Toronto Condo and Real Estate Blog

TORONTO, June 4 (Canada Newswire) - Short-term cyclical factors are consistent with a gradual cooling off in Canada’s real estate market over the next several years, according to the latest Real Estate Trends report released by Scotia Economics. At the same time, long-term fundamentals, including slower population growth, are expected to dampen the demand for real estate.

According to the report, the country’s average annual rate of population growth is projected to slow to just 0.8% over the coming decade, reflecting an aging society and historically low fertility rates.

“This less favourable demographic trend does not in itself pose a major risk to the real estate market outlook,” said Adrienne Warren, Senior Economist, Scotia Economics. “Real household income growth and the level of interest rates have a statistically more significant influence on housing sales and price appreciation.”

Yet the expected moderation in underlying housing demand comes at a time when affordability is at a cycle low, supply conditions are becoming better balanced and pent-up demand has largely been satisfied, potentially reinforcing the real estate industry’s more subdued prospects.

“Demographic shifts will also influence the type of housing in demand,” added Warren. “In particular, the changing age structure of the Canadian population and the growing significance of immigration will likely favour certain forms of real estate and certain geographical areas.”

The Canadian population aged 25-to-44 years - those with the highest probability of buying a home in any given year - is projected to increase by just 2% between 2006 and 2016, or by 195,000. All of the growth will come from the youngest in this cohort (aged 25-to-34 years), reflecting the maturing of the baby echo generation. “These buyers, many of them singles or young professional couples, should support continuing moderate demand for entry-level homes and condos, particularly in urban centres close to employment opportunities,” said Warren.

Meanwhile, the population aged 35-to-44 years (essentially the much smaller baby bust generation) is expected to decline in absolute numbers over the same period. This group encompass both first-time buyers and households in their early “trade-up” years. They are more likely to have young families and relative to their younger cohort, favour larger suburban homes, a real estate segment that could underperform.

At the same time, the number of Canadians aged 45-to-64 years is projected to rise by 15% (1.3 million) while Canadians 65 and over will jump by 65% (1.5 million). Even taking into account the higher level of real estate market activity of younger Canadians, the number of sales involving both late-stage “move up” buyers and “downsizers” could dominate those of more traditional homebuyers. Warren added, “While the lifestyles and housing needs of these more mature homeowners vary widely, an aging population should favour new construction over resales, lower maintenance options such as condos, second homes and vacation properties, and urban areas with greater amenities.”

“Immigration will also play an increasingly important role in shaping housing demand,” said Warren. “Immigration has been the dominant source of household formation since the early 1990s, a trend that will accelerate over the coming decade as the rate of natural population growth continues to slow.” Net international migration is expected to account for over two thirds of Canada’s population growth between 2006 and 2016, something not seen since Wilfrid Laurier was prime minister. Immigration could be Canada’s only source of population growth by about 2030.

Relatively weaker earnings growth vis-à-vis native-born Canadians is one possible factor behind the apparent difficulty faced by some recent immigrant households in making the transition from renter to homeowner. Recent policy initiatives to aid in assessing and recognizing foreign professional credentials will hopefully result in a better performance on this front. Immigrant families are also more likely than native-born Canadians to locate in major cities where homeownership rates in general are lower, and home prices higher.

However, the strong wave of immigration since the early 1990s remains an ongoing important supportive factor for the real estate market. Homeownership rates rise with the duration of residence, and is concentrated among foreign-born who have lived in Canada for 10 years or more, reflecting the time needed to accumulate the necessary savings.

“More than one third of foreign-born residents in Canada’s largest urban centres have been in Canada for ten years or less. This suggests a significant pool of potential homebuyers ready to enter the Canadian real estate market,” said Warren. “The “typical” homebuyer in the coming decade will not be as traditional as in the past, having more diverse social and demographic characteristics.”

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Menkes Developments has opened the doors of the presentation gallery for the new Four Seasons Private Residences Toronto project

From New Dream Homes and Condos Magazine

Over 300 VIP guests turned out for the Gala Opening of the Brian Gluckstein-designed Presentation Gallery for the new Four Seasons Private Residences Toronto. Honored guests included Toronto Mayor David Miller, Councilor Kyle Rae, and Isadore Sharpe, Chairman and Founder of Four Seasons Hotels.

Food at the invitation-only event was prepared by Four Seasons executive chef Robert Bartley and included such delicacies as Duck Poutine and Risotto with Truffles.

Located in Toronto’s exclusive Yorkville district at the northeast corner of Bay Street and Yorkville Avenue, Four Seasons Private Residences Toronto promises the same uncompromising commitment to quality and service that has made Four Seasons Hotels the world’s finest luxury hotel brand.

With access to renowned Four Seasons services and amenities, including a 28,000- square-foot spa, health club and pool facility, as well as 24-hour concierge, valet service, in-residence dining and housekeeping, residents at Four Seasons Private Residences Toronto will experience the height of luxury living.

The two towers have been designed by Peter Clewes of the prestigious Canadian design firm Architects Alliance. The West Residence will be a 55-storey tower at the southwest corner of the site that will contain a 253-room Four Seasons Hotel on the first 20 floors and 103 Private Residences above.

The East Residence, which will be connected to its sister tower by an elevated pedestrian bridge, will stand 25-storeys on the northeast portion of the property and contain 101 Private Residences. This building will also feature ground floor retail space fronting onto a landscaped courtyard.

The hotel and residential lobbies, spa, ballroom/conference facilities, and the hotel rooms will be designed by the award-winning firm of Yabu Pushelberg, while pre-eminent Canadian designer Brian Gluckstein has been retained for the Private Residences.

Residences range in size from 1,100 to nearly 9,000 square feet with prices ranging between $1.2 million and $16 million. The Presentation Gallery is open by appointment only.

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If you’re in college or university, or if you have just started a job, it’s most likely that home to you right now means a rental apartment, or even your parent’s house. But it’s never too early to start thinking about the future, so why not start now?

Here are five valuable tips to consider that will make your life easier when you do want to buy a home a few years down the road.

1. Establish good credit habits and a favorable credit history. Get a credit card and use it responsibly. Apply for an automobile loan and make your payments on time every month. If you’re renting an apartment, put your own name on the lease and the utility bills and make sure that the rent and the bills are paid every month. If you’re already struggling with credit card debt, or you have large student loans, get some free credit counselling now! Make a concentrated effort to pay your credit card and loan payments on time, every time.

2. Start saving for a down payment and closing costs. In high-cost areas like the Toronto real estate market, starting to save early can be enormously beneficial because you’ll get the advantage of compounding interest and have a longer period of time to grow your investments. Open a savings account or an investment account and make regular deposits and watch that down payment grow.

3. Read some books. Your local library and bookstore probably have at least a few shelves of books about financial management and buying real estate. Not all of them will have the best information, but after reading a few, you should be able to tell good advice from bad advice. The book “Rich Dad, Poor Dad” is excellent for this. Take notes, make a financial plan for yourself… you can learn a lot about real estate, budgeting and credit on the web too.

4. Research where you’d like to live. If you’re a dyed-in-the-wool Beacher who is rarely west of Yonge Street, or if you grew up in Mississauga and Toronto’s many neighbourhoods confound you - start exploring. There are a lot of neighbourhoods to choose from in Toronto and if you don’t know what they’re like, how are you going to know where you’d want to live? Take a few weekend walks (don’t just drive through) around different parts of the city and you may even discover a few hidden gems.

5. Ask your real estate agent relatives for advice. Parents, grandparents, aunts, uncles or older cousins who have purchased a house or condo can give you good information about the cost of housing in the area where you want to live and what it takes to buy a home. Ask them if housing affordable in this area? How much money would I need to save in order to buy a home? What advice would you give me about planning my financial future? Would you recommend some books that I might like to read about buying a home? Don’t be shy. If you have a question, ask someone in a position to know the answer.

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Contact the Jeffrey Team for more information