Repeated warnings of an overheated market failed to deter home buyers in Canada’s largest cities in 2013, with the number of Toronto home sales up two per cent over the previous year, Vancouver sales were up 14 per cent and Calgary sales rose 11 per cent.

Homes in the Greater Toronto Area continued their robust rise in price, up 5.2 per cent to an average price of $523,036 in December, compared to $497,130 in 2012, the Toronto Real Estate Board reports.

After a slow start to 2013, GTA housing sales picked up in the second half of the year. Total sales for 2013 were 87,111, compared to 85,496 transactions in 2012.

Even the condo market showed gains, with the average price in Toronto rising 7.6 per cent to $367,376 compared to December 2012, while detached homes prices rose by nearly 19 per cent to $864,351.

Although December sales tend to be slow, new listings were down almost four per cent in December, which helped fuel frantic bidding wars in some Toronto neighbourhoods close to the downtown and transit lines.

For Metro Vancouver, total sales of detached, attached and apartment properties in 2013 reached 28,524, a 14 per cent increase from the 25,032 sales recorded in 2012.

But the number of residential properties listed for sale on the MLS declined 6.2 per cent in 2013 to 54,742, part of a trend in major cities as baby boomers hold onto their properties.

The average house price in the Greater Vancouver area was $603,400.

The price of a detached single family home rose 2.5 per cent to $927,000, while condo prices were up 1.8 per cent for the year to $367,800.

“It was a year of stability for the Greater Vancouver housing market,” said Sandra Wyant, Real Estate Board of Greater Vancouver president. “Balanced conditions allowed home prices in the region to remain steady, with just a modest increase over the last 12 months.”

In Calgary, 16,302 single family homes changed hands, an eight per cent increase, and 4,007 condos were sold, a 14 per cent rise.

The benchmark price for a single-family home was $472,200 in December, an 8.6 per cent increase from the previous year.

“Two consecutive years of elevated levels of net migration, combined with an improving job outlook and confidence surrounding long-term economic prospects, supported the demand growth,” said Ann-Marie Lurie, chief economist for the Calgary Real Estate Board.

How strong the housing market remains in 2014 depends on interest rates.

Finance Minister Jim Flaherty warned in an interview Sunday that Canada will face global pressure to raise rates in 2014 as the U.S. Federal Reserve pulls back on its stimulus efforts and the U.S. economy rebounds.

The Toronto Real Estate Board predicts price growth will continue to exceed inflation in 2014, largely because demand for low-rise houses continues to far outstrip supply.

“The seller’s market conditions that drove price growth in the second half of 2013 will remain in place in many parts of the GTA,” said TREB senior manager of market analysis Jason Mercer.

“Some neighbourhoods, especially those characterized by low-rise house types like singles, semis and townhomes, will continue to have less than two months of inventory.”

In Calgary, both prices and numbers of sales are expected to rise in 2014, the Calgary real estate board said, but the increases are not likely to be as steep as in 2013.

Source: CBC News

The changes aren’t big but for the second year single-family homeowners in Vancouver will see the west-side, east-side differential in their property values narrow with west-side homes losing a bit of ground and east side values rising, according to BC Assessment Authority data released this morning.

From the BC Assessment’s perspective, the picture is one of stability, according to Charmesh Sisodraker, deputy assessor for the Vancouver Sea to Sky region with most property owners seeing modest changes of plus or minus five per cent.

For Vancouver’s west side, BC Assessment pulled example assessments to demonstrate the trend showing a house on a 50-foot lot valued at $1.61 million for 2014, compared with $1.62 and a house on a 33-foot lot assessed at $1.25 million for 2014, down marginally from $1.26 million.

By contrast, the trend example for the east side was a single-family home on a 33-foot lot valued at $1.13 million compared with $1.08 million in 2013.

Condominium apartments on both sides of Vancouver saw their assessments slip. A two-bedroom downtown apartment saw its 2014 assessment slide to $543,000 in 2014 from $567,000 in 2013, a two-bedroom east-side apartment dropped to $364,000 in 2014 from $383,000 in 2013 and a west-side two-bedroom declined to $571,000 in 2014 from $599,000 in 2013.

BC Assessment valuations are estimates of a property’s market value as of July 1, and physical condition as of Oct. 31, with results released publicly in early January to be used by municipalities for setting property taxes.

In Metro Vancouver, the City of Vancouver saw the total value of all of its properties rise to $254.5 billion for 2014, including $3.1 billion of new construction and subdivisions, compared with $248.9 billion in 2013.

Homeowners can compare their assessment to their neighbours online.

Source: Derrick Penner, Vancouver Sun

The median resale price of a home in British Columbia is expected to increase at an accelerating rate over the next three years, according to a new forecast by Central 1 Credit Union.

The median resale price is expected to end this year at $388,000, up about 1.5 per cent following a decline in 2012, Central 1 says.

And while the credit union’s economist Bryan Yu expects that rate of increase to continue through 2014, he predicts bigger increases in the following two years.

“We have revised the provincial pricing outlook higher and expect prices to rise about 1.5 per cent in 2014, 2.5 per cent in 2015 and three per cent in 2016, taking the median price to $415,000,” Yu said in a news release issued this morning.

Central 1’s forecast calls for total home sales to be under 70,000 for 2013, but that should rise about seven per cent to 72,500 in 2014, and hit 84,000 in 2016.

“Although growth is significant, the sales level remains low when adjusted for the population base,” Yu said.

Yu said the volume of home sales will depend on population and economic growth, both forecast to expand at a subdued pace through most of 2014 before accelerating later in the forecast period..

He added that low mortgage rates will continue to support housing demand, but rising rates will eat into affordability.

Source: Vancouver Sun

New data released yesterday from the organization that represents home sellers shows Canada’s housing market continues to hit new highs, with the average price increasing by almost 10 per cent in the last 12 months to $391,085.

The Canadian Real Estate Association said the strong gain was in part because this time a year ago, sales were down in some of the largest housing markets.

When prices in Toronto and Vancouver are stripped out of the equation, the average annual price gain was 4.3 per cent, CREA said.

Aside from prices, the realtor group says the number of homes sold was a little below the peak in September, but higher than the number this time last year and still close to the historical average.

A total of 434,678 homes have traded hands across the country this year, CREA says. That’s about 0.2 per cent higher than last year’s total.

“While there has been a lot of volatility in sales activity from month to month, sales for the year to date are on par with fairly steady levels posted for the same time period in each of the past five years,” CREA’s economist Gregory Klump said.

The average price rose 9.8 per cent compared to a year ago, but actually had dropped on a monthly basis. November’s average price was slightly lower than October’s, $391,820.

“Most housing markets are well balanced, including many large urban centres,” Klump said.

“Housing price gains are always stronger in places where supply is tight relative to demand, such as we’re seeing in Calgary and in parts of southern Ontario including the low-rise market in Toronto.”

Source: CBC News

B.C.’s housing market will remain strong in the coming year as residential real estate sales and average prices nationally have soared to a five-year high, according to a new report by Re/Max.

The Housing Market Outlook 2014, released Wednesday, said improved economic performance combined with historically low interest rates and rising consumer confidence should spark greater gains in 2014, with housing sales and values expected to further appreciate.

The report said the number of homes sold this year is expected to match or exceed 2012 levels in almost two-thirds of markets across the country, led by strong activity in B.C., including Vancouver and Kelowna.

Home buying in B.C. kicked into high-gear in June, led by the Lower Mainland, Kelowna and Victoria. Although there are several factors that are expected to contribute to rising housing values nationally, one of the most pressing is continued construction in Vancouver and Toronto, said Elton Ash, regional executive vice-president of Re/Max of Western Canada.

The availability of low-rise homes relative to the population is expected to contract, in favour of vertical growth, and its affordable price point is representative of the future.

“We’re definitely seeing a greater commitment to higher density at a municipal level,” Ash says. “In fact, the trend already underway in Vancouver and Toronto has gained serious momentum in smaller markets where cities are moving to infuse vibrancy into the urban core through mixeduse residential/commercial/retail development. The level of investment is substantial – dovetailing with revitalization efforts currently underway.”

Nationally, an estimated 466,000 homes will change hands in 2013, an increase of three per cent over sales recorded in 2012.

Canadian home sales are expected to climb two per cent to 475,000 units by the end of next year. The average price of a Canadian home is forecast to appreciate four per cent to $380,000 in 2013, up from $363,740 in 2012.

Values are expected to continue to escalate in 2014, rising three per cent to $390,000 by year end, the report said.

Source: Tiffany Crawford, Vancouver Sun

Vancouver city council is proposing increases in property taxes and utility fees for 2014 below the rate of inflation.

The proposed increases, 1.9 per cent for property taxes and one per cent for utilities such as water, sewer and garbage collection, come just before Mayor Gregor Robertson’s Vision Vancouver administration seeks re-election.

The proposal, which is expected to be ratified next Tuesday, would boost the city’s overall operating budget to nearly $1.2 billion, an increase of $29.6 million. Of that, more than $5 million would go toward new priorities, including more money for social inclusion, culture and recreation, Greenest City initiatives, safety and emergency planning and digital services. The rest involves inflation and program adjustments.

The details are contained in a massive 220-page operating and capital plan document the city unleashed on the public after some people, including opposition Coun. George Affleck, complained about the city not being transparent with its budget process.

The new increases, if approved, would see property taxes for a residential property worth $1 million go up by $36, and utility fees another $29.

Vision Vancouver Coun. Raymond Louie, the chair of the city’s finance and services committee, said the proposed increase is a bargain compared to proposed tax increases in other Metro Vancouver municipalities. Surrey will raise its property tax rates by 2.9 per cent in 2014.

Last year Vancouver was the city with the second-smallest tax increase in Metro, 1.36 per cent, behind West Vancouver.

Louie credited the Vancouver Services Review Program, which has identified $53 million in unnecessary programs and expenditures, for allowing the city to keep tax increases low.

Source: Jeff Lee, Vancouver Sun

Red and green may be the trademark colours of the holiday season, but if you want to wow your guests, try experimenting with alternative colour combos. British design icon and television personality Debbie Travis has named berry pink the colour of the season.

“This was a hot colour this year for clothes and we know home always follows fashion,” she says.

This deep, cheerful pink with a hint of purple is a refreshing twist on the traditional cherry red of the holiday season. Travis chose the colour because it adds a touch of sophistication and fun and goes well with modern decor, complementing dark wood and metals such as silver and gold, which have risen in home decor popularity in the last couple of years.

“I think it’s a really happy colour for the holidays and it’s got that little bit of an edge to it,” she says.

Travis has teamed up with Canadian Tire, offering an exclusive line of berry pink holiday decor. She offers her top tips for holiday decorating with the hue.

1. Break decor rules

“The whole point of the holidays is that it’s the one time of the year to throw all those decorating rules out the window and have some fun (with colour and combinations),” says Travis. While berry pink may not be a colour you would choose for your living room walls, she says we should forget trying to match holiday decor with our everyday themes. Ignore the idea that you need to use traditional colours if you have traditional living room furniture or contemporary ones if you have a modern living space.

2. Switch it up

Change your holiday decor each year to create interest in your home, she says, since we tend to have the same people over at Christmas. While you don’t have to throw away all of your decorations and start anew each year, simply adding a new colour of the season and pairing it with holiday staples such as gold, silver and white can create a whole new look that will keep friends and family guessing what your home will look like.

3. Choose a main colour

Select one colour as your main thread, then add complementary winter colours such as white or silver. Although Travis says it’s impossible to go overboard with colour during the holiday season, toning it down with a contemporary metal such as gold, silver or a neutral brown tone can make the colour really pop in your space.

4. Experiment

Take a twist on the traditional red and green colour combination and try something unique, like pairing berry pink with peppermint or lime green to give your decor a more contemporary look.

5. Get organized

Before hanging decorations, Travis spreads everything out on the floor to see how ornaments look next to each other. Try incorporating a variety of textures, patterns and materials to create interest such as mixing ribbons in quilted and knitted textures with feathers and ornaments.

6. All the rest

Decorating is not just about the tree. It’s important to create a unified look by adding touches of holiday colours throughout all areas of the home where guests will be, says Travis. Hand towels in the powder room, ribbons on the backs of chairs, table decorations and a wreathe on the front door or in the window above the kitchen sink — all incorporating your chosen holiday colour — help to create a cohesiveness to your holiday look.

Source: Lisa Evans, In Homes

Good news for homeowners and buyers as the Bank of Canada has just announced that it will hold its key interest rate steady but sounded a touch more dovish in its outlook, saying the risks of undesirably weak inflation appeared greater than they did six weeks ago.

The central bank stunned markets in October by abandoning 18 months of signaling that rate hikes were on the horizon. But it made clear at the time it was just as likely to raise rates as to lower them as it was caught between excessive household debt on one hand and below-target inflation on the other.

The bank’s statement today showed it was now increasingly concerned about possible disinflation after the inflation rate dropped to 0.7 percent in October. It added, however, that the balance of risks remained within the range of possible scenarios it identified in October.

“The risks associated with elevated household imbalances have not materially changed, while the downside risks to inflation appear to be greater,” it said.

“Weighing these considerations, the bank judges that the substantial monetary policy stimulus currently in place remains appropriate …,” it said.

The Canadian dollar briefly weakened after the statement to C$1.0689 to the U.S. dollar, compared with C$1.0663 an hour earlier.

The bank has kept its overnight rate target at 1 percent since September 2010, following three successive hikes that year as Canada pulled out of a relatively mild recession.

None of 32 analysts polled by Reuters last week had expected any rate move on Wednesday, but many market players were nonetheless bracing for the possibility that the bank would somehow introduce more dovish language without signaling actual rate cuts.

The median forecast in that poll was for the bank to start raising rates in the second quarter of 2015.

Source: Reuters

Everyone’s dream home is just the right size, in the perfect neighbourhood, with exactly the features and amenities they had in mind. In reality, every home, even a brand-new one, will have flaws. The question is, are they reasonable issues or signs of an impending disaster?

1. Put Safety First

Anything that could be a safety issue is worth looking into. Investigating a home’s electrical system, for example, is crucial. Insurance companies don’t like knob-and-tube wiring (found in homes dating back about 50 years), which they label a fire hazard. The system must often be upgraded within 30 days of closing in order to get insurance, and it’s a messy job that starts at about $5,000 per storey. Also problematic are homes from six or more decades ago that have only 60-amp electrical service, which isn’t enough to support today’s appliances. That means new masks, new wiring and a new electrical meter and panel.

2. Check The Water System

Water is another key component that merits a thorough check. After making sure the basic functions of their taps and toilet work, buyers should get documents from the seller that prove the water system is legal and has been inspected, and that all renovations have been done with a permit. Otherwise, their home insurance won’t cover anything that goes wrong with those renos.

3. Look Out For Mould

Watch for evidence of mould in a prospective purchase, especially if you live in British Columbia. The No. 1 issue in Okanagan real estate for the past 10 years has been grow ops – it can cost $30,000, $50,000 or more to rehabilitate a home, says one expert. Mould – which can also be caused by flooding and leaks – can affect air quality and cause respiratory problems. Even after a former grow op is brought back up to bylaw standards, homeowners need to make sure they have papers to prove it. Otherwise, when it comes time, reselling will be a major headache.

Mould and many other more serious problems, such as asbestos, aren’t technically covered by a home inspector’s mandate or insurance. An experienced inspector will share his suspicions, then pass clients on to an expert to confirm those suspicions and suggest options. A savvy real estate agent might be able to negotiate with the seller to have the cost of a mould inspection subtracted from the purchase price.

4. Ensure A Sturdy Foundation

Foundation settlement is also a danger. Caused by extreme moisture changes, weak soil or poor drainage, it results in wall cracks that threaten the house’s structural integrity. Homes can end up needing extensive foundation upgrades to repair. It can cost hundreds of thousands of dollars to fix, and soil settlement due to underground streams can make already pricey homes staggeringly expensive.

Source: Denise Balkissoon, Reader’s Digest

Canada’s housing market is not in a bubble and not likely to suffer a sudden and sharp correction in prices unless there is another major global shock to the economy, Bank of Canada governor Stephen Poloz said Wednesday.

The central banker, testifying before the Senate banking committee on his latest economic outlook, said he believes the most likely scenario is a soft landing where home prices stabilize, although he acknowledged that an imbalance in the market and high household debt remain key risks.

Poloz used the testimony to pointedly disagree with a couple of forecasting organizations that weighed in this week on the Canadian situation — the Fitch Rating service that judged Canada’s housing market as 21 per cent overpriced, and an OECD recommendation that he start raising interest rates in a year’s time.

“Our judgment is (the housing market) is a situation that is improving, this is not a bubble that exists here that would have to be corrected,” he said. “If there is a disturbance from outside our country that’s another analysis.”

Poloz said most of the fundamentals surrounding the housing market appear headed in the right direction. The prospects for the economy is improving, he noted, which should create more jobs.

As well, he said banks are now demanding higher credit scores from new borrowers and added that he does not believe there has been serious overbuilding in the housing market.

“It looks expensive,” he said of home prices. “But which markets are expensive? Well those markets have been expensive my whole life,”he said, noting that Toronto and Vancouver both absorb high rates of immigration.

Asked to put odds on his soft landing scenario, Poloz said he would place it in the 60-to-80 per cent probability range.

Source: Julian Beltrame, The Canadian Press