By Sheila Dabu Nonato, Postmedia NewsApril 12, 2012
Led by a growing number of young, single female buyers, “value-conscious” Canadians are helping to create a robust housing market, according to the Bank of Montreal’s spring housing report.
First-time buyers being drawn into the market by low interest rates and affordable housing, are attracted to convenient, urban living, said analysts on a conference call Thursday to discuss the report.
Among the major trends, experts highlighted single family homes, the condo boom and an urban lifestyle, where restaurants, subways, schools and work are within walking distance.
Conrad Zurini, broker of record at RE/MAX Escarpment Realty Inc., said a common thread across the country was the “value-conscious” first-time buyer.
Single women aged 18 to 34 now account for 20 per cent of all buyers, says Zurini, with a majority having a preference for “turn-key,” or ready-to-move-in, properties.
Among Canada’s largest cities, Calgary and Ottawa saw the biggest gains in housing sales in March, according to BMO data — up 12 per cent from March 2011 — while Toronto sales gained 7.8 per cent year-over-year. Prices fell in Edmonton and Victoria, as well as in previously booming Vancouver, where they were down 30 per cent from a year ago, said Katie Archdekin, BMO’s head of mortgage products. Prices rose “moderately” in most major cities, ranging from one to five per cent above 2011 values, she said.
“With Vancouver now well back from peak activity, Toronto is definitely the market to watch,” she said.
Houses spend the least time on the market — 29 days — in Regina, where new jobs have been fuelling market confidence, Zurini says.
BMO data suggests that New Brunswick housing prices increased 3.6 per cent since last February, with sales up 5.5 per cent during the same period.
Toronto’s surging condo market has been dominating provincial and national housing sales and starts data — a 50.4 per cent increase in multiple-unit starts in Ontario in March was due entirely to Toronto condo figures, and the national five per cent increase in housing starts was largely attributable to the same source, according to Canada Mortgage and Housing Corp. data released Wednesday.
Paul Maranger, senior vice-president of Sotheby’s International Realty Canada, said the boom in the luxury single-family home and condo markets continues to be strong, especially in Toronto where it is fuelled by the “significant void” in supply for single family homes.
Most buyers in Toronto are looking for convenience, not value, he added, with many who work in the financial district, law and medicine and are “time-strapped, working incredible hours in the office.”
“They’re willing to pay a substantial premium to not have to do any work (to find a home),” he said.
They are also looking at downsizing, choosing smaller homes in urban centres that offer a convenient lifestyle.
“Luxury does not necessarily equate to space,” he said.
Calgary is also seen as a “developing market” in the high-end housing market, Maranger said, and Vancouver continues to experience strong luxury demand in the western side of the city.
Another factor fuelling the strong Canadian buying market is foreign buyers from China and the Middle East, with most seeking to “park” capital, instead of renting out their property, Maranger said.
Zurini adds that part of the housing boom is also being influenced by the large wave of immigrants to Toronto, who are coming “with money, well-educated and looking at home ownership.”
The booming luxury housing market, Maranger suggested, may continue in Toronto in the mid- to long-term because of its “strong base” of high-income households who work in finance, law and health care.
There has been a “significant uptick” in sales of more than $2 million in Toronto’s central core compared to last year, said Maranger, adding that sales offers for housing at less than $2 million are also “unbelievably active” this year. A home in Toronto’s pricey Summerhill area sold for $370,000 more than its asking price, he said.
Meanwhile, in Quebec, Sotheby’s sold a $23-million property to buyer from Singapore, he noted.
Source: The Vancouver Sun