Month: July 2019

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11 Jul

Canadian housing starts surge 25% on coast-to-coast increase

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Posted by: Frederic Pichette

Chris FournierBloomberg News

Canadian housing starts surged to the highest level in more than a year in June, led by construction of multiple-family dwellings such as condos and row houses.

In another sign of recovery for the nation’s real estate market, builders started work on an annualized 245,657 units last month, a jump of 25 per cent from May, Canada Mortgage and Housing Corp. said Tuesday — easily topping the median forecast of 208,600 units in a Bloomberg survey. Multiple unit starts rose 31 per cent on the month to 189,200, CMHC said.

Gains were “evenly spread out across the country,” Jocelyn Paquet, an economist at National Bank Financial in Montreal, wrote in a note to clients, adding all 10 provinces registered increases, something that hasn’t happened since 1996.

The report is in line with other recent data that suggests the nation’s housing sector is stabilizing from a recent slump, easing concern that more expensive markets like Toronto and Vancouver were poised for a major correction. On a quarterly basis, starts rose 20 per cent in the April to June period, rebounding from a 14 per cent decline in the first three months of 2019, meaning residential construction should provide a positive contribution to second-quarter growth, Paquet said.


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The increase in national housing starts was “primarily due to higher trending row and apartment starts in urban areas,“ Bob Dugan, CMHC’s chief economist, said in a statement. Home building was 36 per cent higher in Ontario, and up 12 per cent each in British Columbia and Quebec, the agency reported. It surged 43 per cent in Alberta.

“Robust population growth, strong labour markets, and past gains in pre-construction sales” are supporting starts, according to Rishi Sondhi, an economist at Toronto-Dominion Bank. He said, however, that starts are moving gradually lower on a “trend basis,” with the 6-month average well down from its late 2017 peak.

“We anticipate some further moderation, as starts move closer to a more fundamentally supported level of around 200k,” Sondhi said in a note.

In a separate release Tuesday, Statistics Canada reported residential building permits fell 17 per cent in May. More housing data is in the offing, with Statistics Canada’s New Housing Price Index for May out Thursday and Canadian Real Estate Association data on existing home sales due Monday.

–With assistance from Chris Middleton.

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3 Jul

No more renters’ paradise: low vacancy rate and hot real estate market mean higher rent

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Posted by: Frederic Pichette

Denise Roberts, CTV Montreal
Published Saturday, June 29, 2019 6:14PM EDT 
Last Updated Saturday, June 29, 2019 6:23PM EDT

Despite being known for years as a renter’s paradise, Montreal’s housing costs are shooting up and tenants’ rights advocates are warning that’s hurting the city’s most vulnerable people.

As some Montrealers got ready to switch digs on the annual July 1 Moving Day, not all were happy about their new housing situations. Justin Thomas said a dispute with his landlord over Airbnb rentals made it impossible to stay, but finding a new place was also hard.

“We were very lucky that we found a place,” he said. “I was scouring Kijiji and the hour it was posted I responded… We’re going to be paying more than we were paying here. The options in our price range are a lot less.”

Montreal’s vacancy rate is just 1.9 per cent, the lowest in 20 years. Tenants’ rights activist Maxime Roy-Allard said without rent control, landlords are at liberty to raise rent.

“If you’re looking for a place this year, if you want a two-bedroom apartment in Montreal, you have to pay $1,200 and $1,300,” he said. “Not $800 like official numbers are saying.”

Roy-Allard said many low-income families are being priced out of the market and called on the government to step in.

“It’s very hard for low-income tenants because there’s not enough social housing,” he said.

But Hans Brouillette, spokesperson for the Real Estate Owners Corporation of Quebec, said rent increases are due to many factors.

“Taxes increase, the cost of maintenance, renovations, insurance premiums and management… It’s very difficult to have rents as we did have several years ago,” he said.

Brouillette said that the cost of becoming a landlord has also gone up, with the recent boom in Montreal’s real estate market. That means that the renters’ paradise days are over.

“It’s going to change,” he said. “Because as we see with the vacancy rate that’s under two per cent and probably at one per cent in the coming years, things will change. It’s going to be very difficult for tenants.”