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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 31, 2019 216   0   0   0   0   0
While B-20 substantially cooled Canada’s residential real estate market, it’s proven a boon for the commercial sector. “On the commercial front, we’re seeing a lot more activity on buildings of more than 5 units,” said David Goncalves, a mortgage broker and partner of Mortgage Alliance Vine Group.“We’re seeing this upswing because people got squeezed out of buying residential properties because of the lending rule change, and as a result we’ve seen significant growth in the commercial sector.” In Toronto, mixed-use developments have exploded in popularity among investors, and Vine Group has capitalized on the growth by securing financing for small and mid-sized real estate developers.While residential lending practices have changed to become more restrictive, commercial underwriting practices have become more liberal. “A lot of lenders on the residential side have door policies,” Hugo Dos Reis, a partner at Vine Group, said of limits placed on residential investment properties.“Lenders don’t want to loan to holding companies, and if they do they charge a premium.Even the big banks are getting away from that as well, but what we’ve found is that a lot of people are looking at multi-residential commercial properties instead of buying, say, a triplex. “The lending now is on the asset and the most important part of the deal:cash flow.The client’s exposure
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 31, 2019 217   0   0   0   0   0
Underscoring just how tight the Vancouver housing market is, the British Columbia city was ranked the second least affordable city in North America. According to real estate site Zoocasa, Vancouver was second among 30 major US and five Canadian cities.San Francisco was ranked least affordable overall and Los Angeles was in third place.And on the other end of the spectrum, Calgary was revealed to be the most affordable housing market in North America. Read more:RBC:Housing affordability has improved for the first time in 3 years[1] The survey examined the median home prices for December 2018 calculated the minimum income required to purchase homes in each city.That amount was then compared to the actual median income earned, to determine whether the market presented buyers with an income surplus or an income gap, which indicates incomes have not kept pace with real estate price growth. The survey found that Vancouver had an income gap of $99,517, compared to a median income of $65,327.By comparison, Calgary had an income surplus of $40,297, and a median household income of $97,334.And another Canadian city, Ottawa, ranked sixth in affordability, with an income surplus of $27,714 based on the median income of $85,981. Are you looking to invest in property?If you like, we can get one
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 28, 2019 237   0   0   0   0   0
The last three months of 2018 finally brought some improvement to housing affordability across Canada. After more than three years of declining affordability, RBC Economics says its measure shows widespread improvement;although first-time buyers in the hottest markets are still facing a significant struggle. In its Housing Trends and Economic Report, RBC’s aggregate housing affordability measure reduced by 0.7 percentage points to 51.9% last quarter (measured as a share of household income). But in the three most expensive markets there is still a crisis with Toronto, Vancouver, and Victoria showing little improvement in affordability for most buyers. Vancouver’s affordability crisis endures despite being in “full-blown correction mode.RBC says that even with the slump in sales, high prices means homeownership still requires an eyewatering 84.7% of household income. Cooling market conditions in Toronto has taken a bite out of sales but RBC expects prices to be flat over the next two years;that won’t help the well-above-average affordability measure of 66.1%. Montreal’s housing market is heating up but prices are rising at a steady pace. The area’s affordability measure is some way below the two hottest markets and below the national average, but at 44.5% it is near a decade high. Condos no longer the affordable alternative The traditional option of
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 28, 2019 274   0   0   0   0   0
There could be a spike in mortgage applications in the third quarter if a rate forecast from the British Columbia Real Estate Association is realized. The association’s economists are expecting interest rates to ease during much of 2019 as weaker economic conditions force a hold-steady from the Bank of Canada. If 5-year bonds maintain their current level, there should be a move for the 5-year qualifying mortgage rate, which has not moved for almost a year. Their forecast calls for 5-year qualifying mortgage rates to fall from 5.34% in the first quarter of 2019, to 4.99% in the second quarter, and reaching a year-low of 4.84% in the third quarter. Rates are then predicted to climb to 5.15% in the last quarter of 2019 and early 2020 before plateauing at 5.34% for the rest of 2020. The 5-year average discounted rate is set for a drop to 3.44% in Q2 2019 (from 3.60% in Q1), then a low of 3.30% in Q3 before climbing back to 3.44% in Q4, 3.64% in Q1/2 2020, and 3.74% in Q3/4 2020. BoC to cut rates? There are some economists predicting that the BoC may actually cut rates in 2019 rather than just maintain their current level. However, BCREA’s economists do
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 28, 2019 241   0   0   0   0   0
Alternative lender Cashco has launched an awareness campaign on social media to raise the issue of those Albertans who cannot access credit. The #needmilkmoney campaign has surveyed 3,000 Albertans and says that across Canada it estimates more than 5 million people are ‘underbanked’ – they have a bank account but cannot access other services due to high costs. "We want politicians to know that there is a portion of our population that is not being served by mainstream financial institutions," says Courtney Johnston-Naumann, Vice President of Marketing &Communications, Cashco Financial."The stories of families in our communities who struggle between paycheques is real.They are hardworking people who sometimes need a hand up, not a hand out, to be able to pay regular or unexpected bills in moments they need it the most.They should be able to access the credit they need without the many constraints currently in place that make it more difficult to pay back." Cashco says that An Act to End Predatory Lending introduced by the Alberta government in 2016 limits fair and equitable access to credit and makes building a positive credit history harder. “The language and limitations imposed in the Act were a surprise to us," said Tim Latimer, CEO, Cashco Financial."It indicated that there was very little understanding of
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 28, 2019 202   0   0   0   0   0
A new platform could make investing in Canada’s most expensive real estate market less daunting. Vancouver-based Fraction is an equity stake lending platform that bills itself more secure than traditional home equity lines of credit, and by taking a 40% equity stake in a property can reduce mortgage payments by 35%. If Fraction were enlisted at the transaction’s outset amd put up 40%, the purchaser would then only need to secure mortgage financing for the remaining amount. “If you own a home and want to take some equity out of it, your existing option is you could sell, get a HELOC or reverse mortgage, but we think our option is better because you can sell up to 40% of the future value of your home to us.It’s almost like selling shares in a home,” said Fraction’s Chief Technology Officer Josh Baker. Baker also touts the platform as an easier way to invest in additional real estate properties. “If you want to invest in real estate in Vancouver, you could buy securities from us, which will represent a pool of properties in the city, and the value of those securities is debt-protected,” he said.“Because we’re investing in residential real estate, we’re using the fundamentals of a mortgage, meaning it’s a mortgage charge
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 28, 2019 210   0   0   0   0   0
New regulations may cool down rental prices in Kelowna, B.C., which rentals.ca ranked as the ninth most expensive rental market in Canada. On rental.ca, the average rental listing in Kelona for a one-bedroom was $1,299 and $1,754 for a two-bedroom.Comparatively, the average national rent for all bedroom types in February was $1,800 – a 1.8% increase from the month prior. Read more:Kelowna prices exhibit significant Q1 growth[1] Reacting to a tightening rental market, the Kelowna City Council voted in early March to add restrictions to short-term rentals on platforms such as AirBNB by licensing owners $345 a year.According to local news outlet Salmon Arm Observer, the move is expected to open up a few more units for long-term rentals. Kelowna Community Planning Manager Ryan Smith told Salmon Arm Observer that he estimated 700 to 800 units could be added to rental market after the new regulations are enforced.Smith added, however, that “because of the seasonality” nature of tourism in Kelowna, that number is hard to predict. Additionally, Taylor Pardy, a senior analyst at the Canada Mortgage Housing and Corporation (CMHC), told Salmon Arm Observer that the vacancy rate will be higher in 2019 and 2020 than in the past three years because of “the volume of apartment rental units currently
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 28, 2019 217   0   0   0   0   0
Property developer Cadillac Fairview (CF) and asset manager TD Greystone Asset Management (TD Greystone) have announced plans to revitalize major Toronto shopping centre CF Fairview Mall. According to CF, an estimated $80 million will be dedicated to revamping 230,000 square feet of existing department store and other retail space to introduce more brands to the property;create a new row of restaurants;and improve pedestrian access to the nearby Don Mills subway station. Construction is expected to begin this month with completion of the revitalization project is slated for 2023. Read more:Toronto remains a strong real estate investment magnet[1] CF and TD Greystone are also in discussions with city officials about rezoning the CF Fairview Mall site to accommodate additional, mixed-use density to meet the needs of the growing community.Future development plans may include residential, hotel, and office space along the periphery of the property. "This area is undergoing many changes which reflect peoples' desire to work, live, shop and dine in a dynamic, transit-connected mixed-use community," said Wayne Barwise, executive vice president of development at Cadillac Fairview."Our redevelopment plan is about diversifying CF Fairview Mall and the surrounding land so we can continue to offer a vibrant destination for people to come together and enjoy." "We are excited to be
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 26, 2019 188   0   0   0   0   0
Ascertaining exact valuations for commercial real estate holdings is as daunting as it is convoluted, but an American platform is simplifying the process. VAL, a cloud-based software that integrates internal and external applications, is a game-changing model for the commercial sector of the real estate industry.In essence, VAL predicts valuations through the duration of the asset hold, be it a decade or 15 years, by drawing upon myriad sources of data, and in the process it’s become one of the most efficient cash flow modeling tools on the market. “In its bare bones, it tells you the value of your asset today based on the way it will perform over however long your time horizon is,” said Stu Sleppin, managing director of Rockport VAL.“It will allow owners to make better informed decisions.Just as someone underwrites a loan to buy a house, they will look at your financials and make a decision;VAL does the same thing with a commercial real estate asset.” In fact, even banks use VAL to determine a commercial property’s long-term trajectory. Sourcing building, tenant and construction data compiled over years, VAL is, simply put, disrupting the commercial real estate industry like few things before it.VAL’s calculation engine is its key, says Rockport VAL’s Timothy Benz, director of sales. “It
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 26, 2019 189   0   0   0   0   0
Bridgemarq Real Estate Services has announced that it filed its annual information form, management information circular, and related annual meeting materials on SEDAR. In the filings, Bridgemarq set its annual meeting for May 7, 2019 in Toronto.The term of Simon Dean as director at Bridgemarq will also expire on that day, and he has announced that he will not be seeking re-election to the board. Brookfield’s board extended thanks Dean for his contributions and wished him well his future endeavours. Read more:The new investment vehicles that’s driving up returns[1] To replace Dean, Bridgemarq’s board has proposed Colum Bastable as a director-nominee to be considered for election at the annual meeting.Bastable has over 40 years of experience in the real estate services industry, including his recent role as chairman of Cushman and Wakefield Canada, a leading provider of commercial property brokerage services.Further details about Bastable can be found in the management information circular, which is available for download on SEDAR. Bridgemarq is a leading provider of services to residential real estate brokers and has a network of over 18,000 realtors.The company operates in Canada under the Royal LePage, Via Capitale, and Johnston &Daniel brands. Are you looking to invest in property?If you like, we can get one of our mortgage experts to tell
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 26, 2019 197   0   0   0   0   0
Constellation HomeBuilder Systems, a provider of home building software and services, announced the acquisition of online listing service NewHomeListingService.com. With the common goal of connecting buyers, builders and real estate agents, the NewHomeListingService.com team will be joining Constellation HomeBuilder Systems to further expand the most comprehensive homebuilding and land development platform in the industry. Read more:Technology disrupts commercial real estate[1] NewHomeListingService.com will be integrated with the NEWSTAR, FAST, and BuildTopia enterprise resource planning platforms of Constellation HomeBuilder Systems.The integration will allow data to sync in real-time so that prospective buyers have access to the accurate and updated information. "This acquisition provides a growth opportunity for both businesses and supports our strategy to help builders manage their business more successfully,” said Chris Graham, vice president of Constallation HomeBuilder Systems.“Promoting new homes and condos is easier than ever before.As builders look for more effective ways to connect with homebuyers, we will be well-positioned to support them on that journey." "Constellation HomeBuilder Systems offers a tremendous opportunity for NewHomeListingService.com to further expand its service offering in Canada and the United States," said Milo Anderson, founder of NewHomeListingService.com."Joining Constellation creates the perfect synergy allowing builders to get the most exposure for their new homes and condos in the most convenient way." Are you looking to invest in property?If
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 24, 2019 251   0   0   0   0   0
Air-tight compliance is the key ingredient to syndicating mortgages and a nascent Toronto firm is paving the way forward that sector of the real estate industry. “We’re a community of investors and partners who only underwrite deals we feel are good for our investor base, and how we do that is to make sure we only get compensated when the investor can generate a principal return from their investments,” said Luan Ha, founder and CEO of Fundscraper. Fundscraper arranges bridge financing for large developments on first, second, or combination, mortgages between one and three years, and it’s setting a new standard by using technology to both reduce costs and protect investors.Using a complex technological algorithm to assess potential investors’ suitability for syndicated mortgages, Fundscraper is also in the business of advising various mortgage investment entities. The key, says Ha, is through harnessing technology. “We use technology to enhance our ability to drive data out of our suitability assessments and, therefore, produce more holistic and accurate suitability assessments,” he said.“We use our data models to figure out whether a project fits within the time horizon or risk tolerance or investment concentration threshold of this one particular investor.We make it a point that our KYC [Know Your Customer] are done through what we call our
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 24, 2019 268   0   0   0   0   0
A 10-year agreement cemented between the governments of Canada and Alberta will give rise to more affordable housing units in the province over the next decade. The deal involves the investment of $678 million in the renewal and expansion of Alberta’s low-cost housing, with both governments contributing $339 million each for the long-term funding. The agreement – which will greatly support Alberta’s initiatives concerning housing repair, construction, and affordability – comes in addition to the more than $638 million in existing 10-year federal housing investments in Alberta, coursed through the Social Housing Agreement. The Liberal administration has invested almost $510 million in Alberta’s housing since November 2015.The oil industry crashes of recent years have hit the province’s home buyers and consumers particularly hard. Read more:Oil sector recovery propelling Western Canada’s rental homes[1] “The new agreement marks the beginning of a partnership that will be supported by long-term and predictable funding starting April 1, 2019,” the governments stated in the announcement. “Alberta’s first Affordable Housing Strategy was launched in 2017 with the goal of building and renewing 4,100 units, and that goal is about to be achieved and exceeded.This new agreement means Alberta can continue our bold approach to address the housing needs of Albertans,” Alberta Minister of Seniors and
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 24, 2019 277   0   0   0   0   0
Major high-rise office projects accommodating more tech tenants and greater commercial investment volume are scheduled to commence soon in Toronto and Vancouver. Leading developers Allied Properties REIT and Westbank have announced that the construction of the office towers – which are predicted to “reshape” these markets’ downtown areas – will pave the way for greater tech industry presence in Canada’s largest markets. Tech companies have been cited by observers like Marcus &Millichap as a major pillar of stability form the office property sector. In Toronto, the 264-metre, 1.7-million-square-foot Union Centre building will be built near Union Station. “[Union Centre] is a sign of what Toronto is becoming,” Westbank chief executive Ian Gillespie told The Globe and Mail.“The city isn’t just about finance any more.It’s about everything:tech, culture and a variety of other pursuits.” Read more:Commercial property market heavily leans upon tech companies[1] In Vancouver, Allied Properties REIT and Westbank will be erecting a 500,000 sq.ft.tower beside BC Place.This project is expected to become one of the city’s largest office buildings so far. Tech’s influence in Canadian commercial real estate has been predicted to grow even stronger in the near future, with major players like Microsoft, Google, and Amazon likely spending billions in office expansions and hire tens
 
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Jarek Bucholc ||Street Smart RE InvestingJarek Bucholc ||Street Smart RE Investing   March 21, 2019 218   0   0   0   0   0
Montreal’s luxury housing market is expected to be the strongest of the spring season. According to a new report from Sotheby’s International Realty Canada[1], the city’s hot real estate market shows nary a sign of regressing.On the heels of a 20% year-over-year increase in sales over $1 million in 2018, Sotheby’s expects a sales record this spring. “With strong economic and political fundamentals driving local confidence and demand, top-tier sales escalated in the first two months of 2019,” read the luxury housing report.“Overall, $1m-plus residential real estate sales (condominiums, attached and single-family homes) were up 6% year-over-year to 111 units sold in January and February.Two luxury properties sold over $4m during this time, up from zero the same months in 2018.” Of particular significance, luxury condos in Montreal surged 53% year-over-year through January and February 2019.During January alone, transactions in Montreal totalled $1.63 billion, which is an 18% lift over the same month in 2018. “We expect the Montreal market to continue with its very healthy year-over-year increase in activity,” Sotheby’s[2] President and CEO Brad Henderson told CREW.“It will add somewhat to the upper pressure to price, particularly in the central region.We don’t see risk to that forecast, with the possible notable exception of a foreign buyer tax,
 
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