The Weekly 411

TLDR:

📈 Canada's Top 5 Real Estate Markets in 2023

📉 Rental Market in Canada Faces Lowest Vacancy Since 1988

🏘 Leon’s Furniture to build 4,000 homes 

😩 Condo Towers and Developments in Receivership

🧐 2013-2023: A Decade of Home Price Changes

📈 Canada's Top 5 Real Estate Markets in 2023

• Mauricie, Que. - Benchmark home price: $264,400, up 17.3%. Factors include high population growth and relatively low prices.

• Sudbury, Ont. - Benchmark home price: $437,900, up 15.1%. Influenced by investor interest, demand from first-time homebuyers, but with a slowdown in new construction.

• Greater Moncton, N.B. - Benchmark home price: $350,700, up 12.6%. Increased due to affordability compared to larger urban centers.

• Bancroft, Ont. - Benchmark home price: $551,900, up 12.5%. Despite predictions of a housing correction, prices increased.

• Calgary - Benchmark home price: $568,000, up 10.5%. Driven by migration and tight housing conditions.

📉 Rental Market in Canada Faces Lowest Vacancy Since 1988

• The rental market in Canada is experiencing the lowest recorded vacancy rate since 1988.

• The nationwide vacancy rate is 1.5%, contributing to a decline in rental affordability and less tenant mobility.

• The condo rental market has an even lower vacancy rate of 0.9%.

• Demand is outpacing supply, causing the average rent for a two-bedroom apartment to increase by 8%.

Why This Matters: Increased immigration, employment growth, and low affordability in homeownership are driving the demand and prices for rental housing. Rental turnover, where units are occupied at higher rents compared to previous tenants, is a major contributor to rent increases.

🏘 Leon’s Furniture Ltd to build 4,000 homes 

• The company has rezoned a 16.2-hectare area, previously for employment use, for housing development.

• The proposed development features townhouses, mid-rise and high-rise buildings, along with community spaces.

• Plans include developing a master-planned community with diverse residential structures.

• Following the announcement, Leon’s shares rose almost 6% on the Toronto Stock Exchange.

😩 Condo Towers and Developments in Receivership

• Several real estate projects across Canada, including condominium towers and tracts of land, are entering receivership.

• Experts predict at least another six months of increasing receivership appointments.

Notable Projects in Receivership:

• The One, an 84-story building in Toronto, has faced receivership, with court documents revealing $1.7 billion in debt.

• Creditors of a planned 55-story condo tower in downtown Vancouver are seeking repayment of over $82 million in loans

• A Mizrahi Inc. condo project at 128 Hazelton Ave in Toronto has a $16-million loan outstanding.

• Multiple projects by Vandyke Properties in the GTA, covering over 1,700 units, face receivership with debts exceeding $200 million

Why This Matters: Smaller developers are finding it harder to secure funding as second-tier lenders become more cautious. High-rise developments are particularly affected due to their complexities and potential for delays.

Buyers must remain cautious when purchasing pre-construction properties from less reputable developers. 

🧐 Here's How Home Prices Grew in the Past 10 Years (2013-2023)

• The national benchmark witnessed an 86.8% price increase from $417,100 in 2013 to $779,100 in 2023

Here is how each region performed

• London & St. Thomas had the highest price growth, with the benchmark single-family home price rising by 178% from $221,800 in 2013 to $616,700 in 2023.

• Niagara Region and Kitchener-Waterloo also witnessed substantial price increases of 174% and 159% respectively.

• Guelph single-family homes had the largest price increase in Ontario over the past ten years, rising by $516,700.

• Greater Toronto Area (GTA) saw the benchmark price of a single-family home rise by $685,500 to reach $1,273,300 in 2023.

• Regina, St. John’s, Edmonton, and Saskatoon remained stable with price increases below 20%.

• Greater Vancouver experienced an 84.5% increase in price over a decade, slightly below the national average of an 86.8% increase

• Quebec CMA, Calgary, and Winnipeg had a 10-year change in price lower than the national benchmark.