Chinese Buyers Turning from Vancouver Real Estate – Except at High End: Report – REW.ca
A study conducted by Sotheby’s International Realty Canada and Chinese housing portal Juwai.com revealed that not all Chinese foreign nationals are snapping up expensive single-family property, especially now that the foreign buyer tax is in place. REW.ca reported on the findings, including a declining interest in the Vancouver market.
The report said, “In Vancouver, [Chinese buyers’] property enquiries for real estate over $1 million fell 67 per cent year-over-year in the third quarter of 2016, in the month the 15 per cent foreign buyers’ tax was implemented, but rebounded with an 18 per cent year-over-year increase in the last quarter.”
The report also dispelled the notion that Chinese buyers are primarily interested in high-end homes. The property inquiry data from Juwai.com revealed that 57 per cent of the site’s property enquiries for Vancouver, 67 per cent for Calgary, and 68 per cent for both Toronto and Montreal fell below $655,050 ($500,000 USD) in 2016.
“The median prices for Juwai.com property enquiries – $590,200 in Vancouver, $531,115 in Calgary, $458,928 in Toronto and $488,012 in Montreal– were within the range of, and in some cases, significantly below the average sale price of residential real estate within the market,” noted the authors.
The survey also revealed the reasons cited by Chinese buyers for investing in Canadian real estate, also broken down by key cities.
Education was the most commonly cited motivation for Chinese interest in Vancouver real estate, cited by 44 per cent Juwai.com property hunters. This was followed by investment at 26.8 per cent and “own use” at 25 per cent.
Office, industrial space stacked in East Vancouver – Business in Vancouver
As available new stock of commercial real estate becomes more and more finite, a developer in East Vancouver is thanking his lucky stars he had the foresight to snap up an old industrial site years ago. Frank O’Brien, editor of Western Investor, reports that the space, transitioned into mixed-use, is now pre-selling at an impressive level.
This week, as city and company officials symbolically broke ground on the mixed-use Ironworks project, half of the floor space had already sold at $330 to $600 per square foot, and Conwest was beating investors off with a stick.
The site, at 200 Victoria Drive just north of East Hastings Street, falls under a 2009 spot zoning initiative of the City of Vancouver that allows higher density for job-generating projects in East Vancouver.
Conwest, itself a Vancouver-based firm, quickly discovered there was pent-up demand for such strata commercial space from a wide range of local industrial and office tenants.
City considering allowing character houses to be converted to multi-unit homes – Business in Vancouver
The City of Vancouver is considering transitioning single-family character homes in to multi-unit residences to prevent demolitions and provide more rental spaces, Business in Vancouver reports. But will it lead to affordable housing, or just more housing?
"We heard from a lot of people," the city's chief planner Gil Kelley told city council Tuesday of the public consultation process. "We basically heard both strong support for retention of character homes, but also equally strong support for incentives to provide more ability for alternative housing types and what we might call 'gentle density infill' in those same neighbourhoods."
The idea, or incentive for owners, still has to be approved by council, which will receive a staff report in April on recommendations to retain what's left of the city's character homes. Staff told council a new unit or units added to a character home could be for family use, rental or potentially strata-titled.
The city's definition of a character home is that it must have been built before 1940, meet criteria for "original features" and is not listed on the Vancouver heritage register.
City staff conducted a review of character homes in response to growing public concern about the loss of such homes to large new developments, largely on the West Side of the city.
Vision Coun. Geoff Meggs said he was concerned that creating affordable housing options — by allowing owners of character homes to increase their floor size — may still result in expensive housing.
"I think one of the disappointments about the laneway housing program is that although it does produce rental, which I think is accessible to more families than a new purchase, it's expensive to build and the rents are pretty high," Meggs said.
Canada’s red hot real estate heats up apartment market to heights not seen in 30 years – Financial Post
To add insult to injury, The Financial Post reports on Canada’s hot housing market as it continues to force consumers around the country out of the ownership market and into the rental apartment market. The story quotes an Avison Young report that says the tight vacancy rate has driven rental prices to record-breaking heights. Vancouver once again leads to pack.
Vancouver is probably the hottest market in the country, as rental apartment valuations operate in the shadow of the housing market. CBRE had them pegged as low as 2.75 per cent for multi-family Class A high-rise units in its year end report but that percentage is partially a function of speculators banking on converting property to residential ownership while also considering the possibilities of adding density to their land or hiking rents.
“Record housing prices guaranteed that multi-family assets would react in kind,” said CBRE, in its report, referring to Vancouver prices.
Lobo says as house prices continue to rise, he believes more and more of the population will switch to rental. “With housing prices the way they are, we are going to lock out people from the market like in New York. In New York, rich people rent because they just can’t afford to buy something.”
He adds that more supply — even the high-end projects being built today — should be good for tenants over time. “What it does is pushes down the market. You’re taking someone out of another rental and bringing them into (a higher end) unit,” says Lobo. “You’re also going to see a massive amount of customer service come back to the industry if landlords have to compete for tenants.”