There has been a surge of interest in Canadian real estate from south of the border following Donald Trump’s election as US president.
A report from real estate brokerage Royal LePage reveals that searches on its portal from the US increased 329 per cent on the day after the election and in the week following there was a 210 per cent year-over-year rise.
For the whole of November, American’s eyeing a move to Canada increased more than 70 per cent compared to the same month of 2015 and there was a 40 per cent increase for the whole of the fourth quarter.
"Always a desirable destination for migrants, Canada's attractiveness as a country for international relocation has surged this decade," said Phil Soper, president and chief executive officer, Royal LePage. "The United States was already a top source for immigration into Canada, and now in the period following the recent U.S. election, we are witnessing a material bump in American interest in Canadian real estate."
Ontario, British Columbia and Quebec are the most searched regions for potential homebuyers from the US. While some of the search increase is for commercial property, residential searches accounted for three quarters of the total.
"Given America's vast population, even a fractional increase in the number of households following through on this initial interest and successfully completing the demanding process of emigrating to Canada could drive a material increase in the number of home-buyers from south of the border," concluded Soper. "Our federal government is seriously considering increasing the quota of new Canadians welcomed from abroad, and with the high value of the U.S. dollar increasing Americans' purchasing power, we may be seeing more moving trucks with U.S. license plates in our future."
Source: http://www.canadianrealestatemagazine.ca/market-update/trump-effect-us-searches-for-canadian-real-estate-surge-219919.aspx
Monday, January 23, 2017
Monday, January 16, 2017
Consumers more accepting of mortgage robo-advisors
The disruptive influence of technology is highlighted by a new survey which shows growing acceptance of so-called robo-advisors.
The global poll which includes the US and Canada, by professional services firm Accenture, reveals that seven out of ten consumers welcome the idea of using automated advice services but there are still important roles for humans!
Robo-advice is most accepted for investments (78 per cent), choosing insurance products (74 per cent) or a bank account (71 per cent) but for mortgage advice, most respondents (61 per cent) said they would prefer to deal with a human advisor.
“While financial institutions may expect to benefit from internal cost reduction by providing customers with a ‘robo’ option, our research found that consumers also expect first-class human interaction,” said Piercarlo Gera, senior managing director, Accenture Financial Service.
As well as for mortgages, most consumers would also prefer to deal with a person for complaints (68 per cent).
The survey also reveals that consumers are becoming more open to buying financial products from non-traditional outlets with almost a third saying they would consider getting financial advice from Google, Facebook or Amazon.
While the Canadian responses show that 56 per cent are willing to use a robo-advisor, Gera says the future appears to be a hybrid model.
“Successful financial services firms will therefore need a "phygital" strategy that seamlessly integrates technology, branch networks and staff to provide a service that combines physical and digital capabilities and gives consumers a choice," he concluded.
http://www.canadianrealestatemagazine.ca/market-update/consumers-more-accepting-of-mortgage-roboadvisors-219514.aspx
The global poll which includes the US and Canada, by professional services firm Accenture, reveals that seven out of ten consumers welcome the idea of using automated advice services but there are still important roles for humans!
Robo-advice is most accepted for investments (78 per cent), choosing insurance products (74 per cent) or a bank account (71 per cent) but for mortgage advice, most respondents (61 per cent) said they would prefer to deal with a human advisor.
“While financial institutions may expect to benefit from internal cost reduction by providing customers with a ‘robo’ option, our research found that consumers also expect first-class human interaction,” said Piercarlo Gera, senior managing director, Accenture Financial Service.
As well as for mortgages, most consumers would also prefer to deal with a person for complaints (68 per cent).
The survey also reveals that consumers are becoming more open to buying financial products from non-traditional outlets with almost a third saying they would consider getting financial advice from Google, Facebook or Amazon.
While the Canadian responses show that 56 per cent are willing to use a robo-advisor, Gera says the future appears to be a hybrid model.
“Successful financial services firms will therefore need a "phygital" strategy that seamlessly integrates technology, branch networks and staff to provide a service that combines physical and digital capabilities and gives consumers a choice," he concluded.
http://www.canadianrealestatemagazine.ca/market-update/consumers-more-accepting-of-mortgage-roboadvisors-219514.aspx
Thursday, January 12, 2017
Stricter Chinese money rules might stifle foreigner influx into Canada
The Chinese government’s new, stricter rules on money exchange may have a domino effect on the foreigner-dependent Canadian housing sector.
Beginning this month, mainland authorities will now be requiring documents providing details on the reasons for yuan conversion, and when the money will be used. Improper use of the converted funds (e.g. the purchase of a residential property) will entail stiff penalties such as being banned from exchanging money for a significant duration, The Globe and Mail reported.
The stricter guidelines represent the culmination of Chinese authorities’ months-long effort to moderate the outbound flow of funds, which experts said has massively depleted the government’s foreign reserves over the past few years.
Economist Andy Xie warned that the regulatory revision will lead to a “sharp” decline in housing markets dependent on foreign capital like Canada—a dangerous proposition when one of the nation’s erstwhile hottest cities (Vancouver) has already reached peak sales volume and prices in spring 2016.
However, Real Estate Board of Greater Vancouver president Dan Morrison said that it will still take some time until the effects of this development become apparent.
“There are so many factors in the housing market,” Morrison stated. “Vancouver is not a homogeneous market. Some people want to point to one easy problem or one easy solution, and there is no such thing.”
http://www.canadianrealestatemagazine.ca/news/stricter-chinese-money-rules-might-stifle-foreigner-influx-into-canada-219382.aspx
Beginning this month, mainland authorities will now be requiring documents providing details on the reasons for yuan conversion, and when the money will be used. Improper use of the converted funds (e.g. the purchase of a residential property) will entail stiff penalties such as being banned from exchanging money for a significant duration, The Globe and Mail reported.
The stricter guidelines represent the culmination of Chinese authorities’ months-long effort to moderate the outbound flow of funds, which experts said has massively depleted the government’s foreign reserves over the past few years.
Economist Andy Xie warned that the regulatory revision will lead to a “sharp” decline in housing markets dependent on foreign capital like Canada—a dangerous proposition when one of the nation’s erstwhile hottest cities (Vancouver) has already reached peak sales volume and prices in spring 2016.
However, Real Estate Board of Greater Vancouver president Dan Morrison said that it will still take some time until the effects of this development become apparent.
“There are so many factors in the housing market,” Morrison stated. “Vancouver is not a homogeneous market. Some people want to point to one easy problem or one easy solution, and there is no such thing.”
http://www.canadianrealestatemagazine.ca/news/stricter-chinese-money-rules-might-stifle-foreigner-influx-into-canada-219382.aspx
Monday, January 9, 2017
Kitchener-Waterloo housing market has unprecedented year
Sales of homes in the Kitchener-Waterloo region in 2016 were up by 1,000 compared to the previous year.
The 18.1 per cent increase meant that 6,655 homes were sold through the MLS system of the Kitchener-Waterloo Association of Realtors while the total dollar volume was up 30.9 per cent to $2,578,176,468.
“2016 was marked by unrelenting demand for homes, in the face of fewer homes being put on the market,” said James Craig, President of the KWAR.
The average sales price of all residential properties sold in 2016 increased 10.8 per cent to $387,404 in comparison to 2015.
And for the year ahead?
“Mortgage rates remain low, inducing more consumers to get into the market. Home prices remain affordable when compared to the average GTA prices,” said Craig.
The challenge for the market, he says is that inventory remains low as many would-be sellers are staying in their homes longer with some put off moving up due to the hot market.
“What I hope to see is more balance returning to the market, because I sure don’t see the appetite for home ownership in Waterloo region letting up anytime soon,” Craig concluded.
Source: http://www.canadianrealestatemagazine.ca/market-update/kitchenerwaterloo-housing-market-has-unprecedented-year-219204.aspx
The 18.1 per cent increase meant that 6,655 homes were sold through the MLS system of the Kitchener-Waterloo Association of Realtors while the total dollar volume was up 30.9 per cent to $2,578,176,468.
“2016 was marked by unrelenting demand for homes, in the face of fewer homes being put on the market,” said James Craig, President of the KWAR.
The average sales price of all residential properties sold in 2016 increased 10.8 per cent to $387,404 in comparison to 2015.
And for the year ahead?
“Mortgage rates remain low, inducing more consumers to get into the market. Home prices remain affordable when compared to the average GTA prices,” said Craig.
The challenge for the market, he says is that inventory remains low as many would-be sellers are staying in their homes longer with some put off moving up due to the hot market.
“What I hope to see is more balance returning to the market, because I sure don’t see the appetite for home ownership in Waterloo region letting up anytime soon,” Craig concluded.
Source: http://www.canadianrealestatemagazine.ca/market-update/kitchenerwaterloo-housing-market-has-unprecedented-year-219204.aspx
Friday, January 6, 2017
Canadian housing to become even more attractive to foreigners
While Canadian real estate has long been attractive to enterprising Asians and Europeans who are looking to invest or park their wealth into overseas housing, an analyst stated that the long-running loonie-greenback exchange rate might make homes in Canada even more enticing for foreigners.
Vestcap Investment Management senior portfolio manager Lyle Stein recently argued that the low Canadian dollar could draw in a greater volume of foreign capital this year.
“When your dollar is low you become on sale and smart investors with all this liquidity that is coming out of the bond market and looking for a home, why not own a home in Toronto, a home in Vancouver or a home in Ottawa as an alternative asset -- and that is what we are seeing,” Stein told BNN.
The increased dependence of the national economy on the health of the real estate segment might prove fatal to the floundering loonie, however.
“When you look at the Canadian economy I was stunned that seven per cent of the economy is related to housing and housing-related activity and it has been like that for the past seven or eight years; if that starts to slow we are losing one of the key growth drivers in our economy and I think that is also coming into the fray,” Stein explained. “We are putting a lot of responsibility on a very narrow sector and that to me is the bigger problem.”
In particular, a dire warning from Royal LePage—which predicted major double-digit decreases in Vancouver home prices this year—emphasized the crucial role that recent government interventions are playing on this vital cornerstone of the economy.
The B.C. government imposed its 15 per cent foreign buyers’ tax in mid-2016. Combined with far-reaching revisions to federal mortgage rules late last year, a growing number of observers and industry professionals are voicing out concerns that the Canadian residential real estate sector is poised for a significant fall.
“Twenty years ago we were talking about a low loonie and how great it was for manufacturing. We actually had a manufacturing economy back then and we do not have that today [and] what replaced manufacturing, particularly in Ontario, has been the strength in our housing market,” Stein concluded.
“If we lose strength… we could really pull the rug out from under the only pillar that is working in Ontario right now.”
Source: http://www.canadianrealestatemagazine.ca/news/canadian-housing-to-become-even-more-attractive-to-foreigners-219181.aspx
Vestcap Investment Management senior portfolio manager Lyle Stein recently argued that the low Canadian dollar could draw in a greater volume of foreign capital this year.
“When your dollar is low you become on sale and smart investors with all this liquidity that is coming out of the bond market and looking for a home, why not own a home in Toronto, a home in Vancouver or a home in Ottawa as an alternative asset -- and that is what we are seeing,” Stein told BNN.
The increased dependence of the national economy on the health of the real estate segment might prove fatal to the floundering loonie, however.
“When you look at the Canadian economy I was stunned that seven per cent of the economy is related to housing and housing-related activity and it has been like that for the past seven or eight years; if that starts to slow we are losing one of the key growth drivers in our economy and I think that is also coming into the fray,” Stein explained. “We are putting a lot of responsibility on a very narrow sector and that to me is the bigger problem.”
In particular, a dire warning from Royal LePage—which predicted major double-digit decreases in Vancouver home prices this year—emphasized the crucial role that recent government interventions are playing on this vital cornerstone of the economy.
The B.C. government imposed its 15 per cent foreign buyers’ tax in mid-2016. Combined with far-reaching revisions to federal mortgage rules late last year, a growing number of observers and industry professionals are voicing out concerns that the Canadian residential real estate sector is poised for a significant fall.
“Twenty years ago we were talking about a low loonie and how great it was for manufacturing. We actually had a manufacturing economy back then and we do not have that today [and] what replaced manufacturing, particularly in Ontario, has been the strength in our housing market,” Stein concluded.
“If we lose strength… we could really pull the rug out from under the only pillar that is working in Ontario right now.”
Source: http://www.canadianrealestatemagazine.ca/news/canadian-housing-to-become-even-more-attractive-to-foreigners-219181.aspx
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