or eliminate liquidity for firms moving forward.”

CBRE said that this will be particularly apparent in Toronto, which accounted for the lion’s share of the Canadian commercial sector’s strength prior to the global outbreak.

“With risk-free interest rates approaching zero, the real estate sector is poised to be an even more attractive investment option once the markets begin to normalize,” CBRE said.

Copyright © 2020 Key Media

Thinking about deferring your mortgage?

Wednesday, April 29th, 2020

Impact of mortgage deferring needs consideration

David Kitai
Canadian Real Estate Wealth

News that Canadian financial institutions were offering some mortgage deferrals sent investors running to the banks in early April, asking for a stay on their payments as personal incomes and investment portfolios were being wiped out by the coronavirus pandemic. Those deferrals seem like a lifeline for investors facing a liquidity crisis, but one leading mortgage broker thinks the impacts of a deferral need to be considered closely.

Dalia Barsoum, president and principal broker at Streetwise Mortgages, says that investors should consider alternatives to mortgage deferrals. She explained that these deferrals aren’t gifts or grants, as they come with a cost, a likely increase to future payments, an impact on future financing availability and a wider implication for an investor’s credit. Barsoum says despite the pain investors are feeling, they shouldn’t just take mortgage deferment as their first line of support.

“We look at mortgage deferrals as a last resort tool for investors to utilize to help ease financial destress,” Barsoum says.

Barsoum outlined what some of those sources of financial distress are. The primary pressure on real estate investors stems from unemployment, both the loss of their own job or, if they own a rental property, the loss of a tenant’s income. The temporary collapse of Airbnb, too, has resulted in an increase to rental stock in some Canadian markets, putting downward pressure on rents. Further, softening property valuations in some markets, have made it more challenging to extract equity when it is needed most. Even committed deals, not yet closed, might be torpedoed by a borrower’s inability to get a mortgage. The financial pressures on a real estate investor are widespread, perhaps enough to make mortgage deferral seem like the right option. Barsoum says investors need to look at the long-term implications of that short-term fix.

Her first concern is cost, explaining that interest will accrue on the deferred amount for the duration of the period. Each lender, too, applies its only methodology of repayment for the accrued amount after the deferral period. Investors need to know what that post-deferral arrangement will look like before they sign off on anything.

That methodology could also result in an increase to future monthly payments. That increase will vary based on the mortgage size, interest, and duration of the deferral. An increase in the debt load will, as well, likely impact an investor’s ability to qualify for future financing, especially if their new  payments are higher across several properties within the portfolio.

Though a deferral is different from a default, and should not have any negative impact on credit, that requires an adjustment to lenders’ systems allowing them to report deferrals in the right way. Barsoum thinks that the sheer volume of deferral requests has increased the risk of reporting errors.

“If you are considering a deferral and can wait on it another month, then please do so to allow time for the first round of deferrals to go through the systems and see how that turns out,” Barsoum says. “Further, if you have chosen to defer by now, then please monitor your credit report for the next 3 months.”

Current financing arrangements, too, could prove challenging to obtain for investors with an active deferred payment. The logic, as Barsoum sees it, is that in taking a deferment an investor has told the lender whether they “can or can’t” afford the payment. In such a binary situation, taking the deferment puts you in the “can’t pay” camp, which carried long-term implications.

“My suggestion is to first examine your finances, challenges and plans with your current mortgage advisor,” Barsoum says. “Come up with an action plan before jumping on mortgage deferrals as the first line of support because of panic, fear of the unknown, or fear of missing out on this support tool.”

Copyright © 2020 Key Media Pty Ltd

Reduced purchasing power more apparent in Canada’s largest markets

Wednesday, April 29th, 2020

Unemployment biggest impact on housing market

Ephraim Vecina
Canadian Real Estate Wealth

Unemployment has a disproportionate impact on the country’s largest housing markets, according to new Statistics Canada figures.

Across Canada, the employment sector declined by 5.3% from February to March, representing more than 1 million lost jobs. The unemployment rate rose to 7.8%, spurred by a record high 2.2% monthly increase.

Of particular concern is the sharp drop in employment in the private sector (down 6.7%), which was at a rate nearly double that of the public sector (down 3.7%).

“Unemployment increased by 413,000 (+36.4%), largely due to temporary layoffs,” Statistics Canada said. “In addition, the number of Canadians who had worked recently and wanted to work, but did not meet the official definition of unemployed, increased by 193,000.”

The agency’s March figures also indicated that unemployment rates in Toronto, Vancouver, and Montreal have experienced rapid increases last month.

The trend is compounding the already severe socio-economic effects of the COVID-19 pandemic, according to real estate information portal Better Dwelling.

Toronto’s unemployment rate stood at 7.8% as of March, having grown 11.42% annually. Meanwhile, Vancouver saw its share of unemployed workers shoot up by 68.89% year-over-year to reach 7.6% – a sharp about-face from the numbers traditionally associated with the city’s robust labour sector.

Of the top housing markets, Montreal suffered the highest unemployment rate last month, increasing by 51.67% annually to end up at 9.1%.

Copyright © 2020 Key Media Pty Ltd