Will the next iteration of COVID-19 assistance keep Canadians in their homes?

Clayton Jarvis
Mortgage Broker News

Three hundred and forty-three billion dollars. It’s not often you hear numbers like that associated with Canada. Even the country’s largest infrastructure project, the LNG colossus going up in Kitimat, B.C., is estimated to come in at $40 billion, and that’s over a years-long timeline. But that $343 billion is all ours: It’s now the estimated budget deficit for the Canadian government for 2020 alone, and that’s not even counting the deficits being run at the provincial or municipal levels.

Propping up an economy while a pandemic tries to pull it down sector by sector is expensive work, particularly for a country with a tax base as small as Canada’s. But the heavy lifting isn’t over yet. Millions of Canadians are still out of work, tens of thousands of small businesses are expected to close, and a “devastating” second wave of COVID-19 infections is still very much in the cards for the fall, which, in case you haven’t looked at a calendar in a while, is only weeks away.

The government will inevitably need to keep spending, but without knowing the future, deciding how much aid Canadians still require, and what the feds can afford to keep doling out, is a complicated guessing game.

 

What’s up with CERB?

The Canada Emergency Response Benefit has been sending $2,000 a month to Canadians since the application process began on April 6. Originally scheduled to last sixteen weeks, CERB was extended for another two months at the beginning of July. That means anyone who started receiving CERB funds in April will see their benefits dry up in September.

As of July 26, over 8.4 million Canadians had applied for CERB, resulting in government cheques totalling almost $63 billion.

CERB has been controversial, to say the least. Some describe it as a “lifeline” responsible for keeping millions of Canadians housed and fed, others point to the rampant abuse of the program by recipients who experienced no job disruption. As provincial economies opened up in June and July, some critics felt the amount of money being sent to CERB recipients was disincentivizing them from returning to work. National Bank of Canada found that in some industries CERB replaced more than 80 percent of the average worker’s lost income. It increased the average income of accommodation and food service workers by 19 percent.

“That is a tremendous disincentive,” says Michael Gregory, managing director and deputy chief economist at BMO.“There are a lot of anecdotes of businesses starting up and having a hard time finding the labour they need.”

But Gregory insists that turning off the taps isn’t an option.

“Cold turkey? No. Having had the economy on this life support – ‘liquidity support’ is a better term – just to cut it off immediately would not be an appropriate response,” he says.

RateSpy founder Robert McLister says Canada isn’t even close to being in a position to cut CERB completely.

“Canada is still down almost 2 million jobs, has over a half-million more on permanent layoff and not seeking work, has millions more with reduced hours or earnings, and has one of the highest unemployment rates in the G20,” he says.“Fiscal support is Canada’s respirator. You don’t want to pull the plug until the country’s breathing on its own.

 

What about CEWS?

The extension of the Canada Emergency Wage Subsidy provides more of a clue as to which basket the government may be shifting its eggs into. The program, which covers up to 75 percent of employee wages for eligible businesses, has been extended twice, first until August 29 and again until December.

The extension means CEWS is locked in far longer than CERB, signaling the government’s intent to both get Canadians back to work and Conservative critics off its back.

“It’s going to be critical for the economy, one way or the other, that we transition Canadians off the (income support) and onto the wage subsidy,” RCB economist Colin Guldimann told Reuters.

But if businesses continue faltering throughout the summer, or a second wave of COVID-19 flares up in the fall and causes more of them to close, their workers may not have wages left to subsidize.

 

The new scenario – EI

On July 31, the Trudeau government announced it would be transitioning CERB recipients to the federal employment insurance program in September. Details were scant, but Trudeau insisted  

“EI should cover every Canadian who is looking for work, and for those who don’t qualify for EI right now, like gig or contract workers, we will create a transitional, parallel benefit that is similar to Employment Insurance,” the Prime Minister said.

Under the new EI plan, recipients will be allowed to earn money while receiving benefits. The updated system will reportedly make allowances to broaden eligibility and relax the number of work hours needed to qualify.

According to Gregory, this was the government’s best remaining option.

“Right away, you take it from being an emergency response to being a part of the normal response with a little more latitude or flexibility, which could be cheaper for the government anyway,” he says.

It may be cheaper than CERB, but an expanded EI program means the government will still be on the hook for billions and billions of dollars if Canadians cannot return to their jobs. That can’t go on forever. The U.S. allowed its $600-a-week expanded unemployment insurance program to expire on July 31, with no alternative proposed, despite the country’s inability to get COVID-19 under control and get Americans back to work.

McLister, though, doesn’t think Canada will have the option of ending financial assistance until the COVID-shaped crater in the job market fills itself back in.

“Fiscal prudence is out the window,” McLister says,“and our leaders are too invested to pull out early. They’ll happily keep spending taxpayer money until most, or all, jobs come back.”

 

 

Copyright © 2020 Key Media

Juniper West: A master-planned community in Kamloops

Michael Bernard
The Province

While COVID-19 has caused many real estate markets in British Columbia to drop like a yo-yo, there is one Interior city where home prices have held steady this year.

The city of Kamloops, a long-established centre for forestry, mining, healthcare and tourism, has experienced consistent growth over the last five years. That is a comforting fact for Doug MacKenzie, whose company’s sprawling 250-acre master-planned community, on the quiet outskirts of this city of 100,000 located four hours by car northeast of Vancouver.

Juniper West’s masterplan—adopted by the city in 2007—calls for a total of 675 multi-family units and single-family homes with panoramic views of the Thompson River Valley. So far, about 476 homes and homesites have been developed by Juniper West and its construction arm, Juniper Builders, said MacKenzie, Juniper West’s general manager.

“It’s a fairly steady real estate market. We are starting to see a lot of growth with families moving to our community from the Lower Mainland and a lot of local families and families from Alberta. There is still a lot of good value relative to other areas of the province.”

A quick comparison with Kelowna to the south confirms what MacKenzie says. B.C. Real Estate Association statistics for May show that the median detached house price in Kamloops is $562,500, well below the $672,000 detached home median price for Kelowna and its surrounding zone. The gap is even greater when compared to Metro Vancouver, where average detached home prices exceed $1 million. Median townhome prices show similar differences between Kamloops and Kelowna for May: $314,500 versus $495,500.

At Juniper West, first-time buyers can get into the real estate game with a 1,700 square feet three-level townhouse in Juniper’s 50-unit Ridge development for just under $400,000. A single-family home, ranging between 2,500 and 3,000 square feet and with complete landscaping, can be bought for $668,000 and up.

What draws people to Kamloops is the semi-arid climate, relatively mild winters and its healthy focus on both winter and summer sports. Within walking distance of Juniper West, for instance, is the Kamloops bike ranch, a popular site for recreational and competition biking. Sun Peaks, considered one of the province’s leading ski mountains, is just a 50-minute drive away. Kamloops itself has several stable employers, including Interior Health and the 250-bed Royal Inland Hospital together, have 1,400 employees, Highland Valley Copper (1,300), the school district (2,200) and Thompson Rivers University (1,100).

The Ridge, a 50-unit development, a collection of three-level townhomes, is configured in eightplexes. The modern design homes feature bright open floor plans with custom millwork throughout.

There are two kitchen cabinet styles to choose from with quartz countertops. An optional kitchen upgrade includes all stainless-steel appliances, including a hookup for a natural gas range. There is a 48-inch electric range fireplace in the living room, complemented with a two-stage high-efficiency gas furnace and air conditioning. Flooring includes high-end laminate flooring throughout the main living areas.

Outside, the homes are sheathed in Hardie board-and-batten siding with a brick masonry veneer and aluminum railings enclosing 300-square-feet of outdoor living space. Each home has a garage for a single vehicle, plus an outside parking space and a visitor space. There are also outdoor gas BBQ hookups.

Juniper Builders is currently offering Qu’Appelle Boulevard, a collection of 20 single-family homes available in four different designs, with and without basements. The homes also allow for legal suites that can serve as mortgage helpers. The homes range in size from 1,325 to 1,950 square feet not including basement space.

Mark and Taylor Paynter have just purchased in The Ridge. “We were renting in Aberdeen, a neighbourhood on the western tip of Kamloops,” said Mark. “We’ve been here for four years now, and we have quite a few friends who live up in the Juniper area. We know that it is a very family-friendly and active community, and it’s safe, warm and welcoming.”

Mark, a law enforcement officer, and Taylor, a teacher, are originally from Prince Edward Island and came out a few years ago for a fresh start. They were attracted to Juniper West because there are lots of young people within a few years of their age. Taylor said she had a contract at the local elementary school and loved it. “There are great kids and great families there, and it really contributed to our decision to buy there.”

Chris and Bre Crowell, who have a two-and-a-half-year-old boy and a one-month-old girl, moved into a five-bedroom, three-bathroom single-family home in Juniper West. “We owned a duplex in another neighbourhood,” said Chris, who is a civil engineer. “We wanted our own yard and not to be sharing a common area with our neighbour. We also decided we wanted something newer, and we didn’t want to deal with the headaches and the expense of an older place.”

The community was a big attraction for them, said Bre. “It has a good community feel. It has a convenience store, lots of parks and lots of young families.”

Juniper West, Kamloops

Project address: #103-2049 Highland Drive, Kamloops

Project Scale: A total of 675 multi-family and single-family homes and building lots in a 250-acre master-planned community with panoramic views overlooking the Thompson River Valley in Kamloops, located 250 kilometres northeast of Metro Vancouver. Located eight minutes to downtown Kamloops, the subdivision includes an elementary school and daycare, grocery store plus parks and green spaces.

Prices: From $225,000 for fully serviced single-family lots; from $398,800 for 1,700 sq. ft., three-bedroom townhomes, and $668,000 for single-family homes starting at 2500 sq ft. with options for fully legal rental suites.

Developer: Juniper West Development Ltd. /Juniper West Builders Ltd.

Architect: Various, including Richard Hunter, Architect and Bergman Home Designs.

Sales Centre: #103-2049 Highland Dr., Kamloops

Centre Hours: Monday to Friday 8 a.m. to 4:30 p.m. and by appointment on weekends.

Sales phone: 778-471-2981

Sales contact: Doug MacKenzie, General Manager

Website: JuniperWest.com

Completion date: Continuous completion

© 2020 Postmedia Network Inc.

Real estate sales in the age of COVID-19

Toby Welch
REM

COVID-19 was like a bomb to the Canadian real estate industry, forever changing the way real estate is done. Markets were severely impacted and protocols were revamped overnight. The ins and out of real estate transactions are still morphing on a day-to-day basis. We spoke to some sales reps across the country to see what changes may become permanent.

 

Heather Hadden

Heather Hadden, a sales representative and team leader at Hadden Homes, Chestnut Park Real Estate in Toronto, says, “We do a lot more online. I find with buyers the search is more deliberate. If there is interest in a property, we are going to see if the interest is real – no more going out to get a feel of a property or the market. The buyers that are looking today are more serious and pre-qualified than I have ever seen. Also, there is the social distancing part, wearing masks at showings, not getting too close. We also have to plan showings farther in advance due to forms being filled out and no double bookings.”

Virtual open houses have skyrocketed since March, as have virtual tours with agents. Screen-to-screen selling is much more commonplace than pre-COVID-19. With virtual personal tours, a time and date are set and the agent walks through a home while potential buyers watch on a screen of some sort. If they want to see the view out of a window or get an up-close look at the wallpaper, that can happen. It’s a powerful sales tool and the next best thing to viewing a home in person while keeping everyone safe.

 

Glenn Wildenmann

Glenn Wildenmann, a real estate broker with M Immobilier real estate agency in Pointe Claire, Que., shares his experiences working amidst the pandemic: “Hand sanitizer… oh, so much sanitizer. Technology has been very helpful with Zoom and E-signature of course, but my business is very face-to-face and relationship based. It can be challenging to have that connection with masks and gloves and distancing; it’s an adjustment and we’re all still finding our way. One of my favourite things is accompanying my clients to the notary for closings; it’s a chance to congratulate and celebrate with them. I have not been allowed to attend any of my recent signings due to COVID-19 (only buyers and sellers), so it feels incomplete not having that closure.”

 

 

Randy Book

Randy Book is the manager of business development for Sutton Group West Coast Realty in Vancouver. Like so many others, he was forced to use technology more as the pandemic took hold.

“I use Zoom for collaboration. It has been a great tool. I’m able to reach more of our agents. It was easy to learn… and still learning. I recommend that you practice using the app before jumping in. Zoom buyer and seller presentations are not ‘out of the box’ thinking. There is a ‘new box’ to work in.”

With so much of real estate taking place online these days, agents are upping their online presence. Listings are more detailed and visually appealing than ever before. Video and drone tours are becoming the norm. Social media has become even more of a necessity. As a whole, the priority of having a top-notch online entity has never been greater.

During the pandemic, Wildenmann’s business has been both hot and cold. “Some clients have put their plans on hold until they get a better sense of things with respect to COVID and the accelerated market. It’s important to guide them to find a comfort zone and to go at their own pace. I’ve also had two buyers who unfortunately lost jobs and no longer qualify to purchase. Meanwhile, other clients are buying and selling as fast as they can; they are seeing the frenzy and jumping right in.”

On a positive note, many in the industry are seeing an upswing in the markets. Hadden hasn’t seen things as busy as they currently are since the beginning of 2017.

“That being said, some things are selling a lot faster than others. Houses are seeing multiple offers consistently; condos downtown are slower to move. In May it started to get better and then in June and July we have been the busiest we have ever been.”

Book has a similar experience with leads starting to feel more confident about moving ahead in June and into July. “Consumer engagement is back.”

Are we at a point where things are starting to return to “normal”? Wildenmann figures that there is no normal anymore.

“COVID precautions aside, the market itself is back and even more active than pre-COVID days. The pent-up demand coupled with low mortgage rates is causing almost everything to have multiple offers and to go over asking,” he says. “An interesting source of the hyped activity has been from downtown condo owners. Working from home during the lockdown has caused many to realize this may be the way of the future. Quickly, 500 square feet of living space isn’t going to cut it, especially with the condo gyms, pools and common rooms closed during the shutdown. We are seeing this sudden desire (demonstrated by sales) to exit the city for the burbs and beyond. People now see the benefit of more indoor and outdoor living space while providing easier physical distancing. Wish lists include space for that home office, basement gym and a backyard to enjoy a relaxing deck and maybe even a pool.”

Book uses the word “remarkable” to describe his business since the pandemic hit. “It’s not been at all what I had expected. I really thought the Greater Vancouver market was going to get hammered good and come off at least 20 per cent or so. I was dead wrong. Sales are moving along nicely over the last two months after an initial stall for April-May, which is understandable. You know, no one really knows for certain what is going to happen.”

Even with the global pandemic still our reality, buyers need to buy and sellers need to sell; that fact is always a plus for agents and brokers.

 

© 1989-2020 REM Real Estate Magazine

A case of the haves and the have-nots’: Vancouver home sales and prices jump in July

Jessy Bains
other

The COVID-19 pandemic hasn’t pushed Metro Vancouver home buyers to the sidelines the way many expected, at least not yet.

Instead, the latest data from the Real Estate Board of Greater Vancouver (REBGV) show 3,128 homes were sold in July, a 22.3 per cent increase from the 2,557 sold during the same month last year. Sales were 28 per cent higher than last month, when 2,443 homes changed hands.

Sales were 9.4 per cent above the 10-year July average.

“We’re seeing the results today of pent up activity, from both home buyers and sellers, that had been accumulating in our market throughout the year,” said Colette Gerber, REBGV chair, in a release. 

“Low interest rates and limited overall supply are also increasing competition across our market.”

The benchmark price for all types of homes is $1,031,400, 4.5 per cent higher than July 2019 and 0.5 per cent higher than last month.

The surge in activity is taking place against the backdrop of a job market with millions still out of work, and an economy with a long way to go before getting back to where it was before the pandemic.

“It boils down to a case of the haves and the have-nots, if you have money during this pandemic, and still have steady employment, you view it as an opportunity to buy, and that’s exactly what is happening,” David Hutchinson, Sutton Group West Coast Realty realtor, told Yahoo Finance Canada.

“I am not expecting this trend to continue, this pent-up demand will recede, and listings will accumulate.”

 

Like Toronto, the transition to working from home is helping to lead to a shift out of condos. 

“Some condos in good locations that are still well-priced seem to be struggling, while detached is definitely the hot market–the opposite was true not too long ago, oh how the market shifts,” said Hutchinson.

“Nevertheless, I do get more inquiries into the outlying suburbs’ market — even out to Mission and Naramata — where one can get some acreage and space between the neighbours, and still put some equity in the bank for a rainy day.”

There were 12,083 homes for sale through the MLS system, 15.1 per cent fewer than the same month last year (14,240) but 5.8 per cent more than last month (11,424).

 

© 2020 Yahoo Finance Canada

Reader recommends national condominium insurance program

The Province
The Province

Vancouver city council’s differing views on rental housing were on display at a recent meeting: Five members felt council should be acting as quickly as possible to get more rental homes built, some thought we may need more but it wasn’t worth rushing and one questioned the need to boost rental construction at all.

Council was considering zoning amendments that would, basically, make it easier for developers to build six-storey, mixed use developments along many commercial streets — two floors more than the four already allowed there — if the residential portion of the building is rental instead of market condos.

For many years, the vast majority of these developments along those arterials have been market condos, which are more profitable for developers. The changes coming to council for a decision last month were an attempt by the city to tilt the balance toward rentals, trying to improve Vancouver’s chronically low vacancy rate, which has for a decade hovered around, and sometimes below, one per cent, according to city statistics, well below the three-to-five per cent considered healthy.

But council didn’t approve, reject or modify the proposed changes. Instead, they voted, 6-5, to defer the decision to some point in the future pending further consultation.

There was a stark difference in the way some councillors described the situation at the July 24 meeting, which ran until 10 p.m. on a Friday as council worked through several days of packed agendas before their August break.

For NPA Coun. Colleen Hardwick, things were moving too fast, she saying these changes shouldn’t be “rushed through.”

“There is no need to push this through now,” Hardwick said. “We are in the middle of a pandemic, in the middle of summer, and many residents are not aware of the major changes being proposed here tonight.”

On the other end of the spectrum, Mayor Kennedy Stewart said this council is gaining a reputation for moving too slowly to address what most of them have described as a housing crisis.

“We’re criticized as a council for delaying, for being slower than most other municipalities,” Stewart told council. “I want to vote on this this evening, and I want to get on with building more rental housing in this city.”

As Stewart pointed out, in the commercial zones council was looking at, developers can currently build four-storey condo projects without seeking a rezoning. Stewart wants to push developers toward building more rentals, saying: “I cannot vote for more condos.”

Other councillors too insisted it was worth acting quickly. OneCity Coun. Christine Boyle, and NPA councillors Melissa De Genova, Lisa Dominato, and Sarah Kirby-Yung, also opposed the delay.

Boyle said: “We know that we need more rental more than we need more condos … These are changes we should make now, not postpone and delay.”

Dominato said the citywide planning process Vancouver is conducting now will take years to complete, and “we’re going to have to build the plane as we fly it, we can’t simply stop.”

But beyond the question of whether things were moving too fast or slow, Hardwick said she just doesn’t believe it’s necessary to boost rental-housing production at all.

Hardwick predicted the COVID-19 pandemic will reduce demand for rental homes, adding: “The buildings that will be built through these changes will not be completed for at least three or four years, which is well beyond the current moment and the formerly low vacancy rates to which proponents point to to justify the changes.”

Others, while not opposing building rentals, wanted to pump the brakes.

Green Coun. Adriane Carr introduced a motion to refer back to staff for “further public consultation,” through the fall, “including at the neighbourhood level.” The motion was seconded by Hardwick and supported by fellow Green councillors Pete Fry and Michael Wiebe, as well as COPE Coun. Jean Swanson and Independent Coun. Rebecca Bligh.

“We really need to consult the public well,” Carr told council. “I know there was a consultation process around a lot of stakeholders and the public did get involved, but I’d like it to be deeper than that and more vibrant.”

These proposed changes arose from the 10-year Housing Vancouver strategy, approved in November 2017 by the previous council after more than a year of public consultation. The first of the “key strategies and actions” in that plan was a “shift toward the right supply,” citing a need to “drive a significant shift toward rental, social and supportive housing” and away from building expensive single-family houses and condos, which had made up the vast majority of the housing production for many years but were increasingly unaffordable for many locals.

In November 2019, city staff reported to the current council on possible measures to shift toward that “right supply” of rentals over condos, and — as Dominato noted at last month’s meeting — there seemed to be broad agreement among most councillors at that time about this policy direction and the urgent need to add more rental housing.

So, it came as something of a surprise to some observers — and some councillors, and likely some city staffers — that council balked on this particular decision.

According to the city’s summary of the community consultation conducted on these proposals since last November, the idea of six-storey rental developments along high streets seemed relatively uncontroversial. Some residents expressed concerns around displacement of existing businesses, but many supported six-storey rental projects on main streets, while others suggested streets with frequent transit could accommodate even taller buildings.

It was another proposed rental incentive that drew more concern during this year’s consultation: changes to allow four-storey rental buildings on residential side streets just off arterials. That idea, according to the city, “received more comments and questions” than the six-storey buildings on main streets, and that piece was hived off from the proposal for arterial streets to come to council for a separate decision.

Consultation on the four-storey proposal is continuing until October through an online portal at shapeyourcity.ca, and council is expected to decide on that later this year.

The timeline for that decision, of course, could change.

 

© 2020 Postmedia Network Inc. All rights reserved.

Ontario’s Bill 184 poses risks to honest landlords, sellers and purchasers

Natalka Falcomer
REM

At the risk of being chased with pitchforks, I’ll say it: Bill 184 is not an unapologetic piece of pro-landlord legislation. I say this as someone who worked and volunteered at Parkdale Community Legal Services in the landlord and tenant division. I defended tenants exclusively in and out of the Landlord and Tenant Board and, without hesitation, I assert – the ethics of the landlord and tenant are more important than any legislation. Nonetheless, understanding Bill 184 is imperative for anyone selling or buying a tenanted property and it is imperative for real estate agents to understand it too.

 

Bill 184 contains a variety of amendments to the Residential Tenancies Act, 2006 that are beyond the scope of this article. This article focuses on what you need to know if you have a client buying or selling a rented unit.

Compensation for terminating a tenancy on behalf of a purchaser

While sellers in Ontario are already used to compensating tenants if the seller wants to terminate a tenancy early because a purchaser is moving in, section 49.1 adds a few more options. Under the new section, the seller is required to compensate the tenant in an amount equal to one month’s rent or to offer the tenant another rental unit acceptable to the tenant.

Compensation for terminating a tenancy for purposes of demolition, repairs, renovation or conversion

In the past, compensation for giving notice to a tenant due to demolishing, repairs, renovations or conversion of the unit applied only if the residential complex in which the rental unit is located contained at least five residential units. Going forward, these financial obligations extend to all complexes, even if the complex has only one unit.

In other words, a small landlord looking to renovate his basement apartment will have to compensate the tenant “an amount equal to one month’s rent or offer the tenant another rental unit acceptable to the tenant” (Bill 184, Schedule 4, Residential Tenancies Act, 2006). Certainly, the extension of such compensation is a win for tenants and an attempt to stop renovictions.

Affidavits now required when filling applications to terminate a tenancy

A common complaint that Bill 184 attempts to solve is the fact that some purchasers or landlords claimed that they would be moving into a unit, thereby requiring the unit to be vacant. The purchaser or landlord, however, would not move in; rather, they’d repair or upgrade the property and then re-let it for a much greater amount.

Such “renovictions” are caught by the new requirement that the landlord, seller or purchaser, as the case may be, must include in its application to terminate a tenancy a sworn affidavit. The affidavit sets out the reason for termination and, more importantly, if the person filing the application has filed a similar application within the last two years. This affidavit will be used against the applicant if they have a history of moving into tenanted units for a suspiciously short period of time.

While I understand the need to prevent renovictions, I can imagine circumstances in which an applicant can be unjustly denied the ability to move into a unit they own and truly intend to occupy. Buyers should be aware of this set back and the possibility that, if they’ve moved into tenanted units in the past and have filed applications for such evictions, they could be denied the ability to take possession.

Nefarious behaviour will come back to haunt you

Bill 184 takes another step to ensure that landlords, sellers and purchasers are not lying about their intention to actually live in a tenanted unit. Going forward, the Landlord and Tenant Board can consider the landlord’s previous use of notices of termination under Sections 48, 49 and 50 to determine the intentions and good faith of the landlord. If the landlord seems to have a nefarious history and the board finds the landlord to be acting in bad faith, it will cost the landlord a lot more than it has in the past.

Acting in bad faith will cost more

Critics of the act claimed that the fines imposed on landlords who behaved badly were not harsh enough to dissuade renovictions, slumlords or fudged increases in rent. The penalties have been increased from $25,000 (in the case of a person other than a corporation) and $100,000 (in the case of a corporation) to $50,000 and $250,000, respectively.

In addition to the increase in fines, if the board finds that a landlord has acted in bad faith in terminating a tenancy under Sections 48, 49 or 50 (applications for a landlord’s personal use, a purchaser’s personal use or for demolition, conversion or substantial renovation), the board may now order that the landlord compensate the former tenant “in an amount not exceeding the equivalent of 12 months of the last rent charged to the former tenant”.

This amount holds firm even if the actual rent paid was less than what the landlord charged. This 12-month rent compensation is in addition to the imposition of an administrative fine of up to $35,000 and compensation to the tenant for “all or any portion of any increased rent that the former tenant has incurred or will incur for a one-year period after vacating the rental unit” and/or any “reasonable out-of-pocket moving, storage and other like expenses that the former tenant has incurred or will incur”.

Given all of these changes, purchasers and sellers alike should be extra cautious. If you represent a buyer who has evicted tenants in the past in order to move into a unit, they may have problems with the board if they plan to move into a unit that is tenant occupied.  Landlords or sellers should also factor in the various new costs associated with evicting a tenant for legitimate reasons such as renovations to a basement unit, for example. While punishing those who act dishonestly is highly endorsed by this writer, it also appears that acting honestly just got more expensive.

 

 

© 1989-2020 REM Real Estate Magazine

Local real estate board has tough news for Calgary homeowners

Ephraim Vecina
Mortgage Broker News

The Calgary housing market needs to brace itself for a long-term downturn, according to the Calgary Real Estate Board.

Second-quarter home sales volume, which was 35% slower annually, might be a significant indicator of the trend despite better performance compared to prior estimates, the CREB said in its report.

“The situation may look brighter than it did a few months ago, [but] it is also important to note that challenges remain,” the CREB said. “Our local economy is still facing record-high unemployment rates, with significant job loss occurring not only in areas associated with the shutdown (e.g., accommodation and food, retail trade) but in our professional, scientific and technical services sector. Some of the jobs in areas impacted by closures will start to return as our economy re-opens, but the challenges weighing on the energy sector will likely have a lingering effect on employment.”

New listings fell to 2,557 units in July, from the 3,335 properties available as of the end of Q2.

“The pullback in new listings in the second quarter caused inventories to trend down, preventing a more significant decline in prices,” the CREB said.

However, the local economy will be burdened by the prolonged recovery of the highest-paying industries, with downside risk to the housing sector likely to last well into 2021.

“This will cause some persistent challenges for the upper end of the housing market, having a greater impact on those higher-priced homes versus product in the lower price ranges,” the CREB report said. “Overall, we continue to expect city-wide benchmark home prices to ease by just under 3% this year and sales activity will remain weak compared to the already low levels recorded last year.”

 

Copyright © 2020 Key Media

MLA Canada: Greater Vancouver seeing a shortage of condos

Ephraim Vecina
Mortgage Broker News

The latest data from MLA Canada showed that condo inventory delays hound the Greater Vancouver market, a trend that might slow down the region’s housing recovery.

Over the last few months, the COVID-19 pandemic led to severely decelerated activity across all housing types. Pre-sales have not been spared from this downturn.

While Greater Vancouver saw an 8% month-over-month increase in new supply for condo pre-sales in June, the level was still roughly 50% lower on an annual basis, and 57% below the anticipated units for that month.

 

Actual pre-sale activity in June fared better, up by 51% from the May reading. However, similar to the inventory situation, Greater Vancouver pre-sales were 50% lower year over year.

“Units are being absorbed at an incredibly low rate, but similar to last year,” Better Dwelling said in its analysis of the MLA figures. “The sales to new listings ratio (SNLR) reached 14% in June, the same ratio as last year. … Sales are significantly lower this time around, and so is inventory.”

Local industry players agreed with this assessment, saying that Vancouver remains far below its usual stellar performance as one of Canada’s leading real estate destinations. On the other hand, Vancouver is actually exhibiting steady recovery from its 2018-19 “nadir,” according to the Canada Mortgage and Housing Corporation’s June report.

 

Copyright © 2020 Key Media

Home buyers willing to pay extra for SkyTrain proximity

Kenneth Chan
other

 

New data shows home buyers in Metro Vancouver are still willing to pay for the premium of being within close walking distance from a SkyTrain station.

While there is currently an aversion to public transit, the health crisis has only had a minimal effect on buyers’ willingness to pay for the above-assessed value for an apartment, according to real estate marketing and analytics firm Roomvu.

 

For every kilometre away from the closest station, buyers are likely to pay 0.61% less over assessed value in the initial COVID period (March 15 to May 30) — down slightly from 0.63% in the pre-COVID period (January 1 to March 14).

“There was a strong relationship between the distance from the closest transit location and the percentage differences between sales price and assessed value,” reads the report.

“The result clearly indicates that apartment units close to the stations are still being sold at a premium over their assessed values in the post-COVID lockdown period.”

The distance penalty per km from the closest station is highest for Burnaby North (+3.7%), followed by Burnaby South (+2.1%), Vancouver East (+1.9%), New Westminster (+1.3%), Vancouver West (+0.7%), North Surrey (+0.1%), and Richmond (-0.3%).

“It looks like access to transit got more valuable over the course of time,” said Thomas Davidoff, economics and professor at UBC’s Sauder School of Business, in a statement.

“Prices of transit-friendly homes rose over the course of the year in spite of the far-reaching negative economic consequences of the pandemic.”

On average across the region, most apartments sold are priced above their assessed value, with the final sales prices for these homes at 4.4% above the assessed value, with buyers willing to 4.6% above assessed values during COVID compared to 4.3% before the pandemic.

 

© Copyright 2020 DailyHive