Housing affordability eroding, RBC says

The Canadian Press Posted: Nov 27, 2013 8:50 AM ET 

The Royal Bank says higher prices and an increase in mortgage rates have made home ownership less affordable for the average Canadian family.

RBC's latest research on the proportion of average household income needed to maintain a home — mortgage payments, utilities and municipal taxes — increased over the summer for a second consecutive quarter.

The level of deterioration differs from region to region and on the type of home, but RBC says that for the average bungalow the affordability measure rose to 43.3 per cent of a family's pre-tax income — up seven-tenths of a percentage point.

The bank says on two-storey homes, the affordability reading rose 0.6 of a percentage point to 48.9 per cent, and condos remained the most affordable by far with at 28 per cent of pre-tax income.

But city affordability issues were the worst in Vancouver, where it would take 84.2 per cent of an average household's pre-tax income to maintain a home.

That compared with a still high affordability measure of 55.6 per cent in Toronto.

Elsewhere, affordability scales that were closer to historic norms, with Montreal at 38.3 per cent; Ottawa at 37.3, Calgary at 33.7 and Edmonton at 32.9 per cent of household pre-tax income.

Calgary leads country in new home price increase. Highest annual hike since July 2007

                                                                                                                                                                    By Mario Toneguzzi, Calgary Herald November 14, 2013

CALGARY - Calgary led the country in September with the highest increase year-over-year in new home prices.

The New Housing Price Index, released Thursday by Statistics Canada, said prices in the Calgary area were up 6.3 per cent from a year ago, which represented the highest annual hike since July 2007.
Nationally, prices rose 1.6 per cent.
On a monthly basis, prices rose by 0.5 per cent in Calgary from August while they were flat across the country.

“The largest monthly price increase in September occurred in Calgary . . . where builders reported that rising material and labour costs as well as higher land development costs contributed to the price gain. New home prices in Calgary have been increasing since December 2011,” said the federal agency.

The Alberta Condo Owners Association (ACOA)

Did you know Calgary had more than 600 active condo listings in November alone?

Condos are a vital part of the residential housing market in Alberta, and now you can help give them a stronger voice.

The Alberta Condo Owners Association (ACOA) is seeking new members to help condo owners join together with a focused voice and a visible presence that is acknowledged by industry and service providers.

Established in August, the ACOA is working toward its vision of condo owners experiencing a fair and equitable, financially responsible and peaceful condominium lifestyle.

You can support the ACOA by signing up for an annual membership for $20 per year. An ACOA membership is also a great holiday gift idea for clients or friends. ACOA will keep members informed of all major initiatives they undertake.  One example is the Alberta Condominium Property Act revision process, which has legitimate implications that can affect property values, condo lifestyle and overall financial investment for property owners.

The ACOA also distributes a monthly newsletter that provides condo owners and members with helpful information and education, articles on condo living and ideas about how to live the “dream condo life.”

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Calgary's hot market challenging for 1st-time home buyers

                                                                                                         CBC News Posted: Nov 14, 2013 9:14 PM MT
Buying a home in Calgary is expensive and there are growing concerns that the hot market is leaving some people behind.

"It's been a long road," said Nicole Imeson, who is buying her first home. "I have been doing research and saving for my down payment over the last year fairly aggressively." "It's pretty difficult.... I was putting 25 to 30 per cent of my income away every month and I was able to save up in about two years."

A five per cent down payment on the average Calgary house is more than $25,000.
"I don't see any issue getting a good return on my investment, so at that point I was OK with the higher price tag, knowing that I would eventually get that back," said Imeson.
Imeson's realtor says, with incomes in some sectors on the rise, many people in Calgary still manage to buy but not everyone can.

"I do have clients that are quite successful in life, self employed, driving brand new vehicles, and go to talk to their mortgage broker and find out they only qualify for about $160,000," said Raena Gartner. "And so they're looking at maybe Airdrie or Cochrane for a nice condo in that price range."

David Watson, who heads Attainable Homes Calgary — a city program that helps people with down payment, says saving that money is often the biggest barrier.

Average home costs $517K

"They're going to have to rent. Or they're not going to come to Calgary," he said. "Or they're going to come to Calgary and make some money and go back to where they came from."
Watson says the issue is only getting worse, especially because the rental market is also sizzling.
"The gap between housing prices and income was widening and widening — making it harder for people that had real jobs to actually get ownership in Calgary," he said. "We certainly have noticed just in the last six months of this year that that has got even larger."

This year, the average home in Calgary sold for more than $517,000. An average townhouse costs $341,000 and an apartment-style condo costs nearly $300,000 on average.
Watson says home ownership in the city may be out of reach for Calgarians with moderate incomes.

"You end up seeing larger cities that are based with very rich people at the top and very poor people at the bottom, and the people that make the city run can't afford to live there," he said.
With economic forecasts showing no signs of the housing market slowing down, many more people may find themselves priced out of home ownership.

Calgary region housing starts forecast to rise in 2014

                                                                                                           By Mario Toneguzzi, Calgary Herald October 31, 2013

Total housing starts in the Calgary region are forecast to fall this year by 8.9 per cent before rising by 12 per cent in 2014.

The Calgary Housing Market Outlook, released Thursday by Canada Mortgage and Housing Corp., said starts will dip to 11,700 units in 2013 before increasing to 13,100 in 2014.

“Following a nine per cent reduction in 2013, total housing starts in 2014 are forecast to rebound with gains in both single-detached and multi-family construction,” said Richard Cho, senior market analyst in Calgary for the CMHC. “Continued job creation and heightened net migration throughout the forecast period will contribute to the demand for new homes.”

Single-detached starts in 2013 are on pace to reach 6,200 units, up four per cent from 5,961 units in 2012. “New home buyers are capitalizing on low mortgage rates and increased equity gains towards their next home purchase. In addition, new home inventories remain relatively low, creating opportunities for more units to be started,” said Cho.

In 2014, single-detached starts are forecast to increase five per cent to 6,500 units.
Multi-family starts are projected to decline 20 per cent to 5,500 units in 2013, mainly due to a decrease in apartment construction. But, an increase is expected in 2014. Rising house prices will have some buyers looking to the multi-family market where prices on average are lower, while others will be buying for lifestyle reasons, said the CMHC.

Meanwhile, with rental vacancies expected to remain low and rents increasing, demand for multi-family units from renters and investors will also increase. These factors are expected to push up multi-family starts by 20 per cent in 2014, reaching 6,600 units, it said.

By the end of 2013, existing home sales in Calgary are forecast to reach 29,200 units, up 10 per cent from 26,634 in 2012. In 2014, job creation and net migration will continue to be key drivers of the resale market, said the report. Employment growth in 2014 will remain strong for the fourth consecutive year, while migration will be coming off a record high in 2013. MLS residential sales are forecast to increase 2.7 per cent in 2014 to 30,000 units.

The average MLS residential price in Calgary is forecast to finish at $436,500 in 2013, up 5.9 per cent from $412,315 in 2012. Price growth should moderate to 2.4 per cent in 2014, with an average price of $447,000.

Ring road deal may be a boon for Calgary real estate

                                                                                                                                                               By mario toneguzzi, Calgary Herald October 31, 2013

CALGARY - The new southwest portion of the ring road is expected to be a boon for residential real estate near the proposed roadway.

“Transportation accessibility is key to location — which is everything in real estate. And the Ring Road is all about transportation accessibility: access to downtown, other parts of Calgary, the mountains,” said Scott Bollinger, broker for the ComFree Commensense Network.

“Recent studies in Edmonton and California show us we should expect housing and property values around the ring road to increase. The interesting thing about the Calgary example is that much of the adjacent property is already developed and has been constrained by limited infrastructure and access for many years. That means that, unlike other major freeway projects, most of the gains in property value in Calgary’s example may be felt by individual homeowners as opposed to developers.”

He said the studies show that prices may increase but not until well into the project’s construction or even completion.

“My gut tells me that southwest Calgary might be different,” said Bollinger. “This project has been in the planning stage for decades and will now impact established communities. The increases in value may be priced into the market sooner than we’ve seen in other examples.

“Why do property values increase? A lot of it comes down to commute times and accessibility to recreation areas, shopping options and job centres. We’re measuring these times not in miles or kilometres now, but in minutes. And when you can cut the minutes it takes to drive to a favourite restaurant, or a hockey arena in the northwest, or Sunshine Village on the weekend, that time saved is reflected in the price you’re willing to pay for a property.”

But it’s not just existing residential communities that will benefit, said Bollinger, adding that a significant amount of land on the extreme southwest edge of Calgary sits undeveloped, under-utilized and likely undervalued.

“This deal has the potential to double or triple land prices in that area and we are already beginning to see a rise in activity as developers and speculators gain confidence that the area will eventually be accessible by the Ring Road,” he said.

The Calgary Transportation Effect report, released this year by the Real Estate Investment Network, said overall transportation improvements in the city will deliver a 10-20 per cent enhancement of real estate values in the regions most affected. In the future, these areas will outperform the rest. If the market goes up everywhere, these areas will increase by about 10-20 per cent more. If the values drop, these will drop by 10-20 per cent less, said the report.

Don Campbell, senior analyst with the Real Estate Investment Network, said transportation arteries become increasingly critical in a city growing as quickly as Calgary.

“When the arteries become clogged, the flow of goods and people not only slow down but so does the economic growth. In today’s economy, distance is measured in minutes, not kilometres,” he said.

“The completion of the first three-quarters of the Calgary Ring Road is already having a positive effect on the repositioning of office, retail and commercial space. No longer is it simply a consolidation into the downtown core. The City of Calgary, its citizens and its businesses now have more and quite frankly more strategic options for location. We are already witnessing this especially in the north and southeast quadrants where full live/work communities are forming thus taking pressure off older transportation arteries.”

2013年十月份房地产市场统计

价格的上扬刺激了新挂量的增加

 

Calgary, 十一月一日 2013 – 民宅本月共成交1,953 套，比去年同期涨幅18%。自年初至今，成交量涨幅为10%。

然而，从年初至今整个城市的交易量远低于2005-2007年的水平。大家应该已经注意到了很多房屋成交的价格高于挂牌价格，并且成交的很快。尽管我们看到很多乐观的迹象，但是始终不是2006年的翻版。

今年从年初至今，民宅成交前在市场上的天数为37天，却比去年同期低了16%（大约多出6天），比2006年的平均在市场上20天的天数多了不好啊！另外，成交价/挂牌价的比率虽然有涨幅，但是仍然比7年前的水平低一些。

十月份整个城市新上市挂牌量为2,522套，比去年同期增加9%，但是仍不足以带动整个库存房源的涨幅。不过，过去的四个月份和2012年相比，新挂牌量仍然是增长的。

价格增长，以及日渐紧缩的市场条件共同促使新挂牌量增加，从而缓解了紧缩的市场状况。尽管市场有所改善，但仍然是卖方市场。

历经了前十个月份，独立屋共售出14,340套，比2012年涨7%。超过预期的成交量的增长 ，主要源于新挂量的增加，而上半年的新挂牌量涨幅太有限了

从年初至今，共管公寓apartments共售出3,482单元，排屋townhouses共售出2,774单元。毕竟公寓市场仅占整个市场的一部分，从年初至今成交量涨幅为18%。

市场基准价和去年同期、以及上个月相比都没有变动。独立屋市场基准价为$468,000, 共管公寓apartments 和排屋townhouses分别为$276,100、$302,200 。

共管公寓apartments价格上涨得速度比独立屋快多了，不过价格仍然峰值时期7%。但是，独立屋的价格却高于前次的峰值了。（告诉我们什么呢，公寓如果还没解套的，还可以继续等待。投资，现在买公寓还来得及。）独立屋、排屋价格涨幅为8%，而共管公寓涨幅为11%。

就业率的上涨、新移民的强势增加、租赁房屋的稀缺，加上低贷款利率共同促使了过去两年来消费者对房屋需求的增加。同时，供给却跟不上，所以导致价格上扬。

尽管短期我们仍然预期价格往上走，但并不是2006年的翻版。因为经济形势是两码事了。