Home sales in Greater Vancouver are on a hot streak, and the professional association representing all the real estate boards in the province is bumping up its forecast for 2016, predicting escalating prices and a jump in the number of homes sold.

The British Columbia Real Estate Association forecasts unit sales in the Greater Vancouver region will increase 8.9% in 2016, from 43,145 homes sold in 2015 to 47,000 this year.

For B.C. as a whole, unit sales are forecast to increase 12.3% to 115,200 units, breaking the previous record of 106,310 units sold in 2005.

“Robust employment growth and a marked increase in migration from other provinces is buoying consumer confidence and housing demand in most regions of the province,” said BCREA chief economist Cameron Muir.

“Record housing demand has depleted inventories in many urban areas, and the resulting imbalance between supply and demand has pushed home prices considerably higher.”

The average sales price for homes in Greater Vancouver is expected to reach $1.125 million this year, up 24.6% from $902,801 in 2015. Across the province, the average price is forecast to increase 20.4% this year, from $636,600 last year to $766,600 in 2016.

This latest forecast is in sharp contrast to the BCREA’s previous release, in which it had predicted an 8.2% drop in unit sales across Greater Vancouver and a 6.2% decline across the province as a whole.

The BCREA had previously said home sales would fall because of a lack of supply. It now says a jump in new home construction is set to help meet demand.

“Waning inventories of newly completed and unoccupied units are being offset by a market increase in the number of homes under construction,” the BCREA said in a news release.

“Total housing starts in the province are forecast to climb 20% to 37,800 units this year, before edging back to 34,200 units in 2017.”

Source: Emma Crawford Hampel, Business in Vancouver
https://www.biv.com/article/2016/6/greater-vancouver-home-sales-and-prices-soar-2016-/

There are two main options when buying a home: Either you buy new – a completely new build – or you buy used.

If you’re buying a new home, make sure you check out the builder, their track record and speak to people who have bought their home from the same builder.

Were they happy with their new home? Did they have any problems within the first year? Second year? What types of problems were they? Did they require major fixes, like a leaking basement, a problem with the HVAC or electrical issues? How helpful was the builder when it came to fixing the problem?

Just because a house is new doesn’t mean it won’t have issues. I’ve seen brand new homes, not even five years old, with major fixes that nearly bankrupt the homeowner. A new home shouldn’t have major problems, but too many times it does.

If you’re looking at used homes, be careful with ones that were flipped. These homes are especially a problem because they are deliberately made to look good, but aren’t necessarily built or renovated to be good. They take advantage of homebuyers’ lack of knowledge when it comes to picking out shoddy workmanship.

Looks are deceiving. A home that’s been flipped banks on it.

I don’t like flips because most of them are done with one purpose: To make a profit. In most cases, the homeowners don’t care about quality because they won’t be living there. Their top priority is to sell fast to save on mortgage payments. And once it’s sold, any problems in the home become the responsibility of the new owners.

How do you know if it’s a flip? There are some warning signs, but again, it comes down to doing your homework. Most people think you need to be a pro to pick out the warning signs, but a lot of it is just common sense.

For example, if the homeowner tells you that they just finished renovating the kitchen and bathroom, how much do you want to bet that they had enough money to do both renovations right?

A standard kitchen renovation done properly will cost at least $30,000. A bathroom reno can cost close to $20,000. If the only reason for renovating was to sell, I would be cautious on how the work was done. Good work takes time, and it isn’t cheap. Ask the homeowner details about the reno, such as how long it took to find the right contractor, set up the job, choose materials and for the work to be done. If all it took was a few weeks, I would be cautious.

If a home looks like it’s been renovated, do a search for any permits on work completed. If changes were made to the plumbing, electrical or structure, permits needed to be pulled.

Also look for cheap materials, such as MDF for cabinetry or laminate flooring. Keep an eye out for bad trim and sloppy paint jobs — these are red flags for quick and cheap renos. When the trim is off or doesn’t line up, you can bet that the workmanship isn’t top quality. If they fumbled on the finishes, they probably cut corners on the stuff they know most buyers will not see — the stuff behind walls and below flooring.

If windows were replaced, check to make sure that they are at least Energy Star rated. If the home has bad windows, you will pay for them for years in extra energy costs. And the cost of replacing them will run you at least $10,000. So if they need replacing, as a buyer, you need to know.

One last thing home buyers can look into is getting a home-history report on a property. Some home inspectors even include this service as part of their basic home inspection. A home-history report uses municipal, provincial and federal data to gather the most up-to-date property information. It’s an extra tool that helps protect a home buyer, so you know exactly what you’re walking into.

A home-history report can tell you the home’s previous sales price, sale dates, building permit information, information on structure or any previous insurance claims related to the property. You should know if a home you’re looking at had major water damage, flooding, a fire or damage from a natural disaster. Some home-history reports can even tell you if a house was ever used for illicit purposes, like a grow-op or meth lab.

The more information you have on a property, the better. You will know if the electrical or plumbing needs to be looked at by a professional to make sure it’s safe, or if the structure of the home has been modified or undermined. It puts you in a better position to buy the right home and buy it smart.

Source: Mike Holmes, Postmedia News

Unlike a lot of first-time home buyers, in 2009 Jesse MacNevin decided to go for a house that was less than the amount he was approved for.

“I started doing the numbers and talked to a few real estate agents,” he says. “Then I went to my credit union for a pre-approval. I realized then that I needed to focus more on what I could actually afford versus how much they would give me.”

While he was given the green light to aim for a $350,000 home, he settled on a condo for just under $260,000 instead. “I didn’t want home ownership at the expense of everything else. I remember looking at my budget at the time and thinking the last thing I wanted was not to be able to travel. It wasn’t exactly what I wanted, but it was cheaper and fulfilled all my needs. In hindsight, it was a good move.”

MacNevin says having a good real estate agent and lawyer helped him determine what he could really afford, where there might be potential problems and the ins and outs of closing the deal. A mortgage broker was also important when it came to the signing process and making sure there was flexibility in his mortgage terms.

Not everyone entering the home buying market is so diligent.

When doing the mortgage math, it’s not enough to plug some numbers into an online estimator, says David Stafford, managing director, real estate secured lending, for Scotiabank in Toronto. “This is probably the largest single financial transaction that most people do in their lives, and it can get very complicated. Online estimators typically won’t give you the full picture.”

He says buyers need to look beyond the actual purchase price and factor in a percentage (typically 1.5 per cent of the purchase price) for closing expenses from the outset. “Land transfer taxes, legal fees, title insurance and other things are all part of the math.” They also need to consider ongoing expenses that will be over and above monthly mortgage payments, such as utilities, property taxes, insurance, maintenance and condo fees.

Sometimes there are additional surprises that come into play in the initial stages of home ownership, such as reimbursement fees if the former owner has prepaid their property taxes and moving costs, says Toronto-based Richard Desrocher, a general legal practitioner and former real estate broker.

The immediate financial aspects are only part of the process, which is why a home inspection is a good idea, he says. “You won’t know what’s going on behind the walls and on the roof. It’s pretty scary after you close a deal to have to deal with drain problems.”

There are also ways people can reduce their costs if they talk to the right people, Desrocher says. “A lot don’t realize that many financial institutions are willing to negotiate down from their published rates. A mortgage broker is much better informed about where the best deals are and can shop the market for you.”

Source: Denise Deveau, Postmedia News

Canadian cities, led by Vancouver, dominate North America’s Top Five list for quality of life, according to a survey issued by global business consultant Mercer.

Ottawa, Toronto and Montreal took the next three spots, followed by San Francisco, according to the 2014 Mercer Quality of Living rankings.

The only weakness in ranking Ottawa, Toronto and Montreal compared with Vancouver was their harsher winters, said Luc Lalonde, a principal at Mercer Canada.

“It basically boils down to climate because Vancouver has a relatively mild climate,” Lalonde said Wednesday.

The study also looked at such factors as political stability, crime statistics, public and medical services, consumer goods and recreation. The quality of living index is used by companies to help determine compensation for their employees working abroad.

Ottawa ranked 14th globally, while Toronto was 15th and Montreal 23rd.

Globally, Vienna has been the top ranked city for the last three years, while Vancouver retained its fifth-place spot, Lalonde said.

Zurich was No. 2 worldwide for quality of life, followed by Auckland, New Zealand and Munich, Germany.

Lalonde said the rankings don’t usually change dramatically from year to year.

“Wherever you have stability, good infrastructure and if the environment is politically and socially stable and if you have good public services, these things don’t change overnight.”

Cities with the lowest rankings in North America included Mexico City, financially troubled Detroit, St. Louis, Houston and Miami.

Although Miami and Houston are popular destinations, factors such as crime, air pollution and traffic congestion could have affected their scores, Lalonde said.

The city with the lowest ranking globally was strife-ridden Baghdad, followed by Bangui in Central African Republic and N’djamena in Chad.

Source: LuAnn LaSalle, Canadian Press

Condo shopping can be overwhelming – a pre-shopping checklist can help limit your stress and visits to show homes.

To create such a list, start by visiting presentation centres and model units in person. Although the Internet is a great place to do some basic research, you will learn much more by assessing the quality of materials and construction in person. This will also give you a chance to ask your questions and evaluate the quality of the responses you get. Be consistent with the questions you ask in the showrooms so you can make accurate comparisons.

When visiting, try to speak with the show home’s specialist who assists buyers with their design choices, as they are often present. Take advantage of their expertise regarding upgrades and options. This will be helpful even if you eventually settle on another development.

Before visiting, make a list of those amenities that are important to you and that you are likely to use. Remember, the cost of amenities is embedded in the condo price and the cost of maintaining them in the condo fees.

Some questions to be answered:

• Who is buying units in the condo — singles, couples, students, young families, retirees? This will determine the condo’s culture. Be careful if the units are being sold to investors as rental units; tenants as a group may be less invested in keeping the property up and more frequent turnover will subject the common areas to wear and tear.

• Consider “curb appeal.” Is impressing your visitors with a beautiful facade, entry foyer and other common areas important to you? Not every condo owner cares about the width of the corridors or the decor in the elevators, but many do.

• Is there adequate and convenient visitor parking? A good way to deter friends from coming by is making parking difficult.

• Are the elevators fast and adequate for the size of the building? This is particularly important if you want to be on a higher floor.

• Parking is key. Consider ease of access, adequate space for your car and ease of egress into traffic. Fighting your way into rush-hour street traffic can get old quickly; on the other hand, you may be on a schedule that lets you avoid rush hours.

• It may be wise to purchase a parking space or two even if you don’t have cars — they can become more valuable over time and can always be sold. Parking spaces can be significant inducements when reselling.

• Check out the storage lockers for size, location and internal organization. You don’t want to have to unpack the whole locker just to get at your suitcases in the back.

• Location, location, location. As for all real estate, condo location is paramount. However, there are many factors that determine the value of a given location to a given purchaser. Convenience generally plays a significant role and convenience is a very personal thing. Some of the following points will help clarify this.

• When examining floor plans and fact sheets, make sure you understand the positives and negatives of the layout. If you have trouble visualizing this, educate yourself by quizzing the people representing the various developments about their layouts. You will soon be doing this automatically when you see a floor plan.

Flow is very important, especially if you are used to bigger spaces. Make sure the room sizes meet your requirements. This should include the kitchen, which needs to be more comprehensive if you plan to cook or entertain. Of course, some facilities have beautiful entertaining spaces and catering services. You might prefer this format.

• If cooking is a priority, find out which appliances are included and check them out. If they don’t measure up you may need to upgrade.

• Is a balcony important and will you actually use it? If you plan to garden, make sure you know the rules governing your balcony use. If you have no interest in balcony living, smaller is better than larger as it will save you money and upkeep.

• Are your critical amenities readily accessible? Of course, accessibility will depend on your level of mobility — committed walker, cyclist or driver. Some may require facilities within their condo complex.

• Make sure you know how bright your condo will be and determine how important this is to you. Orientation of principal rooms and window height are the two biggest factors.

• Does the level of security offered meet your expectations? This applies to building access, garage surveillance, and elevator and corridor security.

• Concierge service is both a security and a convenience factor. What will the concierge do for you and during what hours? If you travel a lot, this becomes more important — who accepts the deliveries and brings in the mail?

• What are the rules about pets, both yours and neighbours? How long does it take to get Fido to the grass and what do you do in winter? Or perhaps you don’t want to interact with pets on a regular basis.

• Is the condo on a flight path or adjacent to high tension transmission lines? This may not be important to you personally but may become an important issue on resale.

• Are there lighted recreational facilities nearby that may generate noise in the evening?

• Are there local events such as exhibitions or sports events that may overwhelm traffic circulation intermittently?

Source: Marilyn Wilson, Marilyn Wilson Dream Properties Inc., Ottawa

A housing crash based on the type of home you have? Is that really possible?

It certainly didn’t happen that way in the early 1990s. When the real estate market crashed in Toronto, the entire housing sector saw prices plunge. Even commercial real estate tanked in the high-interest rate environment.

This time around, many wonder whether a specific type of housing could falter while other categories remain strong. Most eyes are on the condo market in such a scenario.

Toronto – now the largest condominium market in North America – is the epicenter for the concern and yesterday another set of statistics showed that market foundering once again.

“A tale of two markets is exactly what we are dealing with. There are different things happening in each market,” said George Carras, president of RealNet Canada Inc., referring to the high-rise versus low-rise comparison.

His research company just looked at new homes but he says it is a pretty decent proxy for what will happen to the existing homes market down the road.

What is happening is low-rise [detached homes] sales are slowing faster than high-rise sales, yet condo prices are the ones getting hit. RealNet’s price index for a low-rise home reached $645,854 in July, up 5.3% from a year ago, while the high-rise index was $430,930, down 1.6% during the same period. The $214,924 gap between the two is the highest on record.

“It’s a complete inverse out there. A decade ago you had three low-rise choices for one high-rise, now you’ve got three high-rise choices for one low-rise,” says Mr. Carras.

High-rise sales are already falling. July sales were 34% below their 10-year average. Yet as of July 31 there are 256 high-rise developments in the GTA with 66,126 units. By the end of 2013, the market will add 17,000 condos.

In the Greater Toronto Area, provincial government policy, which encouraged intensification, has helped foster the condo market. But it’s not just a Toronto issue — the Vancouver condo market has had the same strength over the past five years.

The Real Estate Board of Greater Vancouver says single family detached home prices are up 16.8% over the last five years while apartment prices have risen just 0.2% during the same period.

“I don’t know about a crash in one and nothing in another,” said Doug Porter, chief economist with Bank of Montreal, talking about the two different classes of housing.

But clear differences in the market to the point they are going in opposite directions? That’s another story.

“I can definitely see that happening. A lot of the [condo] market in Toronto and to extent some other cities has been driven by geography and government policy. At some point I can see the markets going in two different directions,” said Mr. Porter.

While the last market crash, discounting the brief pullback in 2008, was driven by soaring interest rates, this one could come from oversupply in one segment of the market.

This has already begun in Quebec where the condo market is feeling the impact of collapsing prices and single family homes have managed to stay in positive territory.

Hélène Bégin, senior economist with Desjardins Group, says it comes down to a supply issue which is being felt most acutely in Montreal where 30% of existing home sales come from high-rise condominiums.

“I wouldn’t say there’s been a crash as much as an adjustment of 5% to 10% that will happen in the next year. We are just seeing the beginning of it,” said Ms. Bégin.

She says the market for single family homes has been better in terms of price because it is more balanced without a massive influx of supply.

“Condo construction slowed sharply in the first half of the year which is excellent news for market fundamentals,” she wrote in a recent report.

It’s not only a supply side issue. Ms. Bégin says demand for condos has also been hit harder because people buying in that segment of the market tend to be more marginal buyers impacted by tougher borrowing rules from Ottawa.

Consumers with less than a 20% downpayment borrowing from a financial institution regulated by the Bank Act must get mortgage default insurance. To qualify for those mortgages, Ottawa has said consumers can only amortize a mortgage over 25 years which is down from 30 years in 2012 after being as high as 40 years.

Shorter amortizations mean buyers have higher monthly payments and can borrow less.

Don Lawby, chief executive of Century 21 Canada Ltd., says the supply of single detached homes is going to keep shrinking.

“There are more and more condos being built in Toronto and Vancouver. They are just a better use of land,” he says.

The key for the condo market might be whether the people buying them, many investors, can rent them out. “If you have a whole lot of empty condos, the developers might bring prices down,” says Mr. Lawby.

But demand still appears strong from renters. Vacancies are rising but Canada Mortgage and Housing Corp. says the latest statistics nationally put the rate at 2.7%, still a tight market to rent in.

And, in Toronto, rental rates are just going up. A report this week from research firm Urbanation said average rents in the city were up 4.1% in the second quarter from a year earlier.

Source: Garry Marr, Financial Post

People are still shying away from investing in Vancouver real estate, April sales numbers show.

This April’s sales were the lowest April total since 2001 and 20.9 per cent below the 10-year sales average for the month, the Real Estate Board of Greater Vancouver reported yesterday.

“While the number of home sales remains below average, properties that are priced right are selling and we’re seeing greater balance between buyer demand and the number of homes listed for sale,” says Sandra Wyant, REBGV president.

There were 2,627 home sales in Vancouver in April, a decrease of 6.1 per cent from last April and an increase of 11.9 per cent from March.

In the Fraser Valley, sales were also up from March, but down from last year, the Fraser Valley Real Estate Board reported.

Board president Ron Todson said sales usually increase in the spring, and this year is no exception.

“What’s different this year is that a number of external factors, such as tighter credit rules and the government’s spotlight on consumer debt have made some consumers more cautious about buying or selling a property,” Todson said in a news release.

Despite sluggish sales, prices have been creeping up again across the Lower Mainland, the real estate boards said.

“There have been modest increases in home prices across the region over the last three months. This comes on the heels of home price declines of approximately five to six per cent in Greater Vancouver during the last half of 2012,” Wyant said.

The home price index composite price in Greater Vancouver is now $597,300 for all property types, the board’s numbers show. Although this is down 3.9 per cent from April 2011, it is up 1.6 per cent from this January.

In the Fraser Valley, the benchmark composite price is $426,900 for all property types, down 0.2 per cent from a year ago, but up 1.4 per cent from January, the RVREB numbers show.

“Pricing is incredibly important in slower than average markets,” said Todson. “We’re not seeing the rapid increases in home values of the last decade, which means that sellers may need to sharpen their pricing in order to be competitive, but buyers won’t see dramatic price drops.”

On April 1, the province reverted to the GST and PST tax structure. Buyers in April saved a bit of money on their real estate commissions under the new rules, because tax on real-estate commissions is reduced to five per cent from the 12 per cent HST.

The Fraser Valley region includes North Delta, Surrey, White Rock, Langley, Abbotsford and Mission, while the REBGV includes Vancouver, Richmond, Ladner, Tsawwassen, North Vancouver, West Vancouver, Burnaby, Coquitlam, Bowen Island, Maple Ridge, New Westminster, Pitt Meadows, Port Coquitlam, Port Moody, Squamish, the Sunshine Coast and Whistler.

Meanwhile, a new BMO report out Thursday found that Eighty per cent of prospective buyers know if a home is right for them as soon as they step inside.

The BMO Psychology of House Hunting Report says Canadians spent an average of five months house hunting and viewed 10 homes before buying.

Nearly 70 per cent of buyers are willing to settle for less than perfect, but one-third feel rushed into making a purchase, the report says.

Canadian homeowners spent an average of five months house hunting and visited ten homes before making the decision to buy, the report says.

Source: Tracy Sherlock, Vancouver Sun

The number of sales may be down in multi-family developments, but buyers are still keen on new homes in highrises near transit lines, Colliers International’s most recent residential real estate report for Metro Vancouver found.

Three developments in particular — Station Square and Solo District, both in Burnaby, and MC2 in Vancouver — were bright spots in the report, which said that overall multi-family sales were down 15 per cent in the third quarter of 2012, to 1,899.

“This is the second consecutive quarter in which sales volumes have decreased. However, despite all the crash talk, the sales volume posted this quarter and year to date is evidence of sustained demand for new multi-family homes in the Metropolitan Vancouver market,” said Scott Brown, senior vice-president, Colliers Residential group.

He said demand in the resale market is softer than demand for presales because presales tend to attract investors, particularly if they are near transit and will be attractive to renters.

“The ones that are selling the fastest are on transit and appealing to investors,” Brown said. “The buyers are a little bit more concerned about the immediate, short-term future, but there still is demand there and their belief in the long-term fundamentals of the Vancouver market is why they’re investing in these properties.”

Station Square is a five-tower development in Burnaby near Metrotown that will be ready for occupation in 2015. Units were priced from $280,000 for a studio apartment up to $1.35 million for a penthouse suite.

The first building of 269 units is mostly sold out, after about three months of a soft opening and a public opening Oct. 20, said Greg Zayadi, director of sales and marketing for Anthem Properties, which is a partner of the Beedie Group on Station Square.

“The location is key,” Zayadi said, adding that buyers want to be close to SkyTrain and Metrotown. He said most of the buyers are what he calls “family investors”: people who are buying with the plan that someone in their family will eventually live in the suite. He said 40 per cent of buyers at Station Square already have an address in Burnaby, while 30 to 35 per cent have an address in Vancouver.

Although they have addresses in the Lower Mainland, those might be homes of relatives, Zayadi said.

“Approximately 70 per cent of highrise sales occurred at developments targeting the Chinese buyer. While it is evident that the Chinese buyer is not as active as in recent years, this purchaser group does continue to be the primary buyer in Vancouver and Burnaby,” the Colliers report states.

Realtor Sunny Lee, who sold seven units in Station Square, said most of the people he sold to were investors, and that some were buying for their children. He said he believes Station Square sold so well because it is very close to SkyTrain, but not so close that the noise is a factor.

He said this year he has sold more pre-sale new homes than re-sale homes, which is unusual for him.

“Buyers are concerned about the current market, but they still believe in the future,” Lee said, adding that people are looking for a good investment in this low-interest rate environment. “They want to put their money somewhere.”

He said buyers of pre-sales usually put between five and 10 per cent down when they sign the contract, then another five to 10 per cent about six months later, with the remainder due when they move in.

The Colliers report also mentioned Appia’s Solo District development in Brentwood as selling well.

Looking ahead, in the fourth quarter of 2012 two projects are expected to keep sales flowing: Mosaic’s Elizabeth, near Queen Elizabeth Park, and Intracorp’s MC2.

MC2 is a two-tower development on Marine Drive and Cambie Street in Vancouver, directly across the street from the Canada Line. There are 443 homes in 26-storey and 32-storey towers, with prices for one-bedroom suites starting at $259,000 and two-bedroom suites at $421,500. The project opened for sale Oct. 27 and since then has sold 347 homes, said Linda Chu, director of marketing for Rennie Marketing Systems, which is selling the project.

Brown said people downsizing from single-family homes are also driving multi-family sales. He said developers are starting to build larger multi-family units — bigger than 1,000 square feet — to appeal specifically to downsizers rather than investors.

The Colliers report calls for annual sales volumes of 10,500 multi-family units in 2012, with a similar amount projected for 2013.

Canada Mortgage and Housing Corp. says housing starts in Metro Vancouver are forecast to remain flat in 2013.

Although the 2012 sales numbers of multi-family units are down more than 10 per cent from 2011, 2012 stands to be the second-best year for multi-family sales since 2007, the Colliers report said.

“2011 was an outstanding year. 2012 is a very good year,” Brown said. “We think 2013 will be about the same.”

Source: Tracy Sherlock, Vancouver Sun

This home in Kings Landing is as close to the water’s edge as you can get. Exceptional 3-bedroom, 4-bathroom suite with a one-of-a-kind combination. 2-car private garage and SouthWest exposure!! The property has one of the best floorplans to be found anywhere. Kings Landing is recognized as one of the most sought-after addresses in downtown Vancouver.

The condo has superb quality throughout the suite and the complex itself. With arguably the best private facilities of any condo residence building downtown. This gorgeous suite has a very elegant flow and feel. No stark cold lines here. Lots of crown and base moldings with waterfall granite detailing on all the counters.

3 bedrooms, 4 bathrooms including a steam shower in the luxurious ensuite. Double dishwashers, 6-burner Viking stove, Sub-Zero fridge, wine fridge: A really elegant home feeling in a very hip location.

Directly on Vancouver’s famous Sea Wall with parks on both sides. Only a few minutes’ walk to Yaletown, the marinas and Granville Island’s aqua bus.

$3,298,000 through realtor Mark Raymond at RE/MAX Select Properties.

For further information, please click Kings Landing home for sale in downtown Vancouver.

A new condo report suggests first-time buyers, retirees and population growth will continue to fuel demand and price growth for the compact living spaces over the next few years.

The study by Genworth Canada found that average condo resale prices are expected to rise next year in seven of the eight metropolitan centres studied.

Prices in Toronto are projected to jump 2.5 per cent to $312,352.

The highest increase however, is expected to be in Edmonton where prices could rise 3.2 per cent.
Vancouver is the only city where condo prices are expected to drop, by two per cent to $348,152.

The report stands in contrast to warnings from economists and officials that the condo market in some hot markets is reaching bubble territory that could soon burst.

The Bank of Canada and federal Finance Minister Jim Flaherty have cautioned Canadians repeatedly to moderate borrowing on real estate, declaring household debt to be the domestic economy’s number one enemy.

The central bank noted certain segments of the housing market that have a persistent oversupply — such as condos in Toronto — face a higher risk of a price correction.

Genworth — which earns revenue from selling mortgage insurance — notes that rising prices for single-detached homes are driving first-time buyers to condos, but retirees also continue to prop up demand.

It suggests that the population is expected to grow in all eight cities studied over the next few years, while employment growth and low interest rates should also support the market.

“This data corroborates our view that the demand for condos in Canada, particularly at the price-point we insure, is well supported by our economy and our population,” said Brian Hurley, chairman and CEO of Genworth Canada.

“For those seeking to own a home affordably in urban centres, condos remain a good option.”

The Genworth Canada report, produced with the Conference Board of Canada, reviewed trends in Quebec City, Montreal, Ottawa, Toronto, Calgary, Edmonton, Vancouver and Victoria.

Census figures for 2011 released in February show multi-unit dwellings — a category that includes condominiums — making up roughly half of all new housing stock, a category traditionally led by detached homes.

The numbers also indicate that Canadians are flocking to urban centres. Toronto’s population jumped more than 17 per cent over the previous census period in 2006.

A recent CMHC report said housing starts and home sales have been strong in 2012 — particularly when it comes to multiple-dwelling units such as townhouses, condos and apartments — but will soften moderately in coming months into 2013.

Source: Sunny Freeman, Canadian Press