August 2020

All posts from August 2020

Seniors Can Look Forward to New Affordable Homes in Kamloops

by Bevony on August 26, 2020 No comments

Seniors can breathe a little easier now that they have more affordable housing to look forward to. Construction for a 37 unit project is underway to provide for the aging community, as a result, the project in Kamloops will provide rental housing to seniors. 

Seniors and their loved ones can now have the peace of mind that an affordable home provides. The Ministry of Municipal Affairs and Housing along with community partners are working to provide housing for people in Kamloops that are safe, good, and affordable. 

The houses are being built in partnership with the ASK Wellness Society along with the City of Kamloops. The new homes will be built at 1260 Hillside Ct. The building goes up to four stories and offers one-bedroom units to seniors with rental costs ranging from $375 to $825. 

Mayor Ken Christian is happy to see this move for more affordable housing for the seniors of the city. He notes, “Housing is a key area of focus for our council, and we continue to work with our partners to improve diversity and access throughout the housing continuum.”

The project is owned and operated by the ASK Wellness Society and the project will go by the name “Cookie’s Place.” The homes in this development will be co-located and operated alongside Maverick Manor which is also an ASK Wellness Society Development.  Their goal is to have people move from streets into homes, so they can regain their health and have better access to employment. 

The project is directed towards couples that are 55 years and older. This new development complements the Maverick Manor development that offers residents life-skills training, recovery services, as well as employment placements. 

Stakeholder Contribution

Both the Government and the BC Green Party caucus have shared the priority for delivering affordable housing. The BC Green Party Caucus is a partner of the Confidence and Supply Agreement.  

The development is being achieved through collaborative efforts from a number of stakeholders. The Land for the project was provided by the society. Along with that, the land values approximately $817,000. The City of Kamloops has also provided municipal waivers of $130,000. The province is additionally allotting 3.9 million dollars which are taken from the Building BC: Community Housing Fund. 

The project is expected to be complete and ready for the resident move-in for the fall of 2021. 

Kamloops “Cookie’s Place” Quick Facts 

The province has over 1,000 homes that are either underway or completed in Kamloops. Of these homes, 

  • 290 homes are allotted for moderate-income earners
  • 155 homes are allotted for persons who are currently experiencing homelessness
  • 44 homes are allotted for women and children who are in violent households
  • There are also an additional 533 beds that will be allotted for student housing

Additional Resources

Check out maps of the development here. You can also find information on how BC Housing is providing support to residents of British Columbia during the pandemic here.

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BevonySeniors Can Look Forward to New Affordable Homes in Kamloops

Private Mortgage Insurance Providers Seeing Growth

by Bevony on August 21, 2020 No comments

The Canadian housing market is at a very interesting point. The current housing market in Canada is one of the biggest in the world. As a matter of fact, the growth of 88% since 2005 makes Canada’s Housing market one of the highest growing markets of any other G7 country. 

The FIRE sector; Finance, Insurance, and Real Estate make up approximately 25% of the country’s GDP. Household debt to GDP has increased significantly over 100% of GDP. With the striking of the global pandemic crisis, what are policymakers to do now?

The current home ownership rate in Canada is approximately 69%, and we can see the wealth of Canadians now hanging in the balance. Evan Siddall, Canada’s Mortgage, and Housing corporation have expressed his concerns about the elevated levels of debt and the unsustainable increase in prices. He expresses that there is a possibility for home prices to fall between 9 and 18% based on the information from recent forecasts on the market. 

What Are Mortgage Lenders Doing?

Siddall made the decision to tighten lending standards in a bid to protect mortgage insurance providers that are taxpayer-backed. He is hoping that the other private mortgage lenders in Canada will follow his lead. But this is not what took place. 

Lenders have continued to issue new loans and are now directing their new business to the private insurers. Both private entities are of course happy about the growth they are experiencing, and we can’t fault them for that. They are only taking 10% of the risk as the government covers the other 90% of the loss. 

Siddall sees this as blind disregard and moral hazard. He recently wrote a letter to Canadian banks expressing his concern. His letter included the following request “… I’m asking for two things, first, we would hope you would reconsider highly leveraged household lending. Please put our country’s long-term outlook ahead of short term profitability. Second, please don’t aggravate the impact of undermining CMHC’s market presence unnecessarily.” 

Siddall’s letter was not well-received and was referred to by some bank execs as “alarmist and a bit extreme” but are we really surprised by all this?

What are your views on this matter? We’d love to hear them, please leave them in the comments below.

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BevonyPrivate Mortgage Insurance Providers Seeing Growth

Vancouver Mortgage Delinquencies: What Are The Numbers?

by Bevony on August 14, 2020 No comments
Mortgage Delinquencies on the Rise

 Even before the pandemic, there was a trend towards higher figures in Toronto and Vancouver. These two municipalities have seen record lows in 2018 and prior. But the mortgage delinquency numbers across Canada, on the whole, are rising. 

Better Dwelling tracks the Canadian Real Estate Market. The Better Dwelling entity was founded by Stephen Punwasi, who is an analyst. They indicate that mortgage delinquencies are rising. 

How are Mortgage Delinquencies Measured?

In Vancouver, mortgage delinquencies are measured by looking at the number of mortgages that are overdue for more than 90 days. In the first quarter of 2020, this number reached 0.13%. These numbers show an increase over the same quarter for 2019, rising from a percentage rate of 0.1% in 2018. 

In Toronto, the numbers are showing a 10% increase between 2019’s first quarter and 2020’s first quarter. The first quarter’s last few weeks were the beginning of the pandemic and the start of lockdowns in Canada. But the trend towards higher numbers was already established in Toronto and Vancouver before this, so we can’t say COVID-19 is to blame. 

What is a Mortgage Delinquency Anyway?

Mortgage delinquency refers to how quickly a home can be converted to its cash value. When the market is hot, homes are selling rapidly. So owners who cannot make their payments can typically, list their home, get an offer and close within three months. If this model is in play in the market, the delinquency rates are kept low. When the process takes longer, then the prices get higher.  

Better Dwelling notes that the market as it stands is stalling. The longer it takes to make a sale, the more the delinquencies will rise. With high default rates, many homeowners are unable to exit their real estate in a fast manner.

Steve Saretsky, a realtor in Vancouver, notes that the change in a rising and falling delinquency rate is something we should be watching into 2021. Saretsky thinks the foreclosure rate will also increase in the next couple of years and that the process will be very long and drawn out for British Columbia. In a recent report he notes that “From the time you miss a mortgage payment to the time the house sells in court, it takes an average of between 12 to 15 months,”

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BevonyVancouver Mortgage Delinquencies: What Are The Numbers?

Steady Activity for the Metro Vancouver Housing Market this Summer

by Bevony on August 7, 2020 No comments

The July 2020 buyer and seller activity for Metro Vancouver exceeded historical levels. This was published in the Real Estate Board of Greater Vancouver (REBGV)  monthly market report. The report indicates that the total residential home sales increased by 22.3 % from 2,557 sales in July 2019 to 3,128 sales in 2020. The increase in July was a 28% increase over June 2020, where 2,443 homes were sold compared to the 3,128 sold in July. In total, the sales for July 2020 were 9.2 % higher than the 10 year average for sales in July. 

REBGV Stats Graph July 2020
Image Credit: REBGV

Colette Berger, Chair at REBGV,  notes that these numbers are a result of the pent up activity that both home sellers and buyers have been holding in. Couple that with limited supply overall and lower interest rates makes the market more competitive. 

The July 2020 Metro Vancouver MLS saw an addition of 5,948 attached, detached and apartment properties being listed. In July 2019 only 4,613 properties were listed so July 2020 is showing a 28.9 % increase in listings compared to the same month of 2019. In June 2020 a total of 5,787 homes were listed showing a 2.8% increase from the previous month as well. 

Currently, there are 12,083 properties listed for sale on the Metro Vancouver MLS system which is showing a decrease of 15.1% compared to the 14,240 properties that were on the list as of July 2019. The number is showing an increase though when compared to June 2020 which had a total of 11,424 properties listed. 

Reaching Potential HomeBuyers Despite the Restrictions

We understand that everybody must take new strides to ensure that social distancing is being observed. As such companies are using a variety of technology solutions to keep home buyers and sellers safe with their interactions. We are all trying to limit in-person interactions as much as possible. As much as can be done virtually is done to ensure the safety of our nation as a whole. 

Sales to Active Listings Ratios

For July 2020 we are seeing a sales to active listing ratio of 25.9% for all property types. We can further break that down by property type. Detached homes have a ratio of 25.1% while townhomes have a ratio of 31.1% and apartments have a ratio of 24.7%

REBGV Stats Graph July 2020
Image Credit: REBGV

The experts note that when the ratio dips to less than 12% for a sustained period is when there is downward pressure on home prices. On the flip side, home prices will rise when the ration passes 20% over a period of multiple months. 

The benchmark price for residential properties on the Metro Vancouver MLS Home Price Index is currently $1,031,400. This is showing an increase over July 2019 of 4.5% and an increase over June 2020 of 0.6%. 

Sales of Different Types of Properties 

Detached home sales reached 1,121 in July 2020 which was an increase of 33.3% over the detached home sales that were recorded (841) for July 2019. The benchmark price for detached homes is $1,477,800. This price is showing an increase of 5% from prices in July 2019 and 0.9% from prices in June 2020. 

Apartment home sales prices reached 1,400 in July 2020 showing an increase of 12.6% when compared to the sales(1,243) of July 2019. The benchmark price for apartments is currently at $682,500 indicating an increase of 4.2% from July 2019 and an increase of 0.3% when compared to June 2020. 

Home sales for Attached homes were at 607 for July 2020 indicating an increase of 28.3% over the 473 sales for July 2019. The benchmark price is $797,700 indicating an increase of 3.7% over prices at July 2019 and a 0.9% increase over prices at June 2020. 

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BevonySteady Activity for the Metro Vancouver Housing Market this Summer