Canadian Real Estate Report: 2021 Housing Impacts to Condo Sector

RE/MAX Staff
other

 Staggering gains in detached housing values have sent condominium sales soaring throughout the first eight months of 2021 in major Canadian real estate markets, according to a new report by RE/MAX Canada

The RE/MAX Canada 2021 Condominium Report, which examines trends and developments in five major Canadian real estate markets and more than 100 sub-markets, found that buyers turned to condominiums in 2021, as freehold housing values escalated beyond their reach. The strongest gains in sales were made in the West, where Greater Vancouver and Calgary saw condominium sales rise 87 and 83 per cent respectively between January 1 and August 31 of 2021, compared to the same period in 2020, which experienced a notable downturn in condo sales. The Greater Toronto Area (GTA) led the East in terms of percentage increases in condo sales at 71 per cent, followed by Halifax-Dartmouth at 36 per cent and Ottawa at 29 per cent. The greatest upswing in pricing occurred in the East, with both Halifax-Dartmouth and Ottawa posting double-digit price gains of 30.0 per cent and 18.0 per cent respectively. More moderate appreciation was reported in Greater Toronto (seven per cent), Vancouver (6.7 per cent) and Calgary (three per cent).

“Affordability, coupled with availability, set the stage for the exceptional rebound in condominium sales across Canadian real estate  markets in 2021,” says Christopher Alexander, Senior Vice President, RE/MAX Canada. “Double-digit acceleration in detached housing values revived slumping condominium sales early in the year, with demand shifting into high gear as detached supply dwindled and prices accelerated. Younger buyers have been behind the push for condominiums to date, with most looking to lock in low interest rates and buy before prices climb beyond their means.”

Growth in condo market share across the Canadian real estate market occurred in all but one regions surveyed, according to the RE/MAX Canada 2021 Condominium Report. The greatest concentration of condo sales was reported in Greater Vancouver, where condos represented nearly half (48.2 per cent) of total residential sales in 2021, up from 46 per cent one year ago. Condominium apartments and townhomes in the GTA followed with a 34.5 per cent share of the overall market, up from 30.8 per cent one year earlier. Almost one in four properties sold in Ottawa between January 1 and August 31, 2021 was a condominium, compared to the same period in 2020 (24.3 per cent versus 23.3 per cent). Meanwhile in Halifax-Dartmouth, the condominium segment represented 17.3 per cent of total residential sales, up from 15 per cent one year earlier. While overall sales climbed in Calgary year-over-year, condominium market share declined by just under one per cent in 2021, to 14.2 per cent.

“Home-buying activity in the condominium segment has surged in Calgary in 2021, driven in large part by their affordable price point,” says Elton Ash, Executive Vice President at RE/MAX Canada. “Supply has declined from almost eight months to just under five year-over-year, although inventory levels are still 16 per cent ahead of 2020 levels. Once excess product is absorbed – and that is occurring at a steady pace throughout the city – condominium values are likely to experience further appreciation, especially as the average price for detached housing continues to climb in the city.”

Regional Canadian Real Estate Insights

GREATER VANCOUVER CONDO MARKET TRENDS

While strong demand has contributed to a significant uptick in condominium apartment sales in the Greater Vancouver Area, more moderate gains have been reported in terms of price in 2021. According to the Real Estate Board of Greater Vancouver (REBGV), the average price of a condominium apartment hovered at $740,221 in August of 2021, an increase of 6.7 per cent over the August 2020 average of $693,691. 

 

Copyright © 2021 RE/MAX Ontario-Atlantic Canada Inc.

Real estate agents caught on hidden camera breaking the law, steering buyers from low-commission homes

Tiffany Foxcroft
other

 A CBC Marketplace investigation has found that some real estate agents are breaking the law by steering unwitting buyers away from low-commission homes. 

Posing as homebuyers and sellers, Marketplace tested if real estate agents are engaging in this anti-competitive behaviour and found some agents deceiving the very buyers they are supposed to represent, in an effort to pad their own bottom line.

• Watch the full investigation tonight at 8 p.m. (8:30 NT) on CBC-TV or stream anytime on CBC Gem.

Experts and industry insiders say what Marketplace has uncovered is indicative of an industry working for the benefit of real estate agents, at a cost to home sellers and buyers.

“There’s a huge inertia, and maintaining the status quo, it absolutely benefits existing realtors 100 per cent,” said broker and real estate agent Michael Walsh, one of the few speaking out on this issue.

The Canadian Real Estate Association (CREA) and the Real Estate Council of Ontario (RECO) would not talk to Marketplace about the investigation. However, shortly after learning about the findings, RECO issued a notice about steering to the over 93,000 real estate agents, brokers and brokerages under its purview, noting that such behaviour breaches the code of ethics.

“In addition to being illegal, the conduct undermines consumer protection, consumer confidence and the reputation of the real estate profession as a whole,” said the notice.

Across the country, the National Realtor Code of Ethics, as well as provincial real estate laws, dictate that agents must act with honesty and promote the interests of the individual they represent. Some provincial laws, including in Alberta and Ontario, address the issue of steering specifically.

The Real Estate and Business Brokers Act (REBBA) in Ontario states that when a buyer enters a representation agreement with a real estate agent, the agent “…shall inform the buyer of properties that meet the buyer’s criteria without having any regard to the amount of remuneration, if any, to which the brokerage might be entitled.” 

Not doing so is called steering.

But those calling the practice out say RECO and other regulatory bodies are not doing enough to protect consumers and foster an industry that is fair and free from abuse.

Joanne Petit, in Vaughan, Ont., put her house up for sale  without a real estate agent to help save on commissions that would have cost over $73,000. (Dave MacIntosh/CBC)

‘It’s not fair, and I think more people have to know about it’

When Joanne Petit and her husband, Frank, put their house up for sale this spring they decided to do it without a real estate agent. 

Joanne and Frank lived in Vaughan, Ont., where agents typically charge home sellers five per cent commission on the sale price of their home. In Joanne’s case, this would have amounted to over $73,000 plus 13 per cent HST.

In real estate sales, the commission paid to the listing agent by the seller is shared with the agent representing the buyer. Typically the commission is split in half.

In the industry, it’s referred to as the co-operating brokerage commission, and when a property is advertised on the Multiple Listing Service (MLS), the industry rules require that an amount of commission for co-operating brokerages must be included. This information, however, is hidden from public view and only visible to other agents and brokerages through an internal version of MLS.

To save on some of these costs, Joanne decided to skip the listing agent and instead paid a $200 flat fee to a discount brokerage that listed her house on MLS but left the rest of the work to her.

“I know there have to be people like myself looking on MLS to buy a house … and [they would]  say to their agent, ‘I would like to see this house,'” she reasoned. 

 

Petit’s home was listed on MLS for a $200 flat fee. She decided to do the work of selling herself to save the $36,000 she would have been charged by a listing agent. (David MacIntosh/CBC)

Joanne was still prepared to pay the real estate agents representing the buyer one per cent commission, which totalled nearly $15,000. After six weeks on the market, Joanne received zero calls from agents with interested buyers.

“They called a lot because they wanted us to sign with them, they wanted us to list with them, they wanted to be the selling agent,” said Joanne, who eventually asked one of those local agents why no buyers were interested. She says he informed her that her house had been, in the words of the agent, “blackballed.”

“Agents want to work with agents, and agents want their 2.5 per cent commission,” Joanne told Marketplace. “It’s not fair, and I think more people have to know about it.”

Marketplace producers posed as homebuyers with hidden cameras

To test if Joanne’s house was indeed being snubbed by agents avoiding the low commission,  producers from Marketplace posed as homebuyers looking to purchase a home just like hers and in the same neighbourhood. 

The team contacted three local real estate agents who showed up first in an online search.

Each of the agents was asked to book a showing for Joanne’s property as well as two other nearby properties listed on MLS. 

Marketplace‘s test found that two out of the three agents steered the potential buyers away from Joanne’s home.

While one agent was upfront with the buyers about the low commission and offered to help the would-be buyers purchase the home anyway, the other two agents did not tell the buyers about the commission and discouraged or thwarted them from seeing the home.  

One of the agents steered the buyers by telling them the house was overpriced by $200,000, and said the owners would not budge on price. The other agent told them she was unable to book a showing at all, and suggested the property might have tenants, a turnoff for many homebuyers wanting to move in themselves.  

WATCH | Real estate agents found ‘steering’ on camera:

 

Hidden cameras show real estate agents steering  buyers away from low-commission homes

Marketplace posed as potential homebuyers and asked real estate agents to show them a low-commission home being sold by the owner, Joanne Petit. Some agents attempted to steer the would-be buyers away from the property. 2:12

Joanne said she never received a call from the agent who said she couldn’t book a showing.

She says the other agent did call but didn’t ask if they would be willing to negotiate, even though that agent told the buyers they would not. Joanne says the agent also didn’t inquire about the price of the home, which was in line with other sales in the same area.

“Right off the bat, she wanted to know if she was getting 2.5 per cent [commission]. When we told her that there would only be a one per cent commission, she said, ‘OK, thank you, I’m not interested, I’ll keep my clients to myself.'”

The identities of the three agents have been concealed because Marketplace‘s investigation determined that this problem is industry-wide, and not isolated to these specific agents. 

In a second test, Marketplace made calls to 50 real estate agents in five markets across Canada. Half the time the team called as homeowners looking to sell, and half the time as buyers. When producers asked 25 agents if they, as sellers, could lower the commission they offer to buying agents, 88 per cent warned against doing so. 

“Although they’re not supposed to do it, some agents may be very cognizant of what they’re getting paid and push their buyer to another home,“ said an agent in Halifax.

“I have had agents say to me, ‘You know we’re looking at two houses, they’re both a good fit but I’m definitely sort of massaging them towards yours because there’s more in it for the realtor,'” said another agent in Winnipeg.  

‘It’s just completely unethical’

RECO says that commissions are negotiable and “sellers decide how much, if anything, they wish to offer to pay a buyer’s brokerage,” but when all 50 agents were asked about the commission they charge, nearly all quoted the same amount. A quarter of the agents referred to their fee as standard, and the majority said they would not negotiate. Marketplace shared what they documented with real estate lawyers including Lisa Laredo, who’s practised real estate law in Ontario for over 15 years. 

“It’s beyond steering, it’s just completely unethical,” said Laredo about the hidden camera test. “You’re not actually providing a service, you’re not servicing anyone but yourself.” 

 

Lisa Laredo, a real estate lawyer in Ontario, says steering by real estate agents is against the law and unethical. (Norm Arnold/CBC)

When Marketplace reached out to the two agents who steered, both denied doing so. The one also stands by her assessment the house was overpriced.

Michael Walsh, who runs an agency exclusively for buyers, is not surprised by the findings of Marketplace‘s test and says the current framework for real estate sales enables steering. 

“That’s part of the inherent issue in the model where buying agents are offered compensation by listing agents. We wouldn’t be having this conversation if that wasn’t in place.”

Historically, all real estate agents only worked for home sellers and only had a fiduciary duty to them. It wasn’t until the 1990s that buyers’ agents came to exist in Ontario after some agents advocated for the change. However, the commission structure, wherein sellers incentivize agents to bring buyers, remained in place. 

Michael Walsh is the president and broker at Exclusively Buyers Inc., a brokerage that only represents homebuyers. (David MacIntosh/CBC)

Walsh and researchers studying the industry agree that the only way to truly fix this problem is to change the way real estate agents are paid, so the buying agent’s commission is not paid by the home seller via the listing agent.  

‘The industry functions as a cartel’

“In terms of commissions, the industry functions as a cartel. They enforce on the entire industry a certain high and relatively uniform commission level,” said Stephen Brobeck, a senior fellow and former executive director of the Consumer Federation of America, a non-profit organization based in Washington, D.C.

Brobeck’s research, which spans over 20 years, has determined that “decoupling” realtor commissions could drop the standard rate of real estate commission by one to two per cent over a couple of years, saving consumers billions of dollars a year.

“If the commissions are decoupled, for the first time buyers would be able to negotiate their commissions and they would come down. That would also encourage sellers to negotiate more vigorously with their listing agents and those would most likely come down,” Brobeck said. 

“Furthermore, it would give discounters a far greater opportunity to penetrate this marketplace, because they would not have to pay the going rate for buyer agent commissions.”

• Click here for full statements from those featured in this investigation

Brobeck’s argument and how commissions are paid is also at the core of two large anti-trust lawsuits in the U.S against the National Association of Realtors and major brokerages including RE/MAX LLC, Keller Williams and Realty Inc. The class-action suits claim that “anticompetitive conduct causes America’s homebuyers to pay inflated commissions.” These claims are also currently under investigation by the U.S. Department of Justice.

Discount brokerages make up about 10 per cent of the market share in the U.S. There are no figures available for Canada but it’s considered to be about the same or less according to discounters in the industry.  

Stephen Brobeck is a fellow with the Consumer Federation of America. He says with respect to commissions, the real estate industry functions as a cartel. (CBC)

Brobeck says it’s now up to provincial governments to make this change happen. Until then he also recommends that consumers not give up on negotiating the commission they pay.

“If you’re a seller you ought to try to negotiate the commission down by a full percentage point,” he said. “Secondly, if you’re trying to sell an expensive home, or you’re working with a broker who will help you sell one home and buy another home, they may knock an additional percentage point off the home.”

Joanne and Frank, however, remained steadfast in their resolve to sell without a listing agent. 

“The right person is going to come along at the right time,” said Joanne defiantly.

And in the end, patience did pay off. After three months on the market, they sold their house near full asking price to a private buyer, with no agents involved.

• If you have tips on this or any other story, please email the Marketplace team at [email protected]

©2021 CBC/Radio-Canada

Can the First-Time Home Buyer Incentive be salvaged?

Fergal McAlinden
other

It remains to be seen whether proposed tweaks can revive the much-maligned federal program

 On paper, it seemed a welcome break for Canadians hoping to enter the housing market: a federal incentive program aimed at reducing the monthly mortgage burden and easing the passage to home ownership for qualified first-time buyers.

Over two years after its introduction, though, the jury is still out on whether the First-Time Home Buyer Incentive, unveiled by the federal government in September 2019, has had any significant impact in addressing the mounting challenges faced by would-be homeowners across the country.

Figures released to Parliament in April painted a damning picture of the program, revealing that it had seen an uptake of just over 9,000 successful applicants since its introduction – with the $170 million released in incentives representing a small fraction of the program’s $1.25 billion overall value.

One of the most significant stumbling blocks in the incentive, which offers mortgage relief through a shared-equity program between homebuyers and the government, appeared to be the fact that ever-soaring house prices across much of Canada meant that it had little impact on prospective buyers in the country’s hottest markets.

While the government introduced changes to the program late last year – announcing increased household income and buyer’s income thresholds for Vancouver, Victoria and Toronto – those amendments still meant that the program’s maximum eligible home price remained well below the going rate in those markets.

The program has faced staunch opposition from the get-go, with Conservative MPs Tom Kmiec and Stephanie Kusie urging the government to scrap the scheme in May 2020 after it had been in operation for less than a year.

Read more: Conservative MPs urge feds to eliminate First-Time Homebuyer Incentive

Still, the governing Liberals have stuck resolutely by the plan, announcing in their platform prior to September’s federal election – in which they were returned to government, having emerged once more as the largest party in Parliament – that they would retain and rejig the scheme if re-elected.

Under that platform’s proposals, changes to the program would give applicants a choice between the current shared-equity approach and a loan that’s repayable when the property is eventually sold – theoretically allowing new homebuyers to keep more of any increase in their home’s value while also reducing mortgage costs.

CanWise Financial president and RateHub co-founder James Laird told Canadian Mortgage Professional in recent weeks that the First-Time Home Buyer Incentive was an “illogical, complex program” that made little sense and should have been abandoned completely, rather than reworked.

In Newfoundland and Labrador, Robert Jennings (pictured top), owner and mortgage broker at East Coast Mortgage Brokers, said that while the scheme was often raised as a topic among clients, actual uptake had proven limited.

“I would say we have a fair amount of conversations, but it doesn’t lead to a lot of usage,” he said. “The usage rate is very low. I believe if I were to pinpoint it, the lean on the property [government involvement] would be really discouraging to a young, proud first-time homebuyer.

“I feel like maybe in Newfoundland in particular, there’s a home ownership pride that they don’t want to share or give up… Of course, there’s the eligibility issues as well. It seems like in a lot of cases trying to put a square peg in a round hole.”

Read next: What the Canada election result means for the mortgage industry

While Jennings said that the scheme had arguably fallen short in its attempts to create a smoother path to first-time home ownership, he believes efforts at a federal level to address the country’s growing housing affordability crisis are to be applauded.

“Everybody made it a big deal in their platforms – not just first-time home ownership, but home ownership in general and affordability,” he said. “I just really hope that they re-evaluate everything.

“They had good intentions, but I feel like they missed the mark. There’s no reason not to try; the problem’s not going away. I’d like to see what happens when the dust settles and I hope that it [the housing crisis] remains a priority, because they certainly made it seem like it would on the campaign trail.”

A good place to start, Jennings said, would be for the federal government to work collaboratively with stakeholders and those who work daily in the mortgage and housing industries – whether that be on changes to the stress test or potential longer-term amortizations.

“What I want is them not to do things blindly,” he said, “to embrace input, do their homework and try to get it done – but also get it done right.”

 

Copyright © 1996-2021 Key Media, Inc.

New Bristol Estates in Surrey includes over 2,000 homes

Peter Meiszner
other

The owners of Bristol Estates in Surrey are planning a major redevelopment of the low-rise rental apartment complex, with towers up 48 storeys and over 2,000 new homes.
ZGF Architects is working on the concept for the redevelopment, tentatively called “Landmark Bristol.” A rezoning application has submitted to the City of Surrey, and if approved, construction of phase one could start as early as 2023.

The existing complex of 156 rental apartments was built in 1968 and the units are at the end of their service life. The 6.27 acre property is 500 metres from the Surrey Central SkyTrain station and in an area seeing rapid redevelopment.
The proposal for Bristol Estates calls for:
2,000 strata condos in five towers (48, 44, 43, 40 and 38 storeys)
170 secured market rental apartments (11 storeys), with 20 per cent rented below CMHC average rates allocated for returning tenants
Two new streets
Daycare facility
Local serving retail space
Public art at the gateway(s) to the development
Urban forest and stormwater strategy

The Surrey Centre Official Community Plan aims to transform the neighbourhood from a suburban town centre into a walkable, high-density and transit-oriented downtown for the South of Fraser region. The density and mix of uses is meant to create a city centre that is “more animated, livable and a place that thrives economically where residents can work, play, and live in their neighbourhood.”
Recent coverage of Surrey City Centre development
BlueSky Brightside brings 1,300 homes to Surrey City Centre
A SkyTrain runs through it: Thind Properties garners approval for Surrey towers
Central City Tower 2 announced at Invest Surrey
Centre Block Surrey to include 47-storey office tower

Copyright © 2021 UrbanYVR 

Michael Geller’s Blog

Courtney Dickson
other

 Yesterday, Vancouver Is Awesome the Glacier Media ‘successor’ for The Vancouver Courier, the beloved newspaper for which I wrote a regular column for many years, reported on the forthcoming discussion on the future of South Shore False Creek, scheduled for Vancouver City Council this Thursday October 21st. 

In years gone by, I would have written a Courier column in advance of this discussion, or signed up to speak. But since the Courier has folded, and I have meetings Thursday with a delegation of German planners and politicians interested in learning about Vancouver’s waterfront developments and a community organization in Squamish, I will share some of my thoughts on the city’s proposal here.

As background, the following is an excerpt from the Vancouver is Awesome account of the meeting:

 Future of False Creek South

As Glacier Media reported last week, the city has released a “conceptual development plan” for 80 acres of land it owns and manages on the south shore of False Creek.

The plan contemplates tripling the number of housing units and adding new buildings of six to 28 storeys high. A 500-footer adjacent to the Granville Bridge is also a possibility, although the staff report emphasized the word “conceptual” in the plan.

“It is important to note that these potential heights and densities have not been reviewed by [senior managers] or any other city staff from a regulatory perspective, and thus do not reflect forms of design that have to date been approved or considered to be supportable from a land use planning or regulatory perspective,” the report said. 

Staff will deliver a presentation to council Thursday, which will include more details about the city’s plan to negotiate with existing leaseholders on the lands. Staff will also explain how the plan justifies increasing the number of housing units from 1,850 to 6,645 and keep a housing mix of approximately one-third market strata leasehold, one-third market rental and one-third non-market/co-op housing units.

Some of the questions from council will undoubtedly concern how such level of development on a shoreline can be done over the next 20-plus years when city staff have previously raised concerns about sea level rise. Staff’s presentation is expected sometime Thursday morning.

Past of False Creek South 

I have a particular interest in this community since from 1975 to 1977 I served as CMHC’s Special Coordinator for the project. I was given this responsibility since most of the other people in the CMHC Branch Office thought the proposed community development would fail and any association with it would not be a career enhancing move. They were not alone. A senior Vancouver planner resigned his position since he too thought the south shore of False Creek was no place to build a family-oriented community. The Board of Trade also opposed the development, and the Park Board, led by commissioner George Puil argued that the entire site should be a park, not housing.

As a 28 year old architect and planner who at the time was Program Manager-Social Housing, I was confident the development would succeed. I had previously lived in Toronto and England, and worked in other cities across Canada where major redevelopments on former industrial lands had succeeded. Moreover, I was not planning to stay with CMHC forever. 

While I intend to write more about the background planning for South Shore False Creek, using publications from my home library including “CREATING A LIVABLE INNER CITY COMMUNITY -VANCOUVER’S EXPERIENCE 1976” as reference, the purpose of this blogpost is to declare my support, in principle, for the direction being proposed by Vancouver staff and its consultants that include Chuck Brook, a former member of the Vancouver planning department and a highly regarded planner and real estate consultant who for years has been advising governments and other property owners on the planning and redevelopment of their properties.  

To be clear, this does not mean concentrating the more affordable housing in one area and the market housing in another. Nor does it mean doubling or tripling the density. What it does mean is regenerating the community by adding more market and non-market housing on both undeveloped and selected currently developed sites, and creating longer term certainty for the leaseholders of both the non-market and market parcels.

Details of what the city is initially proposing can be found in the staff report. You can find the 34-page staff report here: https://council.vancouver.ca/20211021/documents/pspc2.pdf

While I haven’t studied the report in detail, and it is devoid of the more detailed plans that many of us want to see, the redevelopment strategy is very similar to that implemented for the federally-owned Veterans Properties in Kitsilano and New Westminster which I undertook for CMHC in the 1980s. Recognizing the importance of allowing lower-income households and others who want to remain in the community to not lose their housing, the first step, following approval of an overall plan and strategy, is to build new housing  on available sites for those living in the older buildings. This in turn frees up many older housing sites for redevelopment with modern, more energy efficient homes at higher densities. 

Last week, I did two interviews with Global TV and CBC. Both asked me if I was surprised by what was being proposed and I said no. The fact is, the False Creek leases are generally for 60 years, and 45 years ago when the leases were first negotiated, it was contemplated by many of us that at the end of the lease term some sites would be redeveloped. This is contemplated in the leases whose wind-up provisions included two options: either extend the leases on appropriate new terms, or buy out the improvements at their then market value. (The province passed special legislation to require these provisions.) While I anticipate some significant disagreements over what constitutes the fair market value of the improvements, ultimately financial arrangements will be determined by appraisers and others.

I should add, as noted in the Global TV  interview that I did, many people will be very concerned with the city’s proposed approach, especially those who have lived in the community for many years, or in some cases, since the housing was first built. Why? Because at some point many will no longer be able to live in their homes. However, the city has promised that they will be relocated, and unlike the Little Mountain fiasco, their new homes will be built before they are asked to vacate.

There are obviously a lot of questions about this proposed redevelopment that need to be addressed. What should be the new plan? Where should the new  housing go? (I see a lot of potential to build new higher buildings along 6th Avenue, overlooking the park.)  Another question will be which buildings should be demolished and which can stay? I would expect many of the concrete buildings around Leg-in-Boot Square to remain, but most two and three storey frame buildings, especially those on prime sites, should be replaced with higher density and more energy efficient buildings.

Another question will be how to manage the redevelopment? Should the redevelopment sites be offered to one major non-profit and/or private developer, or should individual sites be offered on longer term leases to various private non-profit and private developers as was the case in the 70s? I should note that the city managed the redevelopment through a special corporate entity known as the False Creek Development Group. It’s office was on West Broadway, deliberately outside of City Hall, and the Group generally did a very good job. Then mayor Art Philips hired Doug Sutcliffe, a seasoned and highly respected individual to manage the redevelopment, Neil Griggs, who is still around, was one of the officials involved. In later years, Cameron Gray, one of the city’s most knowledgeable housing planners was involved. They will no doubt have some stories to share and ideas on how the city should proceed.

 

I too will be happy to share some of my experiences, not only related to the first phases of False Creek South, (or the last phase since I was part of the development team that built the last project -The Lagoons at the entrance to Granville Island) but also developing UniverCity, which in many respects is a modern day example of creating a livable, planned community.

 

So to the mayor and Council I say approve the staff report in principle and start to do the more detailed planning. Let’s have a public discussion about some of the details. But let’s be bold. And let’s not duplicate what can be found on the North Shore of False Creek. The Olympic Village may well be a better precedent for much of the new redevelopment. And oh yes, forget about the 50-storey tower beside the bridgehead!

 

©2021 CBC/Radio-Canada.

The growing threat of cybercrime in the mortgage industry

Fergal McAlinden
other

 Cybercrime figures released by Statistics Canada at the end of July made for sobering reading, revealing that the number of cybercrime incidents in the country have ballooned dramatically in recent years.

The agency said the police had reported over 63,000 instances of cybercrime in Canada in 2020, up from just over 48,000 the previous year and 24,000 in 2016.

As members of an industry that requires swathes of personal information from clients, the implications of that spike for mortgage professionals are clear. Speaking at a Canadian Mortgage Brokers Association (CMBA) symposium in Vaughan last week, Derrick Leue (pictured top), president and CEO of PROLINK – an insurance brokerage whose clients include private lenders and mortgage investment corporations – said that the amount of data stored by mortgage brokerages meant they needed to be fully aware of the risk posed by cybercriminals.

“This is a big reason why hackers would care about mortgage brokers and mortgage agents – as almost a conduit to get to lenders at times, or just get to the information they need to impersonate people,” he said.

“There’s a lot of valuable information that you’re holding on Canadians overall. So that’s why vulnerability is really something to be aware of and take seriously.”

Leue said it was crucial that brokerages have a response to potential cybercrime and breaches of security mapped out in order to mitigate the damage those attacks can cause.

“It’s about setting up your system so that when it happens… you respond really fast, and in the most professional way possible, so that the privacy commissioner is not going to take it to another level or worse, have a lawsuit against you as an individual or your firm overall,” he said.

Read next: RBC’s customer base makes it a favourite of cyber attacks – security experts

Claudiu Popu (pictured below), CEO of cybersecurity platform Informatica Security, told attendees that thousands of strains of ransomware (a malware that threatens to block access or publish data unless a fee is paid) had emerged in recent years, with figures indicating that it takes around 270 days on average for an infection on a corporate network to be discovered.

 

“We have this expectation that when we get infected, we’ll know right away,” he said. “That’s not the case; they case the joint and then they spread the malware across the network. Only when it’s convenient to them do they make themselves known.”

The current global number of active malware strains is also mushrooming: Popu said that on a daily basis, there are 10,000 new strains of malware being launched into the internet ecosystem, with Canada a top-10 contributor to new malware.

With that in mind, Popu stressed the importance of ensuring that passwords are robust and varied, with password leaks allowing cybercriminals to try them out on a variety of sites – meaning that individuals  who use the same password across a range of accounts are at greater risk of a widespread breach.

Using different passwords, and coming up with passphrases that are at least 14 characters long, is the best way to secure an account, Popu said – something that’s important to communicate to all employees using the same system.

While phishing, the sending of fraudulent messages to trick recipients into disclosing personal information, has been a significant trend in cybercrime for many years, Popu noted that messages related to the COVID-19 pandemic have emerged as a significant recent trend aimed at deceiving victims.

Where urgent action on a bank account might have been requested in the past, phishing messages are increasingly likely to mention vaccine passports or an imminent risk to health information if the recipient doesn’t click a link.

Read next: What brokers need to know about mortgage fraud

What hasn’t changed is the element of urgency in phishing messages, something that’s always a telltale sign of cybercriminals attempting to extract personal information from victims.

“All phishing messages in the world have something in common: urgency,” said Popu. “Introduce it in your security awareness training within your organizations, and try to make it easy for your users to think of the simplest possible cues that allow them to memorize some of these things.”

The good news is that prevention is possible, with both speakers emphasizing that training and privacy policies should be enforced and security controls, password management controls, antivirus software and security patches put in place.

Having written policies in place to manage cybersecurity risk or reporting is also becoming increasingly commonplace, with StatCan reporting last year that 38% of large businesses in Canada had a cybersecurity insurance policy compared with 24% in 2017.

Among businesses in the finance and insurance sector, that figure rose from 41% in 2017 to 55% in 2019.

Leue said that a cyberinsurance policy would give mortgage professionals access to a cyber breach coach service, with forensic consultants available to assess the damage, patch the problem and help rebuild the data.

It can also assist with any potential reputational damage caused by a data breach and with notification costs, as well as mitigating the risk of lost business, commission and fee revenue that arise from network and system outages as a result of an infection.

Popu said that having incident response teams and plans in place – and testing those on an annual basis – could make a big difference for companies in dealing with the risk of cybercrime.

Constant monitoring and alerting reduce the window of opportunity for criminals and mean that the 270-day timescale for the discovery of a serious breach can be reduced to a matter of hours.

“Have as many mechanisms in place to let people know when their account is accessed without authorization,” he said. “Response is very important, which is why we say you need to test your response plan and make sure that it works.

“The worst thing you can have in cybersecurity operations is a false sense of security.”

 

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Douglas Todd: Vancouver land assemblies come with a range of difficulties

Douglas Todd
The Vancouver Sun

Opinion: Land assemblies are expanding amid debate — not only over homeowners who don’t want to sell

The detached house looks almost comical — a drab Vancouver Special sitting forlornly on an overgrown lot, squeezed between two under-construction apartment buildings.

The odd scenario on Southwest Marine Dr. is becoming more common in Metro Vancouver, though, as realtors busily try to put together land assemblies for new condominium complexes by convincing a row of adjacent homeowners to sell.

Land assemblies are expanding in the midst of some debate — and not only because they present thorny situations for homeowners who refuse to sell, either because they like things the way they are or want more money. Housing specialists say land assemblies can also break up existing communities and in the long run raise house prices.

The pressure to find land to build housing on has been heightening in the core of Canadian cities. “The Greater Vancouver Area is growing while effectively sandwiched between the ocean and the mountains — there simply isn’t anywhere to go,” says FCT, a Canadian company that specializes in property deals, in some cases by providing insurance for land assemblies.

“Because land price is at a premium in cities, property owners with houses grouped together can command much higher prices than they could by selling individually,” says an advisory on FCT’s website . “Any contiguous group of properties can become part of a land assembly, but most often land assemblies include properties along or near a major transport conduit.”

University of B.C. geography professor emeritus David Ley, author of Millionaire Migrants , says municipal councils have been rapidly rezoning land throughout Metro Vancouver to respond to increased demand for housing, either to live in or as an investment . The rezoning encourages land assemblies, which can inspire argument.

“In part (a land assembly is) controversial because its major output has been luxury condos, which are not serving local affordability needs. And the cost of land assembly is forcing up land prices more generally, because it raises a homeowner’s expectations of what they will receive.”

Land assemblies can also play a role in destabilizing existing neighbourhoods, said Ley. “I suspect they decrease affordability.” One reason, he said, is that some older single-family homes are swept up into land assemblies for expensive new condos might have once included affordable secondary suites.

It’s relatively rare in land assemblies to come across “orphan homes” where owners don’t sell along with the rest of their neighbours, said Ley.

“I suspect greed is not the only reason people refuse to sell. But once a home is stranded with condos on both sides I’m guessing its value would or should drop considerably.”

Vancouver realtor David Hutchinson, who has taken part in land assemblies in Vancouver, Coquitlam and elsewhere, said he’s run into several holdouts during his career, including homeowners who don’t want to sell their detached dwelling even as every other house on the block is snatched up around them.

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It can often be hard for realtors to simply track down rightful owners. He’s knocked on doors and talked to people who initially say they don’t own the property in question, when it turns out they actually do.

“It’s hard to figure out their strategy. Everyone thinks the last man standing will get the most money. But we see that isn’t always true,” Hutchinson said.

No one was available when Postmedia tried to visit 83 Southwest Marine Drive, which now finds itself jammed awkwardly between two new apartment buildings on a busy thoroughfare.

The property title document for the dwelling says it was bought in 2005 by Richard Lee for $398,000. In 2021 the property was assessed at $1.65 million, down slightly from $1.82 million in 2019. The worn-looking structure is itself valued at only $88,000.

There are examples in Vancouver and elsewhere of holdouts who don’t end up with a profit as handsome as they had sought.

In one conflict in Vancouver’s West End, which went to court, a judge ruled that an attempt to assemble a 36-unit strata complex, called Barclay Terrace, could proceed — despite two condo unit owners not budging because they believed the price they were offered was too low.

While many owners at Barclay Terrace were selling far above assessed value, in the $1 to $2 million range, Ramin Malekmohammadi Nouri refused an offer of $3.5 million . Nouri’s asking price was $10 million, which BPTI, a company representing developers, called “absurd.” Negotiations ceased. And the judge ended up handing Nouri $2.2 million for his unit, which was only assessed at $672,000. 

In cities such as Toronto, some now consider it a real-estate pastime to guess which lonely old building next to a new tower or condo complex is an opt-out from a land assembly. That’s also happened in Vancouver, where social-media commentators and journalists have been trying to figure out why there is an abandoned gas station cheek-by-jowl with the ritzy new Vancouver House . The property owners won’t reveal the answer.

Land assembly deals can be risky and take a long time. As specialists such as FCT say, once the developer has a few properties together, pressure mounts to start construction. “Delays with a single holdout in the group of owners can motivate the developer to change their plans for the site, (by) simply building around the property instead of waiting for a deal on it.

”In high-priced Metro Vancouver, massive land assemblies are becoming one of the big games in town, regardless of their potential downsides. If you happen to own a home, especially one near a transit line or arterial, you can never know who might come knocking next — making an offer that’s difficult to refuse.

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