Vancouver council backs controversial Kitsilano social housing development

David Carrigg
The Vancouver Sun

Thirteen-storey B.C. Housing project at Arbutus and 7th Avenue will provide permanent shelter for 129 homeless people

 An artist’s rendering of the Arbutus project in Kitsilano that will provide 129 single-occupancy units. jpg

Vancouver council has approved rezoning for the second of five B.C. Housing developments in the city that will create 424 suites for single homeless people.

Council voted Tuesday night in favour of rezoning a city-owned site on Arbutus Street in Kitsilano between 7th and 8th Avenue (alongside the planned Arbutus subway station) to permit a 13-storey building with 129 one-person social housing units offering mental health and other supports. The project will be managed by the MPA Society, a long-standing non-profit agency with 220 full-time employees.

Each unit will have a kitchen and bathroom and occupants will have security of tenure, said Celine Mauboules, the city’s director of housing and homelessness services. She said that 99 per cent of the estimated 250 people living in tent and tarpaulin structures along Hastings Street at the moment would jump at the chance to occupy one of these units.

Last week, a community group called The Kitsilano Coalition asked the City of Vancouver and B.C. Housing to reconsider the Arbutus social housing project after the then housing minister, David Eby, fired the board of B.C. Housing. They were fired because it was found the agency sometimes handed out multi-million contracts without a rigorous process to ensure the best provider is chosen.

Some neighbours worried the new development would affect safety in the area, fearful of the situation when the 147-unit Marguerite Ford social housing project on the 200-block of West 2nd Avenue opened and generated over 700 police calls in 18 months. The development is also across the road from an elementary school.

Coun. Colleen Hardwick, who is running for mayor in the October municipal election, was the strongest advocate for those neighbours and voted against the project. Councillors Melissa De Genova and Sarah Kirby-Yung also opposed the project.

Hardwick said 75 per cent of 300 speakers at council were opposed to the project, including mental health researcher Dr. Julian Somers, retired provincial court judge Tom Gove — who ran the downtown community court — and the staff of the nearby Sancta Maria House recovery home for women.

“Instead of standing up and demanding a better model, the majority of city council accepted the failed model presented by B.C. Housing as good enough,” Hardwick said.

Coun. Adriane Carr — who backed the project — noted that former mayor Gregor Robertson had promised to end homelessness by 2015 and that it was a false promise with homelessness in the city “worse than ever.”

Coun. Lisa Dominato said the community consultation process for the project was deficient, but the MPA Society had a good reputation and would work to create a good mix of tenants.

The project was backed by the rest of council and Mayor Kennedy Stewart.

“As more and more neighbours are pushed to the streets due to a lack of supportive housing, this project provides hope of a better way forward,” Stewart said in a statement. “129 residents will soon have their own place to call home, with wraparound services which will ensure they are well supported.”

Part of council’s approval was that the MPA Society and B.C. Housing create a advisory group to hear about any concerns once the project is operating, that a flashing pedestrian controlled traffic light be installed at 7th and Arbutus and that the project consider offering more than just single-person occupancy in the units.

The other B.C. Housing project that has been approved is on the 1400-block of King Edward Avenue East. This will be a 14-storey building with 109 units operated by the Vancouver Native Housing Society.

The three projects that have not yet received rezoning approval to go ahead are a planned six-storey building at 2930 Renfrew St. offering 50 single units operated by Lu’ma Native Housing Society, a six-storey 64 unit development on the 2500-block of South Grandview Highway run by Community Builders and a six-storey 72-single-unit project at 1925 Southeast Marine Drive operated by The Kettle Society.

 

© 2022 Vancouver Sun

Douglas Todd: Why is Vancouver so secretive about this First Nations’ highrise project?

Douglas Todd
The Vancouver Sun

Opinion: With bulldozers moving in and roadways being prepared on park grass, Kitsilano residents near the Senakw project say the city is proceeding behind a cloud of confidentiality

 Squamish Nation Council Chairperson Khelsilem and Vancouver Mayor Kennedy Stewart discuss a Senakw agreement, which is unavailable to the public, at a press conference at the Museum of Vancouver Wednesday, May 25, 2022. Photo by Jason Payne /PNG

Bulldozers recently dug up land next to the Burrard Bridge. Large trees have been cut down. Construction fences went up last week.

 

And new survey signs mark where a road is planned to run across Vanier Park, which will provide access to Sen̓áḵw, which urban analysts say is the most dense highrise development ever proposed for Canada.

Yet last week, until nearby residents notified them, even Vancouver park board officials didn’t know a road was being prepared across the parkland it operates. They launched an investigation and requested a stop on the encroaching work.

Meanwhile, Vancouver city council is doing everything it can to support the Squamish First Nation in erecting 11 highrise towers, with some skyscrapers soaring to 59 storeys, on a narrow portion of reserve land in Kitsilano at the west side of the bridge.

The Kitsilano Point Residents Association strongly supports the Indigenous undertaking, seeing it as a potential act of reconciliation. But its directors believe, along with former Vancouver mayor and B.C. premier Mike Harcourt, that the property is being overdeveloped.

 

And they’re especially bothered by city council’s secrecy, the complete lack of any consultation with residents and voters. They describe the city as operating behind a thick cloud of non-transparency, confidentiality, hidden reports, in-camera meetings and councillors being sworn to secrecy — while the city paves the way for roughly 10,000 new residents to pack in closely beside the bridge.

 

Artistic rendering, aerial view, of the proposed Senakw development in Kitsilano, from website created by Westbank Corp. Nearby residents say such drawings don’t show roadway through Vanier Park. PNG

The city says it has no “mandate” to hold hearings on the massive construction effort, since it’s on a reserve. But in May the city signed a memorandum of understanding, which isn’t available to the public, to provide water, sewer, electricity, police and firefighter services to the project of the Squamish Nation, which is in partnership with Westbank Corp., a developer of mostly luxury condos.

 

Kits Point residents, however, are among those bothered that the city hasn’t held one public event on Sen̓áḵw’s community impact or on whether it intends to provide schools, transportation, recreational centres, traffic mitigation or amenities in response to the megaproject, which they say will be 10 times more dense than the West End.

The residents’ group isn’t alone in being worried. Former Vancouver councillor Gordon Price, an urban affairs scholar, has written a piece about it, titled, How do we talk about Senakw?

While Price endorses B.C.’s “new era of billion dollar Indigenous real estate projects,” he laments there was no public consultation a decade ago when the Tsawwassen First Nation built a megamall on precious Delta farmland. He fears the Senakw project will also be pushed through by hushing dissent.

 

“But if reconciliation of any kind means being honest and open, to declare interests and be open to accommodation, then this is that time,” Price says. “The best outcomes will be if there’s a sense of mutual benefit.”

Neither the city, nor the 4,000-member Squamish Nation’s development arm, the Nch’Kay Corp., have provided Vancouver residents with commitments regarding Sen̓áḵw, including the proportion of units for renters, condo owners or businesses.

Still, a Westbank-developed website, called Sen̓áḵw, says the highrise development “represents an opportunity to heal.”

The site adds: “The world is full of too much talk, and too little action.” The aim of the Sen̓áḵw development is to “construct 6,000 homes in Downtown Vancouver in as little as five years, start to finish. Ready to commence construction in 2022.”

 

 

The proposed development site. Photo by Francis Georgian /PNG

Sen̓áḵw will help resolve the city’s housing crisis, the website claims, because it’s being built on “reserve land, with the Squamish Nation in the driver’s seat: no drawn-out approvals or permitting delays.”

A Nch’Kay Corp. representative said officials weren’t immediately available to respond to Postmedia News’s questions.

A City of Vancouver official, however, said in a statement: “Vancouver land-use policies and regulations are not applicable to these (reserve) lands, nor is the city directly involved in any part of the planning or design.”

Even though city officials have been negotiating for two years to provide infrastructure to Sen̓áḵw, the statement said, “there is no timeline” on when staff or council will engage with residents on transportation or other issues. In regard to a services agreement, it said, “the city will make the details public shortly.”

 

While the city acknowledged Vanier Park is leased by the federal government to Vancouver and is operated by the park board, it suggested Ottawa is responsible for approving the road through the park. Staff ignored a question about whether the city, as lessee, requested the roadway.

Eve Munro of the Kits Point Residents Association said city councillors and officials are being “disingenuous,” including about “the unprecedented level of secrecy surrounding the Sen̓áḵw  development.”

Munro, a lawyer, accepts that Sen̓áḵw isn’t subject to the city’s normal consultation process because it’s on reserve land, which was granted to the Squamish Nation in 2000, along with $92 million, for relinquishing its claim to Kits Point and other lands.

 

However, Munro said “there is nothing stopping the city from consulting about how the residents of the city would like to have their resources deployed … in support of a development of this scale and density.”

 

Vancouver’s mayor and city staff are “promoting a false narrative suggesting the nature of the (Senakw) development is beyond their influence and control,” says Eve Munro, a director of the Kitsilano Point Residents Assoc. She stands with Jeremy Braude, centre, and fellow direct Scott Dunlop on the site’s would-be access road on Vanier Park property. Photo by Francis Georgian /PNG

Vancouver Mayor Kennedy Stewart recently commented about a services deal with the Nch’Kay Corp.: “We have an obligation to provide services as a good neighbour. To use that as a tool for blackmail really isn’t in the spirit of reconciliation.”

But Munro said the mayor and staff are “promoting a false narrative suggesting the nature of the development is beyond their influence and control.”

Other B.C. municipalities faced with urban reserve developments, she said, have not been so reluctant to protect their community’s interests.

 

Jeremy Braud, whose home is close to the project, said Kits Point residents generally feel “a lot of good will” toward the Sen̓áḵw development. But he worries the lack of transparency is creating a “public relations disaster. If I don’t know what’s going on in my backyard, I think the worst.”

It’s not only the city, he said. There is nothing to stop the Nch’Kay Corp. from reaching out to residents.

In his article on Sen̓áḵw, Price cautioned that “there will be a real danger of it getting pulled into a political culture war” if community concerns aren’t taken seriously.

“Guilt and shame are ultimately counterproductive ways to negotiate a healing future,” Price said. But he said if Sen̓áḵw, one of many Indigenous developments in the works in Metro Vancouver, proceeds with respect shown by all sides it could turn into the city’s “next great megaproject.”

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© 2022 Vancouver Sun

Ontario home sales activity still slowing down

Ephraim Vecina
other

The rapid rise in interest rates and continually elevated inflation levels are taking their toll

 New home sales in Ontario continued to ease in June, a trend that was especially apparent in the Greater Toronto Area (GTA), according to Altus Group and the Building Industry and Land Development Association.

A total of 1,694 new homes were sold in the GTA in June, representing a significant annual decline of 56%, and hovering 52% below the 10-year average for that month. New condo home sales totalled 1,519 units, down by 44% annually and 36% below the region’s 10-year average for the asset class.

Single-family home sales fell by 85% year over year, accounting for just 175 units sold.

“New home sales numbers for June reinforced the expected easing of sales from last year’s exceptionally fast pace,” said Edward Jegg, research manager at Altus Group. “With interest rates continuing to rise, high inflation, affordability pressures, and general economic uncertainty, many buyers are adopting a wait-and-see attitude that is expected to run through at least the summer months.”

Read more: How much do you need to afford a home in Toronto and Vancouver?

The number of new homes remaining in the market was 11,639 units, comprised of 9,717 condominium apartment units (3.5 months of inventory) and 1,922 single-family units (2.7 months of inventory).

Benchmark prices stood at more than $1.8 million for new single-family homes (up by 31.2% annually) and at nearly $1.2 million for new condo apartments (up by 12.4%).

“While many prospective home buyers in the GTA are delaying purchasing the homes they need in the midst of economic uncertainty, our region’s fundamental challenges around housing supply remain unresolved,” said Dave Wilkes, president and CEO of BILD. “Shorter-term demand-side economic conditions and inflationary pressures cool demand but increase the costs of new builds simultaneously. This will continue to impact overall supply.”

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Metro Vancouver industrial vacancies ease as supply increases

Frank O Brien
Western Investor

With more than 1.7 million square feet added this year – and more on the way – the vacancy rate has eased to a still-tight 0.5 per cent, study finds

 Metro Vancouver’s industrial vacancy rate, which hit a North American low of 0.1 per cent this year, according to Colliers, has eased to 0.5 per cent due to a huge increase in supply, a new Cushman & Wakefield market survey says.

The report notes that 1.7 million square feet of industrial space was completed so far this year and another 1.8 million square feet, mostly speculative, is under construction,

“The vacancy rate will likely bounce in the 0.5 per cent range for the next few quarters,” said Derrick Gonzales, a research analyst with the commercial real estate agency, who noted that this remains a historically low number.

Up to 80 per cent of the new space being built has been pre-leased or pre-sold as strata, Gonzales estimated.

This is good news for developers but bad news for tenants who are facing dramatic increases in lease rates and dwindling options, according to Cresa, a Vancouver-based occupier-focused commercial real estate advisor.

“The distress for warehouse users continues with region-wide vacancy falling to a crippling 0.57 per cent, down from 0.62 per cent in the fourth quarter [2021], and 2.1 per cent a year ago. Per-square-foot warehouse rents jumped by $0.63 during the first quarter to $16.78 and were up by $2.09 from year-ago levels,” its report concluded.

Industrial lease rates increased to an average of $18 per square foot in the second quarter, Cushman & Wakefield reported, with some markets flirting with $20 per square foot for new product.

Approximately 683,739 square feet of new supply was added to the Metro Vancouver and Fraser Valley regions in the second quarter. Notable completions included Conwest’s build-to-suit development for Lordco in Port Coquitlam (341,113 square feet); buildings B & C at Wesmont’s multi-phase industrial strata project in Langley City (160,880 square feet); and Beedie’s strata project at DECA Business Center at 7927 River Road, Delta (45,584 square feet).

Several additional projects are slated for completion in the second half of 2022 and Gonzales doubts they will have any problem being absorbed.

“Wholesale trade and third-party logistics groups are looking 18- to-24 months in the horizon in securing industrial space in an extremely competitive supply-constrained marketplace,” he noted in the report. “This quarter, Conwest fully leased its large bay multi-unit development at 1725 Coast Meridian Road in Port Coquitlam one quarter prior to completion while Beedie fully leased its multi-unit project at Parallel 32 in South Surrey’s Campbell Heights which is scheduled for a fourth quarter of 2022 completion.”

But, with interest rates increasing and lease rates skyrocketing, Gonzales cautions that smaller companies may be muscled aside in the hunt for Metro Vancouver industrial space.

© 2022 Western Investor

Calgary housing market – where opportunities remain

Fergal McAlinden
other

The city’s market has cooled in recent weeks, although prices remain robust

 With Canada’s housing market in the throes of a sharp decline in sales and activity, one city that’s proven especially resilient in recent weeks has been Calgary.

Alberta’s most populous urban sprawl actually saw total sales climb from July 14-20 compared with the same week last year, according to statistics from the Calgary Real Estate Board (CREB), posting an increase of over 9% (496 sales in 2021, compared to 542 in 2022).

The city’s year-to-date sales are nearly 23% higher than this point last year, while CREB noted in its latest monthly report on housing that it’s “unlikely” a full reversal of price gains in the year to date will take place anytime soon.

Activity heated up in the city roughly between November 2021 and February this year, Calgary-based broker at Mortgages for Less, Josh Tagg (pictured top), told Canadian Mortgage Professional. That period saw multiple offers on properties, with many would-be buyers having to go in without conditions attached to their bids.

Read next: How are brokers advising their clients on rate hikes?

It was a trend that mirrored the frenzy that became the norm in red-hot markets like Toronto and Vancouver, but Tagg said it “quickly calmed down” when the Bank of Canada began its rate-hiking trajectory in March.

It’s resulted in fewer transactions on a month-to-month basis, with many buyers deciding that they’d prefer to wait out those rate increases and bide their time until they either start inching lower or stop rising, although that sentiment is likely to be “short-lived,” according to Tagg.

That’s because the impact of higher rates is offset somewhat, he said, by the fact that the housing market is cooler with fewer bids and lower risk of having to overpay.

“While some people are going to be priced out of the market due to the rate increases, I think there will be enough people that will recognize [those] increases are temporary,” he said.

“But price increases last longer. If they have a low rate but they spent $30,000 more on a house [over list price], that’s not actually saving – it’s a little bit of a higher rate for a shorter period of time. [Meanwhile] not having to outbid somebody in a bidding war actually comes out more favourable than paying $30,000, $40,000, $50,000 extra on the house.”

The woes of first-time homebuyers, who often saw themselves outbid and priced out of property during the pandemic housing market boom, are well documented. That landscape could be shifting, though, as the market cools – even though interest rates are creeping upwards.

“A first-time buyer that’s well positioned is still going to have lots of opportunity out there,” Tagg said. “The entry market and the condos and townhouses – that never really went up nearly as much as the detached market anyway. And so first-time buyers still have opportunity, as long as they have a bit of a cushion in their income to get through any future rate increases that are happening.”

The Bank of Canada’s recent rate jump means that most borrowers are now having to qualify at a level above 5.25% because that figure is lower than their contract rate plus 2%. That might push some buyers to their maximum approval amount – and although that cohort is likely to move to the sidelines as a result, there will still be plenty of Calgary buyers who won’t be dissuaded from entering the market, Tagg said.

Read next: What’s next for Canada’s housing market?

“Those that were not going to spend the maximum they would qualify for anyway, or have higher income levels and can still get themselves a home they’re happy with well under the upper limit of what they could qualify for – those are the ones that I think we’re going to see continuing to buy homes over the next little while,” he said. “And not until we start to see rates trending in a downward direction are we going to get those that are pushing the upper limits of what they would qualify to buy.”

Ultimately, Tagg stressed that the real estate and mortgage markets would remain robust despite that rising-rate environment, with variable rates still representing an excellent opportunity even though they’re moving upwards along with the Bank of Canada’s benchmark rate.

“The sky isn’t falling. The interest rates are only going to go up a little bit more, by about 1%,” he said. “It is definitely better to take that variable rate than the fixed in almost all cases, because then you get to ride it back down once maybe 18 months from now when interest rates start to go down.”

The cost of extra interest is lower in most cases than the added price of the homes when the market’s hotter, he reiterated, noting that a cooler market could be a welcome development for many across the province.

“I think that’s the silver lining in all of this: that removing some of the competition has pulled some of the out-of-province buyers out,” he said, “and it’s allowing things to kind of reset and get back to more normal for those who are in Alberta.”

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Daphne Bramham: With Canada failing to meet its immigration promises, B.C. needs more control

Daphne Bramham
The Vancouver Sun

With the system in shambles, provinces like B.C. want more control over who comes and more money to settle newcomers, including Ukrainians.

 Afghan refugees head for buses after arriving at Toronto Pearson International Airport. Photo by M.Cpl. Genevieve Lapointe /Canadian Forces Combat Camera

Across B.C., “Help Wanted” signs are ubiquitous. Labour shortages have forced businesses to drastically cut their hours, hospitals and emergency rooms to close, as well as planned and unscheduled cancellations of B.C. Ferries sailings.

Despite grumbled anecdotes about people not wanting to work, B.C. has one of Canada’s highest workforce participation rates.

Bear in mind that last year, B.C. also had the highest number of new arrivals recorded in 60 years — 100,797 people. International migration was the second-highest recorded, while cross-country migration was the highest in nearly 30 years.

Even with that, and despite a seemingly intractable, affordable-housing crisis, the fact is B.C. needs more people to fill essential jobs.

And that is exactly why the provincial government wants Ottawa to give it more control over who comes here, and is asking for more money to help settle all the newcomers.

Last year, only 6,750 people came under the provincial nominee program that allows provinces to select applicants whose skills and training match labour needs. Next year, it wants 8,000 nominees, and 10,000 three years from now.

It made the request ahead of Thursday’s meeting of federal and provincial immigration ministers.

Nathan Cullen is B.C.’s municipal affairs minister and has responsibility for immigration. He describes the program as “more precise” than other immigration programs, noting that B.C.’s priority last year was health-care and long-term care workers.

“(The nominee program) is not a blunt instrument, which is what a federal immigration program is by its nature,” he told Postmedia before leaving for the federal-provincial meeting in New Brunswick.

“We’ve just heard from Ontario and they’ve been making similar requests of the feds to gain a little bit more control over what happens.”

As a former MP, Cullen isn’t certain how much of its “cherished authority” Ottawa is willing to give up. But he hopes to convince Federal Minister Sean Fraser that expanding the nominee program, which has a much faster turnaround time than myriad other immigration streams, will help clear the backlog of applications that is nearing two million files.

The benefit isn’t just a bureaucratic one. With skills matched to jobs, it should also mean that highly skilled newcomers don’t end up driving taxis instead of doing the jobs they are trained for.

Of course, there is a huge caveat that Cullen readily acknowledges. Canada is glacially slow in recognizing internationally obtained credentials — especially for physicians and surgeons. Here, he said it can take up to three times as long as in other G20 countries — “And if you’re slow in this kind of world, it means you just don’t get the person at all.”

The minister plans to raise that at Thursday’s meeting, along with concerns about what might best be described as Canada’s “do-it-yourself” immigration offer to Ukrainians.

Within days of the Russian invasion, Prime Minister Justin Trudeau offered safe haven and a pathway to citizenship to all Ukrainians who could find their own way here.

“We’re not ready for them, and we need the feds to be,” Cullen said. “(Federal politicians) have had time. There’s no more excuses like, ‘It’s all happening so fast.’ That’s done. They’ve had the time and the program has not been set up properly yet.”

With the usual processes waived, Ukrainians are arriving and often there is no one to meet them. Nobody knows when they are coming, where they are landing, or even how many of the six million who have fled might end up here as Russia intensifies its attacks.

Earlier this year, B.C. shored up settlement societies with nearly $15 million because the number of immigrants and refugees arriving is beyond the capacity that Ottawa has funded them for. And last month, the province set up a hardship fund for Ukrainians offering up to $1,770 a month for a family of four.

Ukrainian-Canadians have also stepped in to fill the gaps since the only federal help Ukrainians get is a two-week housing allowance.

Still, with no contact point with any agency or government, vulnerable women, children and unaccompanied minors are open to exploitation. It’s something that keeps Cullen awake at night.

Already, his officials had to rescue one family who had found rental accommodation on social media. When they arrived, the landlord confiscated their passports and tried to restrict their movements. Fortunately, they had a contact in the Ukrainian community who got in touch with the ministry.

Meanwhile, immigrants are enduring months-long waits in overcrowded hotel rooms in dangerous neighbourhoods because there is nowhere else to go until settlement societies or concerned citizens manage to scrounge something better. Sometimes, it’s from developers waiting for demolition permits.

Cullen insists that recent increases in housing starts and measures his government has taken to get unused housing into the rental pool is starting to make a difference. But he said it is still going to take more time to even out.

Immigrants also need health care and schools for their children. Those, too, are provincial costs.

So far, the federal government has failed to match its immigration promises and targets with the money necessary to properly fulfill them.

Small wonder that the provinces want more control and more money.

“We have to match the story we want to tell about ourselves as being a generous, open country … with the resources and the determination that’s required,” Cullen said.

And right now? That’s not happening.

 

© 2022 Vancouver Sun

What brokers need to know about rent-to-own options

Fergal McAlinden
other

A ‘people first and property second’ approach is essential, says expert

 Among the options that mortgage brokers recommend to clients who can’t qualify through a bank, it’s fair to say that rent-to-own offerings rarely feature at the top of the list.

That niche arrangement, which usually caters to borrowers who aren’t currently able to afford the money down that’s required for a mortgage or have blemished credit, lets would-be buyers make payments on the home they’re renting that go toward both rental costs and a future down payment on that property.

It’s aimed at navigating borrowers through a timeframe, usually between two and four years, that will allow them to repair credit and put together the funds required to eventually purchase. Unlike a standard rental agreement, monthly payments are made up of a bundle that includes carrying costs (property taxes, insurance, and mortgage) as well as a down payment instalment.

Part of the reason that many prospective buyers have traditionally been reluctant to consider entering into a rent-to-own agreement is that in the past, they were often viewed as skewed to the landlord’s needs, according to Rachel Oliver (pictured top), a leading authority on the subject.

That meant the owner of the property might charge a premium to the rent-to-own tenant – without having a clear or realistic understanding of what it will take for that individual to ultimately afford the down payment at end of term.

“At the end of the day, rent-to-own is all about achieving a goal of qualifying for a mortgage on a particular property,” she told Canadian Mortgage Professional. “And if you don’t approach the process with that end goal in mind, things fall apart very quickly.

Read next: Canadians’ debt concerns surge amid rising rates

“So that’s the point when people were kind of doing a one-on-one arrangement. There were a lot of topsy-turvy kind of agreements, things written on the back of a paper napkin, he-says-she-says scenarios, and really poor success rates.”  

Still, Oliver emphasized that rent-to-own arrangements can represent a good option for Canadians when working with a company whose interests firmly align with their own – and that works with a clear and consistent process. She serves as managing partner at Clover Properties, which offers rent-to-own options under what Oliver described as a “people first and property second” mantra.

That’s tailored toward Canadians who have been turned away by a lender but don’t want to return to renting while they work out their credit situation and how to come up with the funds required for a down payment on another property.

“Let’s face it, life happens and it’s very difficult to manage all of those moving parts on your own,” Oliver said. “You need some guidance, you need some help, and our program creates a framework, structure and accountability process [so] that once [clients] move into that rent-to-own home, they’ll get that during the rent-to-own term.”

Those programs also designate a budget based on the stress test in Canada, she added, to ensure that borrowers meet the lending criteria in the marketplace, before they find a suitable property before receiving projections on what their monthly commitment and down payment instalments will look like.

Read next: New HELOC regulation – what do brokers need to know?

If the client agrees to the numbers, a private investor steps in to purchase the home. “They have a 20% down payment and they want to help the [renting] family,” Oliver said. “Really, this process is families helping families with our team in the middle, making sure that nobody oversteps boundaries, and everyone is getting an arrangement that is going to be equitable.”

Rent-to-own customers know exactly what price they’re to eventually buy the property for up front, Oliver said, with all conditions pre-negotiated prior to the term beginning. There’s also no penalty to exit early and purchase ahead of schedule – unless the investor has, for instance, a variable-rate mortgage with a differential penalty, which is then transferred on to the rent-to-owner.

Of course, there are plenty of risks associated with rent-to-own products; RateHub emphasizes the importance of a solid agreement with legal protection and clear understanding of contract stipulations among both parties.

Working with a credible company in the space is essential, too, said Oliver, who encouraged mortgage brokers to research those options in more detail and “take the time to understand how rent-to-own can help certain clients – especially in a market where so many people can’t even afford a private mortgage.”

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B.C. slaps three-day cooling off period on real estate sales, starts Jan. 1

Gordon Hoekstra
The Vancouver Sun

The homebuyer protection period, the first of its kind in Canada, goes into effect on Jan. 1, 2023.

The B.C. government announced Thursday a new cooling off period on real estate sales, a measure meant to protect homebuyers pressured in high-risk sales. Photo by Azin Ghaffari/Postmedia files

The B.C. government announced Thursday a new cooling-off period on real estate sales, a measure meant to protect homebuyers feeling pressured in high-risk sales.

 

The homebuyer protection period, the first of its kind in Canada, goes into effect on Jan. 1.

It was immediately condemned by the B.C. Real Estate Association, which represents 24,000 real estate agents.

The cooling-off period will give a buyer three business days following an accepted offer to conduct due diligence such as inspections, seeking legal advice and confirming financing.

The cooling-off period is one of seven recommendations the B.C. Financial Services Authority made in May to protect consumers in B.C.’s real estate market.

“Too many people have been faced with giving up an inspection in order to buy a home,” B.C. Finance Minister Selina Robinson said Thursday. “This is a major step toward providing homebuyers with the peace of mind they deserve while protecting the interests of people selling their homes — for today’s market and in the future.”

 

The homebuyer protection period includes a cancellation fee of 0.25 per cent of the purchase price, or $250 for every $100,000, for those who choose to back out of a deal. For example, if the purchaser cancels on a $1-million home, they would be required to pay $2,500 to the seller.

Trevor Koot, the real estate association’s CEO, said the sector was extremely disappointed in the minister’s decision to implement the homebuyer protection period in isolation from other measures

“This goes against the advice of the province’s real estate regulator, which — in May — recommended several consumer protection measures to be implemented as a package, not à la carte,” he said.

Koot said the government’s decision undermined the independence and expertise of the province’s real estate regulator and should concern British Columbians. He said the B.C. government needs to give the B.C. Financial Services Authority the power to conduct its own research and make its own decisions with respect to regulation.

 

The province says it is continuing to study the advice from the authority, which oversees credit unions, mortgage brokers, and insurance companies in addition to real estate.

In November, the province announced plans for a seven-day cooling-off period, but the B.C. Real Estate Association pushed back. It said it preferred another recommendation from the financial services authority — a pre-offer period that would require a listing be on the market for a minimum of five days before any offer was accepted.

The real estate association has said, ultimately, the only way to increase affordability is to increase supply.

Tsur Somerville, senior fellow at the UBC centre for urban economics and real estate said, “The homebuyer protection period is something that is long coming and much needed as a modernization package for how homes are purchased in British Columbia and for the stability, accountability and transparency of the entire market.”

 

Andrey Pavlov, a professor of finance at Simon Fraser University’s Beedie School of Business, said the cooling period is a misguided policy because it does nothing to remove the obstacles to increase housing supply, such as overcoming the very lengthy city approval process for development and a cumbersome building code.

He noted the cooling period could discourage sellers, which would further restrict the already highly insufficient supply of housing.

Pavlov said he believe the timing is also counterproductive as the housing market is experiencing a slowdown, if not in prices, in sales, due to high and increasing interest rates.

The Financial Services Authority also recommended sellers be required to provide property disclosure forms and key strata documents up front as part of the listing process.

 

And their advice included a requirement for buyers to disclose offers made on other properties, to discourage buyers from submitting several concurrent offers and to allow sellers to make an informed decision if there is the possibility a buyer may walk away from a sale for reasons other than those related to the immediate sale.

Other suggestions include requiring sellers to disclose how many and the value of offers have been received in cases of bidding wars where potential buyers are being asked to revise their offers, as well as standardizing certain clauses in home purchase contracts, such as financing, home inspection and legal advice.

With Postmedia files.

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Luxury markets start to normalize following surge

Micah Guiao
other

The period of its “historically anomalous performance” is over

 The major metropolitan luxury real estate markets broke consecutive records throughout 2021, but have since started to normalize midway through 2022, according to Sotheby’s International Realty Canada.

Demand for luxury properties intensified in 2021 with both domestic and non-resident activity reaching unprecedented levels. In an earlier report, Sotheby’s found home sales valued at more than $4 million to have surged by 224%, while ultra-luxury sales valued at more than $10 million have shot up by 238% from 2020 levels.

The real estate franchisor called it a “historically anomalous performance” – one that 2022 has proven was not meant to last.

Read next: What has prompted the luxury housing market’s surge?

By the first half of 2022, residential sales priced $1 million and above sank 10% in the GTA. The causes behind its slowing performance are linked to the rise of everything – inflation, mortgage rates and international geo-economic headwinds.

However, the Sotheby’s report said it was “near-term hesitancy” at worst, considering that the demand for housing and consumer confidence in top-tier real estate remain strong.

“Even as the market gradually came into balance, Greater Toronto Area residential real estate sales over $4 million were up 7% year-over-year from previous records set in the first half of 2021,” the report said. “Sixteen (16) properties sold over $10 million on MLS, one unit more than the record number of ultra-luxury properties sold above this price point in the first half of 2021.”

Read more: Luxury market sees record-breaking 2021 performance across the board

On the other hand, the market for luxury condominiums continued unharmed as affordability challenges continue to push homebuyers toward high-density housing.

“$4 million-plus condominium and attached home sales posted annual gains of 13% and 100% in the first half of 2022, surpassing previous record activity in the first six months of 2021, while single family home sales over $4 million were up a modest 6%,” the report read.

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Province backs off goal to build 114,000 new homes

Peter Mitham
Western Investor

Units added to the secondary rental market now part of the tally

The province says it won’t build the 114,000 affordable new housing units it intends to create by 2028.Sandor Gyarmati/Delta Optimist

According to the province, more affordable housing is a key goal of this week’s announcement that the four-year-old speculation and vacancy tax will expand to six new jurisdictions next year.

The tax, levied on the value of unoccupied or underutilized residences, will now apply to properties in Lions Bay and Squamish as well as the Vancouver Island communities of North Cowichan, Duncan, Ladysmith and Lake Cowichan. This brings to 14 the number of regional districts and municipalities where the tax applies, jurisdictions home to 73.5 per cent of the province’s residents.

The vacancy tax is one of the tools that B.C. Finance Minister Selina Robinson said the province was wielding in order to achieve the BC NDP’s long-standing ambitions to create 114,000 new affordable homes in the province by 2028.

“There is a drastic shortage of affordable housing in the province,” Robinson’s predecessor as finance minister, Carole James, said in formally announcing the goal in the 2018 provincial budget. “We are going to build the homes people need.”

But according to Robinson, not all those homes will actually be built.

While the province pledged $6.5 billion towards the creation of 114,000 housing units in 2018, Robinson told Western Investor this week that the province intends to build just a third of the total.

“The expectation is about 39,000 [units] is what we’re going to be delivering with that [$6.5 billion],” she said.

The remainder will be delivered through initiatives such as the speculation and vacancy tax, which she repeatedly described as “one tool in the toolbox” to address the need for housing and affordability.

Rather than funding new construction, the tax effectively coerces people with more than one home to rent out second properties, under pain of a 0.5 percent tax on the assessed value of their homes if they’re Canadian nationals or two per cent if they’re foreign nationals.

She said the tax has so far prompted property owners to return a total of 20,000 condos to the Metro Vancouver rental market since 2018. (The claim is based on Canada Mortgage and Housing Corp. estimates of the secondary rental market. To give credit where credit is due, some of those units may in fact have returned to the rental stock as a result of the City of Vancouver’s empty homes tax.)

But repurposing existing units isn’t enough. Recent reports by CMHC, Scotiabank and the real estate industry have flagged a sheer lack of housing relative to population as a persistent and deepening problem. The stock is essentially too small to house everyone adequately, and more needs to be built.

A report CMHC issued June 23 estimated that 570,000 new homes of all types are required in B.C. by 2030 to meet the broad range of housing demand that exists and restore any semblance of affordability to the market.

Robinson said the province has funded 34,000 new affordable homes to date. The remaining 60,000-odd units towards the province’s 114,000 goal will be built in partnership with municipalities, which will lead the creation of housing at sites – for example – adjacent to rapid transit lines.

“You’re seeing now significant action being taken … as we invest in SkyTrain out to Langley and out to Arbutus,” she said.

But the province’s performance has left observers unimpressed.

An analysis earlier this year by Marc Lee of the Canadian Centre for Policy Alternatives noted that just 11,000 units had been completed while a further 12,500 were deemed to be in progress.

“Overall, the BC government’s performance is still far too modest to make a real dent in housing affordability,” Lee concluded. “Given the crisis of affordable housing, we urge the BC government to take on more of the heavy lifting.”

Anne McMullin, president and CEO of the Urban Development Institute in Vancouver, said many of the projects funded by the province are caught up in the same municipal approval processes that have stymied developers.

She supports calls by the BC Urban Mayors Caucus for the province to set housing targets based on the municipal housing needs reports the province has required municipalities to prepare since 2019.

“[We’re] hoping to see some legislation in the fall from the province to address that,” she said.

 

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