BMO says Toronto condo boom has “run its course”
In a client note the Bank of Montreal suggests that the huge growth in condo development and sales in Toronto may be coming to an end. The comments come after the CMHC published figures showing a slowing of housing starts in August to a four and a half year low. BMO economist highlights figures from two years ago when the annual number of starts was 40,000; in 2014 it’s 16,500. Building permit numbers also fell massively in August, down 43.5 per cent. BMO economist Robert Kavic notes however that there are around 56,000 units currently under construction in Toronto so there is new supply to come. Kavic suggests that oversupply won’t be an issue in the city as things return to more balanced levels. Read the full story.
Toronto condo rental growth at 2 year low
It’s not just condo construction that has slowed in Toronto; the pace of rentals has also eased. Although there has been a 10 per cent year-over-year increase in rentals, there has also been a decline in the third-quarter compared with the first half of the year. The figures, from condo research firm Urbanation, show a two-year low in rental growth which they say is partly down to fewer investors putting properties on the rental market but is also a sign of things to come. Shaun Hildebrand from Urbanation says rentals are returning to a more sustainable level. Read the full story.
Calgary outpacing national average on new home sales
New figures from StatsCan show that Calgary is new home prices in Calgary are growing by the biggest amounts in Canada. The New Homes Index showed a monthly rise of 0.5 per cent and an annual rate of 6.8 per cent. This is compared to a monthly 0.3 per cent and 1.5 annual rate across the nation. The second highest annual growth rate was 3 per cent in Hamilton; less than half that of Calgary. Builders say land development costs and favourable economic conditions are fuelling the market. Read the full story.
Affordability is Vancouver’s hot election issue
The two main contenders to become Mayor of Vancouver are being challenged to table policies that will tackle the issue of home affordability in the city. With high-housing costs at odds with a median wage that is below the national average, being able to afford a home is the highest concern of the city’s voters. Options being considered by the potential mayors include re-zoning to allow smaller, more affordable housing to be built on existing single-family plots; and more condo and town houses along arterial roads. New high-rise condo developments have tackled supply issues but have so far not helped affordability. Read the full story.