Here is our latest video on the Mississauga real estate market. We take a look back at 2016, and a look ahead to 2017. All signs point to continued strength in the market, as the three ‘pillars’ which are driving it – low interest rates, a decent local economy, and ongoing immigration into the Greater Toronto Area, are maintained. Will the ‘wild cards’ of the election of Donald Trump in the U.S.A., and the increased tightening of mortgage approval requirements by regulators in Canada, have an effect? Watch the video to find out.
January numbers are already in the books, and local newspapers are publishing reports of incredible bidding wars on average houses. It looks like we are in for another interesting year.
and here is a transcript of the video:
Hello everybody, it’s Randy Selzer here. Once again, thank you for joining me here on my YouTube channel, and how are you? Hope all is well, welcome back. Today, we’re going to look back a little bit at 2016 and see what happened in the market, and we’re also going to look forward to what to expect in 2017 in the real estate market here in Mississauga and also in the Greater Toronto Area. I think most of you are well aware that the, 2016 was incredible. The numbers have come out from the real estate board, and they’re showing about a 23% increase in average prices year over year, which is just an incredible amount to look at, and that’s a historical amount.
So that’s all great news if you’re a homeowner. If you’re a home buyer, it was very difficult throughout the year, trying to chase these listings when they came out, so many bidding wars, and pretty well every house had multiple offers on it, and condos, too, really picked up, especially in the last half of the year; so, as we look forward to 2017, I see a couple of competing things. I think the fundamentals are still there, which is what I like to talk about, the three pillars which are driving the market, and that is low interest rates, a decent economy in general, as well as immigration into the Greater Toronto Area, so those three things are still in place, and that’s all good news for real estate.
There are a couple of things, the kind of wildcards that are out there. One of them was the election of Donald Trump in the United States, and whether or not he messes around with NAFTA and some of the agreements we have with them could affect Canada, and certainly, the Auto Pact, if that gets canceled, that could have a huge effect on Southern Ontario, so we’re not sure where that’s going to go. We’ll have to just watch very carefully to see as it unfolds. The other thing to keep an eye on is that the Canadian Government has done a number of steps to try to slow the market down, it’s a little bit alarmed, I think, that the prices are so high; so as we talked about in another video, they recently required people to, with high-ratio mortgages, to get approved at a higher rate than what they’re actually getting, sort of as a buffer. In case the rates do increase, they’ll still be okay, and …
Also, just very recently, the CMHC fees were increased, and those are the insurance fees that a high-ratio buyer has to pay when getting a mortgage loan, so those two things have combined to make it considerably tougher, especially for first-time buyers, to get into the market. I think what we’re going to see is continued strength in the market for the first half of the year, and I think as these sort of legislative changes take effect, or they’ve taken effect, but as they kind of sift through the market, you may see some decrease in demand perhaps in the second half of the year, but I don’t have a crystal ball. These are just best guesses that I can come up with for where the market is headed.
For investors, the news, also, has been really good. The rental market has been extremely strong, rents are extremely high, and basically, everything is getting snapped up the minute it comes out; so for a rental, if you’re looking at making an investment and renting it out, specifically condos in Mississauga or wherever, that is, we predict that that’s going to continue, because a lot of people are simply priced out of the market to purchase, so they’re going to continue to rent, and that’s going to provide a nice pool of renters for investors.
Anyway, stick with me, we’re going to continue to do videos throughout the year. Hopefully, we can keep abreast of any of the changes that take place, and I wish you all well. Once again, if you have any comments, please feel free, on YouTube or any of the social media, to make comments, and I hope you get a kick out of these videos as much as I get a kick out of making them. Anyways, have a great day, and we’ll talk to you again soon. Bye.
One of the hottest topics in real estate circles in Canada these days is the proportion of offshore buyers, and if and how they are inflating prices in local markets. This month, the Canada Mortgage and Housing Corporation has released a report which investigates the extent of foreign ownership in the condominium markets of Canada’s major cities. One of the interesting stats to come out of the report is that foreign ownership of condos tends to be higher in newer buildings – those built since 2010 in the cities of Toronto and Vancouver.
CMHC reports that the rate of foreign ownership in the overall Greater Toronto Area (CMA) is less than 2% for condominium projects completed before 1990, but foreign ownership rises to 7% for condos completed since 2010.
For Toronto, foreign ownership of condos is highest in the downtown core of the city, where the numbers approach 10%. CMHC does note that the methodology used for their study allows for some leeway in the exactness of the numbers.
The foreign ownership totals are higher in Toronto, somewhat surprisingly, than they are in the Vancouver area, where foreign investors count for less than 2% of the projects built before 1990, a number which increases to about 6% for those completed since 2010.
Also interesting to note, there are some fairly large statistical jumps from 2014 to 2015 – for example, in the overall Toronto CMA, foreign ownership of condos in that single year jumped nearly a full 2 percentage points – from 5.5% to 7.4% – for buildings completed 2010 or later. It’s important to remember, however, that some of these numbers can be skewed by condo construction completions, and when there are a large number of completions in a single year, the foreign ownership numbers will grow correspondingly. The growth in foreign ownership of condos, nevertheless, as shown by these CMHC statistics, is obviously real , and hard to ignore.
So what are we to make of foreign ownership of condos, and how does it affect our local market in the Greater Toronto Area? I think that the numbers are still relatively low, although certainly 10% foreign ownership of newer condos in the downtown core of Toronto will have a effect on the market. Toronto’s growing role as a global city brings added pressures on real estate market pricing, it’s a simple matter of supply and demand. That new offshore investors are most interested in newer projects indicates that attention is being paid to many of the latest condo project launches, many of which are being marketed globally. It appears that the word is getting out there that Toronto, and its environs, are a good, stable, and safe place to invest. Going forward, I believe this trend will continue.
We went to check out Saks Fifth Avenue at CF Sherway Gardens this afternoon, which opened on Feb 25th. This is the second location of the Saks brand in Canada, after the downtown Bay location, which opened a week ago.
The Sherway Gardens store is located in suburban Toronto (Etobicoke), and is about 143,000 square feet in size. The store occupies three floors, in a space previously occupied by Sears Canada (east end of the mall). The mall seemed busier than usual, even for a Saturday afternoon, and the parking lot was full when we got there in the late afternoon. When we eventually got inside, there were large crowds of people.
We approached the store from inside the mall, and just at the entrance, we came across two metal statues of horses – one fully grown, and one colt, created by local artist John McEwen. They feature his trademark ‘stars’ incorporated into the metalwork, and are quite intricate in their design. The artwork is titled ‘The Miracle’. Between the two sculptures there is a fountain. We saw several people taking selfies in front of the statues.
Entering the Saks store, first impressions: extremely luxurious, with a very American vibe to it – which is a good thing, in my opinion. The store was busy, lots of people milling about, and we saw quite a few people purchasing goods. We first spent time on the main floor, which features shoes, accessories, & perfume, and the selection seemed vast. There are designer highlighted areas with every brand I have ever heard of, and many that I haven’t heard of. Everything from Gucci to Prada, Dolce & Gabbana to Stella McCartney, from Armani to Jimmy Choo.
I am no fashionista, but my girlfriend, who was with me, was impressed. Prices are not cheap, but these are some of the highest-end goods on the planet.
Next we went up to the second floor, which is dedicated to women’s fashions. At the top of the escalator there is an interesting display.
The second floor features another vast selection to choose from, with everything from lingerie to furs. This is not a bargain discount store, but we managed to talk to a couple members of the staff, and they were very friendly and welcoming.
Next, back down the escalator to the lower basement level, for a look at men’s fashions. Lots of high quality stuff here, including everything from business attire to casual, shoes, ties, and so on. The basement level is not quite finished, and although the men’s section is open, they are still finishing a Saks Food Hall, which is planned to open by March 7. On this lower level there were staff serving hors d’oevres, which we sampled, a nice touch!
There is a functioning restaurant on the main floor, Beaumont Kitchen, operated by Oliver & Bonacini, which we somehow managed to miss (too dazzled by those Stella McCartney purses, I guess)!
I think one of the biggest eye openers for most Canadians when they shop in the U.S., is that there always seems to be a much greater variety and selection of merchandise available there. Today at Sherway Gardens we saw a lot of high end merchandise which may have been difficult to find here in Canada prior to the entrance of Saks into the Canadian market. I mentioned some of the well known brands, but there are literally dozens and dozens of lesser known brands with large displays in this store. Overall, I think Saks brings a very upscale addition to CF Sherway Gardens, and we wish them success. They are a class act all the way.
Interesting new video showing the pending construction of the Massey Tower condominium, located on Yonge Street in downtown Toronto….
from today’s press release…..
High-rise condo market shifts to 905
GREATER TORONTO, Aug. 23 /CNW/ – The high-rise condo market in the Greater Toronto Area continues to rise high while the low-rise suburban (905) housing market remains constrained by the acute lack of product available for sale, the Building Industry & Land Development Association revealed today.
While high-rise sales in July slipped a modest 10 per cent from July 2009, sales in the January-July period were up 104 per cent with the 11,327 units sold representing the second highest total (behind only 2007 at an astounding 13,365 units) in the last 11 years.
In what may be the first signal of an emerging trend, nearly half (46 per cent) of high-rise unit sales in July were recorded in the 905 Regions of the GTA. “Toronto has consistently commanded an 80 per cent share of all high-rise sales while 80 per cent of low-rise sales have been in the suburbs. However, that balance is expected to shift as municipalities start to conform with the Greater Golden Horseshoe Growth Plan,” said BILD President and CEO Stephen Dupuis.
With continued strong sales, the high-rise price index rose exactly 10 per cent year over year, and currently sits at $430,782 compared with $391,673 last July.
Meanwhile, on the low-rise side of the equation, sales dropped 65 per cent from last July although they still remain up 8 per cent over 2009 on a January-July basis. As noted, the inventory of low-rise homes available for sale in the GTA remains near all-time lows.
“The shortage of supply of new, low-rise housing product is reflected in the fact that nearly two-thirds (64 per cent) of all new home sales in July were high-rise condos compared with the new norm of around 50 per cent,” Dupuis said, adding that the low-rise price index jumped 9.2 per cent year/year, rising from $447,950 to $489,088.
July ’10 Low Rise High Rise Total
% % %
Region 2009 2010 Change 2009 2010 Change 2009 2010 Change
Durham 238 199 -16.4% 2 1 -50.0% 240 200 -16.7%
Halton 321 47 -85.4% 35 21 -40.0% 356 68 -80.9%
Peel 453 140 -69.1% 85 328 285.9% 538 468 -13.0%
Toronto 102 40 -60.8% 1,091 658 -39.7% 1,193 698 -41.5%
York 810 252 -68.9% 145 214 47.6% 955 466 -51.2%
GTA 1,924 678 -64.8% 1,358 1,222 -10.0% 3,282 1,900 -42.1%
July 9,372 10,157 8.4% 5,543 11,327 104.3% 14,915 21,484 44.0%
Source: RealNet Canada Inc.