Canadian Housing Market Sets Record Highs in August

General Robyn McLean 15 Sep

 

The full story from Dr. Sherry Cooper, Chief Economist at DLC.
Today’s release of August housing data by the Canadian Real Estate Association (CREA) showed a blockbuster August with both sales and new listings hitting their highest levels in 40 years of data–exceeding the record July activity levels. This continues the rebound in housing that began four months ago.

National home sales rose a further 6.2% on a month-over-month (m-o-m) basis in August, raising them to another new all-time monthly record (see chart below).Unlike the previous two months in which activity was up right across the country, sales in August were up in about 60% of local markets. Gains were led by the Greater Toronto Area (GTA) and British Columbia’s Lower Mainland. With ongoing supply shortages in so many parts of Canada, it is interesting to note that the GTA and Lower Mainland also saw a considerable amount of new supply become available in August.

Actual (not seasonally adjusted) sales activity posted a 33.5% y-o-y gain in August. It was a new record for the month of August, and the sixth-highest monthly sales figure of any month on record. Transactions were up compared to last August in almost all Canadian housing markets.

So far this year, over 340,000 homes have traded hands over the Canadian MLS Systems, which was up 0.8% from the same period in 2019 despite the COVID-19 pandemic-induced recession.

“It has been a record-setting summer in many housing markets across Canada as REALTORS® and their clients play catch up following the loss of so much of the 2020 spring market,” stated Costa Poulopoulos, Chair of CREA. “Many markets dealing with inventory shortages have been seeing fierce competition among buyers this summer; although, that was something that had been anticipated for 2020 prior to COVID-19. It really does seem that the spring market shifted into the summer”.

According to Shaun Cathcart, CREA’s Senior Economist, “Activity shows signs of moderating in September”.
New ListingsThe number of newly listed homes posted a further 10.6% gain in August compared to July. New supply was up in close to three-quarters of local markets, led by gains in the Lower Mainland, GTA and Ottawa.

With the August increase in new supply outpacing the rise in sales for the first time since the rebound began in May, the national sales-to-new listings ratio eased to 69.4% in August compared to 72.3% posted in July. That said, it was still among the highest levels on record for this measure.

Based on a comparison of sales-to-new listings ratio with long-term averages, only about a third of all local markets were in balanced market territory, measured as being within one standard deviation of their long-term average. The other two-thirds of markets were above long-term norms, in many cases well above.

The number of months of inventory is another important measure of the balance between sales and the supply of listings. It represents how long it would take to liquidate current inventories at the current rate of sales activity.

There were just 2.6 months of inventory on a national basis at the end of August 2020 – the lowest reading on record for this measure. At the local market level, a number of Ontario markets are now into weeks of inventory rather than months. So supply constraints are still prevalent in many parts of the country, especially in Ontario.

Home Prices

The Aggregate Composite MLS® Home Price Index (MLS® HPI) rose by 1.7% m-o-m in August 2020 (see chart and table below). This compares to a 2.3% m-o-m jump in July 2020 – the second largest increase on record (after March 2017) going back 15 years. Of the 21 markets currently tracked by the index, m-o-m gains were posted everywhere but Victoria and elsewhere on Vancouver Island.

The non-seasonally adjusted Aggregate Composite MLS® HPI was up 9.4% on a y-o-y basis in August – the biggest gain since late 2017.The largest y-o-y gains were recorded in Ottawa (+19.9%) and Montreal (+16.4%), followed by increases in the 10% – 15% range in the GTA and surrounding Greater Golden Horseshoe markets. Moncton prices were also up in that range in August.

Prices were fairly flat on a y-o-y basis in Calgary, Edmonton and St. John’s, while climbing in the 3.5% – 5.5% range across B.C.

The MLS® HPI provides the best way to gauge price trends because averages are strongly distorted by changes in the mix of sales activity from one month to the next.

The actual (not seasonally adjusted) national average home price set another record in August 2020 at more than $586,000, up 18.5% from the same month last year.
Bottom Line

CMHC forecasted back in May that the national average sales prices will fall 9%-to-18% in 2020 and not return to yearend-2019 levels until as late as 2022. Instead, the national average sales price as of August has posted a 18.5% gain.

Housing strength is largely attributable to pent-up demand by households that have maintained their level of income during the pandemic. The hardest-hit households are low-wage earners in the accommodation, food services, and travel sectors. These are the folks that can least afford it and typically are not homeowners.

The good news is that the housing market is contributing to the recovery in economic activity.  

6 ESSENTIAL FALL MAINTENANCE TASKS

General Robyn McLean 9 Sep

Great tips for Fall home maintenance from our always helpful friends at Pillar to Post!

6 ESSENTIAL FALL MAINTENANCE TASKS
With these easy steps, your clients will enjoy the comforts of home all season long and know that they’re protecting their investment, too.
  • Caulk around exterior doors and window frames for a tight seal. Look for gaps where pipes or wiring enter the home and caulk those as well to protect from water, insects and mice.
  • Check the roof for missing or damaged shingles. Water, wind, ice and snow can cause serious damage to a vulnerable roof, leading to a greater chance of further damage inside the home. Always have a qualified professional inspect and repair the roof, but binoculars can be used to do a preliminary survey from the ground.
  • Clear gutters of leaves, sticks, and other debris. If the home gets heavy leaf fall, this may need to be done more than once during the season. If the gutters can accommodate them, leaf guards can be real time-savers and prevent clogging. Make sure downspouts direct water away from the house.
  • In cold-weather climates, drain garden hoses and store indoors to protect them from the harsh winter elements. Shut off outdoor faucets and make sure exterior pipes are drained of water.
  • Have the furnace inspected to ensure that it’s safe and in good working order. Most utility companies will provide basic, no-cost furnace inspections to their customers. Replace disposable furnace air filters or clean the permanent type according to the manufacturer’s instructions.
  • A wood-burning fireplace can be a real pleasure on a chilly fall evening. For safety, have the firebox and chimney professionally cleaned before use this season.
Pillar To Post is always committed to the health and well-being of our clients. This is especially true during this time of Covid-19 and Realtor Safety Month. We remain committed to providing the highest quality home inspection while adhering to the strict safety and cleanliness guidelines provided by the CDC and local governments.

Bank of Canada Holds Rate At 25 bps

General Robyn McLean 9 Sep

Today’s announcement and what it means from Dr. Sherry Cooper, Cjief Economist at Dominion Lending.

Bank of Canada Relies on Quantitative Easing
As promised, the Bank held its target overnight rate at the effective lower bound of 25 basis points with the clear notion that negative policy rates are not in the cards. Instead, the central bank will rely on large-scale asset purchases–quantitative easing (QE–of at least $5 billion per week of Government of Canada bonds. QE adds liquidity to the financial system and keeps market yields low. The Bank began aggressive QE with the beginning of the pandemic and will not cease until the economy has recovered, and inflation is sustainably at 2%. This could be years away, as for example, Ontario has paused reopening plans with the virus numbers ticking up. Many public health officials are expecting infections to rise with the opening of schools and the turn to colder weather. The government is preparing for a possible second wave. Policymakers, however, have dialed back language on more aggressive action.

The Bank has stated, “Both the global and Canadian economies are evolving broadly in line with the scenario in the July Monetary Policy Report (MPR), with activity bouncing back as countries lift containment measures. The Bank continues to expect this strong reopening phase to be followed by a protracted and uneven recuperation phase, which will be heavily reliant on policy support. The pace of the recovery remains highly dependent on the path of the COVID-19 pandemic and the evolution of social distancing measures required to contain its spread.”

In Canada, real GDP fell by 11.5% (39% annualized) in the second quarter, resulting in a decline of just over 13% in the first half of the year, mainly in line with the Bank’s July Monetary Policy Report (MPR) central scenario. All components of aggregate demand weakened, as expected. Global financial conditions have remained accommodative. Although prices for some commodities have firmed, oil prices remain weak.

As the economy reopens, the bounce-back in activity in the third quarter looks to be faster than anticipated in July. Economic activity has been supported by government programs to replace incomes and subsidize wages. Core funding markets are functioning well, and this has led to a decline in the use of the Bank’s short-term liquidity programs. Monetary policy is working to support household spending and business investment by making borrowing more affordable.

Housing activity has been particularly robust with substantial existing home sales in July and August. With record-low mortgage rates, buyers are satisfying their demand for more space and for moving further from city-center congestion. This urban exodus is more than anecdotal. You can get more for your money, and with many people working from home, long commutes don’t seem to be as relevant. The chart below shows that the outer suburbs of Toronto have seen the most significant increase in sales since the market picked up in early June.

Also, the construction of new homes surged to the highest level in more than a decade in August following a sharp increase in July. The greatest strength was in Toronto and Vancouver, particularly in multiple units. 

Household spending rebounded sharply over the summer, with stronger-than-expected goods consumption and housing activity. There has also been a large but uneven rebound in employment. Exports are recovering in response to strengthening foreign demand, but are still well below pre-pandemic levels. Business confidence and investment remain subdued. While recent data during the reopening phase is encouraging, the Bank continues to expect the recuperation phase to be slow and choppy as the economy copes with ongoing uncertainty and structural challenges.

CPI inflation is close to zero, with downward pressure from energy prices and travel services, and is expected to remain well below target in the near term. Measures of core inflation are between 1.3% and 1.9%, reflecting the large degree of economic slack, with the core measure most influenced by services prices showing the weakest growth.
Bottom Line

The Bank also suggested that “as the economy moves from reopening to recuperation, it will continue to require extraordinary monetary policy support. The Governing Council will hold the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2% inflation target is sustainably achieved. To reinforce this commitment and keep interest rates low across the yield curve, the Bank is continuing its large-scale asset purchase program at the current pace. This QE program will continue until the recovery is well underway and will be calibrated to provide the monetary policy stimulus needed to support the recovery and achieve the inflation objective”.

The next policy meeting will be held on October 28 when the Bank will release its new forecast in the MPR. A rate hike is unlikely this year or in 2021.

Greater Vancouver Home Sales and Listings Market Report

General Robyn McLean 3 Sep

Interesting insight on the GRVD’s most recent Home Sales & Listings Report from our friends at Dexter Realty, Vancouver.

“A tiny change today brings a dramatically different tomorrow.” Richard Bach

There seemed to be more competition in the real estate market than in the National Hockey League this August – who ever thought that would be a comparison for this time of year. If we thought competing offers were a constant in July, after a tempered start in the first half of August, we experienced two weeks with the most amount of sales reported this year after that. Amid all the chatter of economic disruption and its potential negative effects on the housing market, real estate has taken on a life of its own and clearly wants nothing to do with slowing down. And guess what? – it’s local! All the while buyers vying for various types of properties in different areas are walking away from competing offers still looking for their home. Demand side measures haven’t eased the burden for buyers in Metro Vancouver and supply continues to be an issue.

There were 3,122 properties sold of all types in Greater Vancouver in August this year compared with 3,202 sold in July, 2,256 sales in August last year and 1,961 sold in August 2018. It was actually the sixth highest amount of sales for the month of August on record in Greater Vancouver and the highest monthly sales for August since 2015. This is not just COVID pent up demand, it is a housing market that had been stalled in 2018 and 2019 coming to life. And coming to life with a significant surge as a result of homeowners looking to trade homes and many buyers simply wanting to engage after holding back.

Total sales in August were 21 per cent above the ten-year average for the month. Looking at the different types of properties, detached home sales were up 55 per cent year over year, townhouses up 51 per cent year over year, apartments up 19 per cent year over year. Detached homes made up 35 per cent of all sales, while townhomes made up 20 per cent and apartments 43 per cent. While total active listings for apartments are up 16 per cent year over year, and active listings for townhouse and detached homes are down 8 per cent and 21 per cent respectively year over year, let’s not fall into the thinking that apartments are the unwanted product. The flight from apartments broadcast by some has just happened at a quicker pace, as it has always been a part of the buying cycle. While some buyers are looking for space due to working at home or wanting less shared common space, many would have made this move eventually regardless of COVID-19. Record low interest rates and over two years of down markets with price declines in the detached market have given buyers opportunities they have been itching for. After all, it’s the ultimate home owners dream, a plot of land where you live. We shouldn’t be so surprised to see this movement right now. But with more apartments available for sale comes opportunities for first time buyers and those looking for this type of property given they have been a scarce commodity over the last few years.

Average Daily Sales and Listings in Greater Vancouver

First two weeks of March – 253 new listings, 138 sales
Last two week of March – 167 New Listings, 98 Sales
April – 120 new listings, 56 sales
May – 189 new listings, 75 sales
June – 274 new listings, 115 sales
July 6 to 10 – 302 new listings, 138 sales
July 13 to 17 – 294 new listings, 146 sales
July 20 to 24 – 258 new listings, 151 sales
July 27 to 31 – 245 new listings, 154 sales
August 4 to 7 – 337 new listings, 151 sales
August 10 to 14 – 282 new listings, 140 sales
August 17 to 21 – 298 new listings, 171 sales*
August 24 to 28 – 279 new listings, 164 sales *
*the two highest weekly sales figures in 2020 including pre-pandemic

Some highlights from August:

  • Vancouver West and Burnaby were the only areas in Greater Vancouver to see the number of sales in August higher than July

  • North Vancouver detached home sales which are traditionally low in August were higher than July and 61 per cent higher than August 2019 and 232 per cent higher than August 2018

  • In the Pitt Meadows market, there is only one-month supply of detached homes and townhomes currently

  • Bowen Island and Vancouver East detached homes have seen the biggest year-over-year increase in house prices at 11.8% and 10.1% respectively (House Price Index)

There was an increase in the number of new listings in August, which was 34 per cent higher than the ten-year average for the month of August. As a result, at the end of August there were 13,511 properties for sale, compared to 12,796 at the end of July but still less than the 14,191 available at the end of August 2019 – a 5 per cent reduction in the number of homes available year-over-year. Yes, there have been more properties listed in the last few months than we typically see at this time of year and the total number of active listings have increased, but competing offers continue – houses, townhouses and apartments. Imagine what it would be like for buyers without the number of new listings we’ve seen in the last few months. Even with more homes available for sale it is very much a seller’s market in most areas, some more extreme than others. Vancouver and surrounding cities with 4 to 5 months supply of homes available while further out there are only 3 months supply available.

So now that we’ve caught up from the summer market, it’s time for the fall market. Interest rates will fuel the real estate while they remain low, but there’s no reason to think the continued availability of listings as they continue to come to market will also fuel real estate sales. There will be further movement by homeowners looking for their “more ideal” home, changes needed as a result of additions to families and unfortunately also the break down of families. And while there have been job losses, many who have been working have decreased their discretionary spending. Vacations and dinners out could turn into more equity to invest in the next home or first home.

“People who put their home buying and selling plans on hold in the spring have been returning to the market throughout the summer. Low interest rates and limited overall supply of homes for sale are creating competition in today’s housing market,” Colette Gerber, REBGV Chair said, “Like everything else in our lives these days, the uncertainty of COVID-19 presents makes it challenging to predict what will happen this fall.”

East of Vancouver, the Fraser Valley Real Estate Board processed 2,039 sales of all property types on its Multiple Listing Service® in August, a decrease of 2.9 per cent compared to sales in July but a 57.2 per cent increase compared to the 1,297 sales in August of last year. Last month’s sales were 39 per cent above the ten-year average for August and the highest August sales in a decade. There were 3,309 new listings in August, a 6.8 per cent decrease compared to July and a 40.4 per cent increase compared to August of last year. July’s new listings were 28.9 per cent above the ten-year average for the month and the highest in the last ten years. July finished with 7,404 active listings, an increase of 0.9 per cent compared to July’s inventory and a decrease of 7.9 per cent year-over-year. “We are seeing better sales volumes increase month over month because buyers are recognizing that the Fraser Valley offers increased choice and diversified housing opportunities, while offering more value as well,” Chris Shields, President of the Fraser Valley Real Estate Board said. “In an unusual situation given the pandemic, we remain cautiously optimistic and are encouraged by the numbers we are seeing.”

5 Energy-Efficient Features that Buyers Love Right Now

General Robyn McLean 25 Aug

Learn what home seekers are after in a modern, eco-friendly home from our friends at REW

By Justin Kerby Aug 7, 2020

Sustainability has been on the mind of Canadian homebuyers for years. Now that so many people are working from home (and will be for the foreseeable future), buyer demands have shifted, and energy-efficient homes and features have become an even higher priority. If you’re spending all of your time in the house, you’ll want to be comfortable. You will also want to make sure that your utility bill isn’t breaking the bank.

New technologies and certifications hitting the Canadian market have ensured that buyers in every budget range, looking at any style of home, have the opportunity to seek out energy-efficient features. Here are five features that buyers are loving right now.

 

1. Double-pane, triple-pane, or even better, Low-E windows

A few low-tech features that buyers of all budgets are paying attention to are double-pane windows, and properly sealed doors, windows and skylights. So much heat escapes through thin windows and door gaps! It makes a noticeable difference both on the utility usage and the home’s comfort level when the home is airtight.

Focusing specifically on windows, double-pane windows are a relatively affordable way to help with insulation. Plus, in many parts of the country, triple-pane windows are becoming the norm to meet the often extreme demands of Canadian winters.

Another trend in the window game is called Low-E. These are windows with a low-emissivity coating. There are a few different types of Low-E coatings to choose from, depending on which direction the windows face and with a few other differences. This new technology is trending up with buyers today for a very good reason: it works.

When buyers are eyeing modern-style homes with a lot of windows, it’s even more appealing to have energy-efficient windows already installed. This removes the need to take on that expense as a new homeowner later on, a major bonus when energy efficiency is a priority.

 

2. Programmable and smart thermostats

The technology in smart thermostats is incredible these days. Some include geofencing features that automatically sense when you leave the home and therefore don’t need your heating or cooling systems running as much. Many are wi-fi enabled so you can control them with your smartphone, even when you’re out of the house. These smart thermostats allow homeowners detailed control over the heating and cooling systems in the house, making it easy to save energy and noticeably decrease your utility bill.

Programmable, but not smart, thermostats are also popular with buyers these days. These let you pre-schedule home, away, and vacation modes, again allowing close control of your home’s heating or cooling system. Both programmable and smart thermostats are great energy-efficient features to look for when buying a new home. If they don’t come pre-installed, you can find these thermostat styles in a variety of budget ranges anywhere from your local department store to Amazon and other e-retailers. Keep in mind your budget and the features that will actually make a difference based on your needs and lifestyle as you shop.

 

3. Appliances, but most importantly, the washer, dryer and refrigerator

The draw towards energy-efficient appliances is not necessarily new – the clout that Energy Star holds in the appliance game is huge and has been for years. But if homes aren’t 100% upgraded to energy-efficient appliances, buyers today are specifically paying attention to the washer and dryer, followed by the refrigerator, as those are the units that take the most power to run. This also appeals to buyers of all budgets. Those with lower budgets may only look at the energy efficiency of one or two appliances, whereas those with higher budgets are looking to make sure all appliances are energy efficient.

 

4. Energy Star Certified homes

Buyers who are in the market for new or newer homes are starting to look at whether the entire home is Energy Star Certified. These homes are constructed by certified Energy Star builders and are energy-efficient from the roof to the foundation. They include advanced heating and cooling systems, more and better insulation than the building code requires, airtight windows and doors, Energy Star appliances, and more. All of this combined can save homeowners up to 20% on their utility bills, making Energy Star Certified homes very appealing to many buyers in today’s market. If you’re building a new home or doing some serious renovations, you should look into this certification now and see if it’s right for you.

 

5. Net-zero energy homes

Taking it a few steps further, buyers looking at the higher end of the market are leading the trend of seeking out net-zero homes – homes that produce as much energy as they use. These have many of the same features as Energy Star Certified homes which reduce energy usage, but they also have means of producing energy. The Canadian Home Builders Association has launched a net-zero labelling program that guides and standardizes how these types of homes should be built.

According to an interview with GreenEnergyFutures, the first home certified with this labelling was built in Victoria and included solar panels, solar thermal water heating, an electric vehicle charger, ductless dryer, and more. Pairing these energy-efficient features with the stunning aesthetic of the home, it’s no surprise these homes are in higher and higher demand.

In British Columbia, there’s a goal for all new buildings (including homes) to be net-zero energy ready by 2032, meaning this is going to move from a trend to the new normal in the not-so-distant future.

While some of the energy-efficient features mentioned above may be pricey, a steady demand for them is driving prices down, making them more affordable for the average consumer. Even when compared to just a few years ago, there’s a notable difference in cost and a wider selection of price options. There is a range of low, medium and higher-end technologies, appealing to buyers with varying budgets. No matter which direction is right for you, it’s both good for the environment and your wallet to start thinking about some of these energy-efficient features as you shop for your new home.

8 DIY Home Improvements Anyone Can Do

General Robyn McLean 25 Aug

Great ideas from our friends at REW.

These low-impact upgrades are perfect for any renter or homeowner.
By Justin Kerby Aug 21, 2020

The key to falling in love with a home, whether it’s a rental or purchase, is to bring your own personal style and flair to the space. There are plenty of ways for renters to remodel without losing their security deposit, and these do it yourself projects make for great, quick updgrades to any home. Really, easy decorating options for rentals are endless once you start looking for inspiration. We’ve rounded up eight home improvement ideas, all DIY, that anybody can choose to tackle. Here’s where to get started.

1. Get crafty with cup hooks

If you can’t put holes in your walls or cabinets, command hooks are a fantastic, removable alternative. However, if your landlord does permit nails in the walls, then you can use cup hooks for a ton of great design updates.

These small and inexpensive pieces of hardware are incredibly versatile. Use them around your home to put up string lights. Screw them into the bottom of a kitchen cabinet and hang your favourite mugs. Or use them on a kitchen wall to hang utensils, colanders, pots and pans. They’re a great (and affordable) way to put your favourite items on display.

2. Upgrade your outlet and light switch covers

This home improvement project is often overlooked, but it’s one of our favourite DIY projects for several reasons. Most notably, the amount of effort it takes is next to nothing, and it can have a huge impact. Change all of the covers to a black or bronze to add a stark contrast to your white walls. Or, for even more character, go for a bright and bold pattern.

If you don’t want to buy new covers (as you’ll need to store the originals somewhere), then go for contact paper. It will be more time consuming since you’ll have to wrap each one individually, but start with one room, see what you like, and go from there. Just don’t forget to remove the contact paper or swap back to the original covers before you move out.

 

3. Change your light bulbs

This is another simple project that anyone can – and should – do. We recommend swapping out the lightbulbs in all of the rooms with energy-efficient LEDs, then customize the feel of your room for brightness and temperature. You may want a warm light in the bedroom and living room, but cool lighting in the bathroom and kitchen. This quick swap can really enhance the ambiance of your home, as well as decrease your electrical bill.

 

4. Use the space above the cabinets

Some homes don’t have bulkheads, leaving an awkward space above the kitchen cabinets. Instead of using it as a vase graveyard, you can make this a sleek extension of your cabinets. Decorate it with carefully curated décor, or add storage boxes, such as wooden milk crates for easy storage. If the space above your cabinets is quite large, add floating shelves or shelf risers to make it even more functional. This would also be a fun place to play with removable wallpaper.

 

5. Customize drawers and shelves for optimal storage

Customizing the inside of your drawers is a great way to stay organized. While you could buy some cheap, plastic containers from the dollar store, why not DIY-it? Check out these instructions for an inexpensive, home-made kitchen drawer organizer.

Also, take a look inside your cabinets. Are your shelves far apart, to the point where there’s wasted vertical space? Shelf risers are a great solution to make the cabinets in your rental unit work for you. You can purchase inexpensive risers from stores like Ikea, or make your own. Shelf risers also work great in fridges and freezers!

 

6. Disguise or transform your radiator 

If you’re renting in an older building or house, you’re likely familiar with the hot, clunky, metal radiators that we’re talking about. The good news is you don’t need to just ignore this equipment. Instead, disguise it and make it functional. For a quick fix, put a floating shelf an inch or two above the radiator, and line up some books or other trinkets. If you’re handy and have the time, build a complete radiator cover.

 

7. Make a portable garden

Many renters are lucky enough to have gardens at their homes. Some apartment buildings are even offering community garden spaces these days. But, if that isn’t the case at your rental, raised planter boxes are a great temporary garden solution – and they can even be packed up and moved when it’s time to go. If you have power tools and a workshop, YouTube has plenty of detailed tutorials for DIY raised planter boxes. If you don’t have the time, skill, or patience, most big-box hardware stores have pre-fab versions in a variety of sizes that you can paint and decorate to fit your style.

 

8. Turn your balcony into an oasis

This is a fun project that will turn any balcony or patio into an Instagram-worthy space you’ll never want to leave. First, lay down some green artificial turf to get a grassy feel. Then, string up some outdoor twinkle or cantina lights, or paper lanterns (if it’s sheltered enough from the wetter elements). Then, start decorating! If you’re in an adults-only home, set up some lounge or Muskoka chairs and a cute metal table. If you’re able to screw into the ceiling, hammocks add even more comfort. Surround your sitting space with patio-friendly plants: for a woodsy vibe, choose potted cedars, or to bring the tropics up north, go for potted banana trees. Your local garden centre will be able to set you up with the best plants for your climate, sun exposure, etc.

If you have kids, turn the balcony into a play area just for them. Add a playhouse, a slide, or a little table for tea parties. You could even add a small, raised sandbox for some extra tactile play. If you have a full yard for your kiddos, check out YouTube for cool DIY outdoor play areas.

Don’t shy away from creating a personalized, cozy home that you love spending time in just because you might be in the space temporarily. You can find so many DIY projects that will bring life and character to your home, no matter your budget, skill level, or space size. Just remember to revert back to the originals before move out day!

 

Just delayed, not dormant

General Robyn McLean 25 Aug

Some good news….and we can all use a little good news these days!…from our friends at First National.

Just delayed, not dormant

Aug 24, 2020
First National Financial LP

Canada’s real estate market made a remarkable recovery in July and there are expectations it will continue for another couple of months.

Back in the spring real estate was heading into one of the tightest markets in the past 20 years.  Then the coronavirus pandemic was declared, governments imposed lockdowns and the economy ground to a halt, hobbling home sales.  April saw some of the lowest numbers ever recorded.  But it roared back to life in July.

“Things may have gone quiet for a few months, but ultimately the market we’re seeing right now is mostly the same one we were heading into back in March,” says Shaun Cathcart, CREA’s Senior Economist.

July sales shot up more than 30% compared to a year ago and 26% compared to June.  The average price for a home in Canada hit a new record high of $571,500 — an increase of more than 14% over July of 2019.

“COVID-19 did not destroy this year’s spring market—it mostly delayed it,” says well known market watcher, economist Robert Hogue.  He notes the busy spring market is now happening during the summer, as pent-up demand is released with the reopening of the economy.

“We expect further unwinding of pent-up demand to keep sales brisk in August and perhaps September before cooling later this year,” says Hogue.

The price increase is simple supply and demand.  CREA’s sales-to-new-listing ratio tightened to 73.9% in July, up more than 10 points from June and solidly in favour of sellers.  A ratio between 40% and 60% is considered balanced.

CREA’s Cathcart expects to see demand continuing to outpace supply.

“Some purchases will no doubt be delayed, but the new-found importance of home, lack of a daily commute for many, a desire for more outdoor and personal space, room for a home office, etc. will certainly also spur activity that otherwise would not have happened in a non-COVID-19 world,” he says.

Feds seem split on mortgage policy

General Robyn McLean 17 Aug

Great insight from our friends at First National.

Feds seem split on mortgage policy

Aug 17, 2020

Buyers, brokers and lenders can be forgiven if they see the federal government’s attitude toward mortgages heading in two different directions at once.  The federal housing agency is calling for one thing while the Bank of Canada appears to be clearing the way for the opposite.

Earlier this month the CEO of Canada Mortgage and Housing Corporation, Evan Siddall, sent a letter to banks, mortgage lenders and private mortgage insurers calling on them to tighten their requirements for borrowers.  He asked lenders to stop offering higher-risk mortgages to over-leveraged first-time buyers in the name of Canada’s future economic health and for the sake of CMHC itself.

“We are approaching a level of minimum market share that we require to be able to protect the mortgage market in times of crisis,” Siddall wrote, adding that CMHC requires the support of lenders to prevent “further erosion of our market presence.”

While CMHC is calling for stricter standards the Bank of Canada has just relaxed its mortgage stress test requirements for the third time since the pandemic started.  The qualifying rate has been dropped by 15 basis points to 4.74%.  That is about $7,500.00 more purchasing power for a well-qualified, high-ratio borrower.  It is probably not enough to clear the barriers to entry, but it would certainly help with closing costs.

Canadian Housing Market Very Strong in July

General Robyn McLean 17 Aug

Housing market update from Dr. Sherry Cooper, Chief Economist at Dominion Lending.
Today’s release of July housing data by the Canadian Real Estate Association (CREA) showed a blockbuster July with both sales and new listings hitting their highest levels in 40 years of data. This continues the rebound in housing that began three months ago.

National home sales rose 26% month-over-month (m-o-m) in July, which translates to a 30.5% gain from a year ago (see chart below). July’s sales activity was the strongest for any month in history. According to Shaun Cathcart, CREA’s Senior Economist,  “A big part of what we’re seeing right now is the snapback in activity that would have otherwise happened earlier this year. Recall that before the lockdowns, we were heading into the tightest spring market in almost 20 years. Things may have gone quiet for a few months, but ultimately the market we’re seeing right now is mostly the same one we were heading into back in March. That said, there are some new factors at play as well. There are listings that will come to the market because of COVID-19, but many properties are also not being listed right now due to the virus, as evidenced by inventories that are currently at a 16-year low. Some purchases will no doubt be delayed, but the new-found importance of home, lack of a daily commute for many, a desire for more outdoor and personal space, room for a home office, etc. will certainly also spur activity that otherwise would not have happened in a non-COVID-19 world.”

For the third month in a row, transactions were up on a month-over-month basis across the country. Among Canada’s largest markets, sales rose by 49.5% in the Greater Toronto Area (GTA), 43.9% in Greater Vancouver, 39.1% in Montreal, 36.6% in the Fraser Valley, 31.8% in Hamilton-Burlington, 28.7% in Ottawa, 16.9% in London and St. Thomas, 15.7% in Calgary, 12.1% in Winnipeg, 9.7% in Edmonton and 5.4% in Quebec City.
New ListingsThe number of newly listed homes climbed by another 7.6% in July compared to June, to a level of 71,879–the highest level for any July in history. New supply was only up in about 60% of local markets, as the rebound in supply appears to be tapering off in many parts of the country. The national increase in July was dominated by gains in the GTA. More supply is expected to come on the market in future months, particularly once a vaccine is widely available.

With the ongoing rebound in sales activity now far outpacing the recovery in new supply, the national sales-to-new listings ratio tightened to 73.9% in July compared to 63.1% posted in June. It was one of the highest levels on record for this measure, behind just a few months back in late 2001 and early 2002.

Based on a comparison of sales-to-new listings ratios with long-term averages, only about a third of all local markets were in balanced market territory, measured as being within one standard deviation of their long-term average, in July 2020. The other two-thirds of markets were all above long-term norms, in many cases well above.

The number of months of inventory is another important measure of the balance between sales and the supply of listings. It represents how long it would take to liquidate current inventories at the current rate of sales activity.

Housing markets are very tight, especially in Ontario, as demand has far outpaced supply. There were just 2.8 months of inventory on a national basis at the end of July 2020 – the lowest reading on record for this measure. At the local market level, a number of Ontario markets shifted from months of inventory to weeks of inventory in July.

Home Prices

The Aggregate Composite MLS® Home Price Index (MLS® HPI) jumped by 2.3% m-o-m in July 2020 – the second largest increase on record (after March 2017) going back 15 years. (see Table below). Of the 20 markets currently tracked by the index, they all posted m-o-m increases in July.The biggest m-o-m gains, in the range of 3%, were recorded in the GTA outside of the city of Toronto, Guelph, Ottawa and Montreal; although, generally speaking, most markets east of Saskatchewan are seeing prices accelerate in line with strong sales numbers. Price gains were more modestly positive in B.C. and Alberta.

The non-seasonally adjusted Aggregate Composite MLS® HPI was up 7.4% on a y-o-y basis in July the biggest gain since late 2017.

The MLS® HPI provides the best way to gauge price trends because averages are strongly distorted by changes in the mix of sales activity from one month to the next.

The actual (not seasonally adjusted) national average price for homes sold in July 2020 was a record $571,500, up 14.3% from the same month last year.

The national average price is heavily influenced by sales in the Greater Vancouver and the GTA, two of Canada’s most active and expensive housing markets. Excluding these two markets from calculations cuts around $117,000 from the national average price. The extent to which sales continue to fluctuate in these two markets relative to others could have further compositional effects on the national average price, both up and down.
Bottom Line

CMHC has recently forecast that national average sales prices will fall 9%-to-18% in 2020 and not return to yearend-2019 levels until as late as 2022. I continue to believe that this forecast is overly pessimistic. Here we are in the second half of 2020, and the national average sales price has risen 14.3% year-over-year.

The good news is that the housing market is contributing to the recovery in economic activity. While the course of the virus is uncertain, Canada’s government has handled the COVID-19 situation very well from both a public health and a fiscal and monetary perspective. The future course of the economy here will depend on the virus. While no one knows what that will be, suffice it to say that Canada’s economy is en route to a full recovery, but it may well be a long and bumpy one.

 

6 Simple Remodel Ideas For Renters (That Won’t Cost You Your Security Deposit)

General Robyn McLean 15 Aug

Some great tips from our friends at REW.

Need to freshen up your rental home? Follow these easy ideas.
By Justin Kerby Aug 13, 2020

There are so many ways renters can remodel and redecorate their homes. It’s all about showing off your personal style in ways that can be reverted back before move out day (without risking your security deposit).

Before you start planning any major renovations, there are a few questions you should ask your landlord regarding what you are and are not allowed to do. Keep in mind that some landlords are much stricter than others.

Here, we’ve listed some of our favourite ways to remodel and update rental spaces, covering a range of completion times and budgets. These rental renovation ideas are temporary and easily reversible, suitable for nearly any rental unit.

 

Use temporary wallpaper & contact paper to brighten up any room

You can make a huge impact in rentals of any size by making removable wallpaper and contact paper your best friend. These two home décor items are similar – a vinyl front and adhesive backing that sticks to surfaces and can be removed with heat – but with slightly different functions.

Removable wallpaper tends to be more adhesive and durable, so it’s better suited for creating an accent wall or to change the colour of an entire room. Contact paper is great for lining drawers, shelves, the back of cabinets, fridges and other appliances. If you have the time (and patience), try covering your entire kitchen counter with a sleek marble-like design to really change up the look of your home.

You can find removable wallpaper at many hardware stores and online retailers. Contact paper is even more abundant, with some dollar and discount stores carrying a variety of styles. Don’t be afraid to change things up, wallpaper is officially back in style.

 

Glam up your kitchen with peel-and-stick backsplash

Next up in the peel-and-stick rental renovation category is the kitchen backsplash. You can find beautiful vinyl backsplashes that look like classic subway or vintage tiles, marble, and more at stores such as Home Depot, Rona, or online at Amazon and Etsy.

These types of tiles can be used in both kitchens and bathrooms, and removal is as easy as it gets. For most products, all it takes is applying some heat with a hairdryer for a no-fuss removal. No matter which style of tile you choose, this simple upgrade will provide sophistication to even the blandest of kitchens, and it can be completed in an afternoon.

 

Add style and function with tension rods

Tension rods are a dream for renters. You can find them online and in most hardware stores in a variety of sizes and finishes, and they can be used in so many ways (without ever leaving a mark on your walls). Plus, they tend to be inexpensive and easy to install.

Use tension rods to hang soft, breezy drapes over a drab window. Put them up in your bathroom to hang a decorative cloth shower curtain and cover up an unsightly tub. Add them to a closet to increase functionality and storage space. You can even get creative with corner-specific tension rods and create a closet! Try leaving the rod bare and hang dresses or coats, or add a curtain to hide storage bins or your vacuum. You’ll find the versatility of these affordable and functional pieces extremely valuable.

 

Create a new room or storage area with furniture

If you have a slightly higher budget for your rental remodel, you can get creative with a few pieces of furniture and change up your layout.

Tuck cleaning supplies in a corner and surround them with a fold-away room divider, and voila! You have another closet. If you’re tired of your open concept layout, use a large bookcase to divide your living and dining areas. These both also give you the option of rearranging your furniture again down the road, so you can regularly freshen up and optimize the space.

 

Swap out hardware to add instant character to your most-used rooms

A quick and easy way to spruce up your kitchen or bathroom is by replacing the cabinet and drawer hardware, with two caveats. First, make sure you keep the old hardware so you can replace it before you move out. Second, make sure your new hardware uses the same holes, so there’s no drilling required.

With that out of the way, you can find the perfect knobs and pulls that suit your style. If you’re renovating on a budget, look at thrift stores or the Habitat for Humanity ReStore for great deals and unique pieces. Just a simple swap from plastic hardware to metal or ceramic instantly adds character to your rental.

 

Remove cabinet and closet doors to get a modern, open and airy feel

This remodelling idea might be a bit more controversial than the rest, so depending on how strict your landlord is, it’s likely worth asking before making any changes. However, removing certain doors and cabinets can really add some life to a rental space.

If you don’t love your kitchen cupboards, remove the doors from the top cabinets, and add a bright contact paper to the inside shelves and back wall. This will give you a trendy, open-shelf space. To test things out, try this with just one or two cupboards instead of the entire kitchen to start. We recommend leaving the lower cabinets in-tact since they’re largely out of the sightline in most spaces.

You can try this same idea with other areas of your unit, such as closets or a pantry, depending on how much open shelving you want to see. No matter what you do, just be sure to store any removed doors in a very safe and secure area, as they can be very expensive to replace.

Whether you want to make a small space feel bigger or you’re simply tired of the standard beige walls surrounding you, there are many ways to remodel and decorate your rental space to make it feel cozy, inspiring and inviting, without risking your security deposit. All you need is a little bit of creativity and a few tools to make a space truly your own.

By Justin Kerby Aug 13, 2020

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