Thursday, July 29, 2010
Laneway housing takes form in affluent Edmonton neighbourhood
It was just recently that while viewing properties in Garneau very near the U of A where it's littered with income producing property, my client and I during a showing found ourselves looking back on to "laneway housing". Being that the street/neighborhood is zoned RF3 (RF3 allows for semi-detached housing with up to four units per building), this homeowner decided to take advantage by creating a residence above his/her garage. This infill (newly built home in an older neighborhood) is a prime example of the possibilities and/or potential uses of the current zoned RF3 application in the neighborhod. Although this residence is newly built, this picture keys in on expanding your horizons related to your current residence or acquiring a piece of real estate and creating value through its tangible land use zone application.
Vancouver housing market remains some of the most expensive real estate in Canada. With the lack of ability to build across far and wide, like what we have in Edmonton with our vast lands, Vancouver must build upwards rather than onwards. It is a bit of a problem as this inflates land values relating to minute purchasing power for homeowners (that is of course if you want to live the Vancouver lifestyle moreover than the suburbs like Burnaby, Coquitlam, Richmond, Surrey, etc.). The city has passed bylaw allowing for the creation and development of laneway housing. In contrast to the condo lifestyle, it provides for a unique and affordable style of living in an area where you might not ought to have before been capable of residing within.
Sunday, July 25, 2010
Bank of Canada raises key interest rate to 0.75%
Central bank issues gloomy outlook
Source: The Canadian Press
The Bank of Canada has hiked its trendsetting interest rate a quarter point to 0.75%, while issuing a more gloomy outlook for the economy and raising questions about where rates are headed next.
The second rate increase in as many months had been widely predicted by economists and markets, given Canada’s strong first quarter advance and recent job creation record.
The move will likely have an impact on variable mortgages as the big commercial banks usually adjust their prime rates shortly after the Bank of Canada adjusts its key lending rates.
The central bank’s move will raise some eye-brows among so-called bearish economists who had urged governor Mark Carney to keep interest rates steady if he believed the recovery was slowing.
They argued that raising rates at this time will onlhy weaken growth by discouraging consumer spending and business investment, and adding upward pressure on the loonie to the detriment of manufacturers and exports.
In a statement accompanying the announcement, the central bank’s governing council made clear that they did believe the economy’s growth was slowing.
The council said growth will be two-tenths of a point lower both this year and next -- at 3.5% and 2.9% respectively -- than it had thought in April.
And it said rather than returning to full capacity in the spring of 2011, the economy won’t be up to speed until the end of 2011, two full quarters later.
“This revision reflects a slightly weaker profile for global economic growth and more modest consumption in Canada,” the bank said.
It also noted that housing activity has declined “markedly,” and that while employment growth has resumed, “business investment appears to be held back by global uncertainties and has yet to recover from its sharp contraction during the recession.”
The bank said economic activity in Canada was still being led by government and consumer spending.
As for the global economy, the bank said there was still much to be concerned about.
The recovery was proceeding but was not yet self-sustaining. The debt overhang on governments, banks and households, it said, will temper the pace of growth.
And while the policy response has reduced some of the risk stemming from Europe’s sovereign debt crisis, that too will have an impact on the pace of global growth going forward. Meanwhile, the United States is seeing private demand pick up, but in an uneven way, it said.
Given the “considerable uncertainty ... any further reduction of monetary stimulus would have to be weighed carefully against domestic and global economic developments,” the bank added.
The next scheduled interest rate announcement is Sept. 8.
The central bank’s governing council did not expand on its reasoning for the rate hike other than to say it is consistent with achieving its 2% inflation target, and noting that at 0.75%, it considers monetary policy to be considerably stimulative.
It said inflation, the key responsibility for the central bank, is broadly in line with what it had expected and is expected to remain near the 2% target throughout the next two and a half years.
Although growth will be slower in the next two years, the bank did lift its projection for 2012 to 2.2% from the 1.9% it had earlier forecast.
Source: The Canadian Press
The Bank of Canada has hiked its trendsetting interest rate a quarter point to 0.75%, while issuing a more gloomy outlook for the economy and raising questions about where rates are headed next.
The second rate increase in as many months had been widely predicted by economists and markets, given Canada’s strong first quarter advance and recent job creation record.
The move will likely have an impact on variable mortgages as the big commercial banks usually adjust their prime rates shortly after the Bank of Canada adjusts its key lending rates.
The central bank’s move will raise some eye-brows among so-called bearish economists who had urged governor Mark Carney to keep interest rates steady if he believed the recovery was slowing.
They argued that raising rates at this time will onlhy weaken growth by discouraging consumer spending and business investment, and adding upward pressure on the loonie to the detriment of manufacturers and exports.
In a statement accompanying the announcement, the central bank’s governing council made clear that they did believe the economy’s growth was slowing.
The council said growth will be two-tenths of a point lower both this year and next -- at 3.5% and 2.9% respectively -- than it had thought in April.
And it said rather than returning to full capacity in the spring of 2011, the economy won’t be up to speed until the end of 2011, two full quarters later.
“This revision reflects a slightly weaker profile for global economic growth and more modest consumption in Canada,” the bank said.
It also noted that housing activity has declined “markedly,” and that while employment growth has resumed, “business investment appears to be held back by global uncertainties and has yet to recover from its sharp contraction during the recession.”
The bank said economic activity in Canada was still being led by government and consumer spending.
As for the global economy, the bank said there was still much to be concerned about.
The recovery was proceeding but was not yet self-sustaining. The debt overhang on governments, banks and households, it said, will temper the pace of growth.
And while the policy response has reduced some of the risk stemming from Europe’s sovereign debt crisis, that too will have an impact on the pace of global growth going forward. Meanwhile, the United States is seeing private demand pick up, but in an uneven way, it said.
Given the “considerable uncertainty ... any further reduction of monetary stimulus would have to be weighed carefully against domestic and global economic developments,” the bank added.
The next scheduled interest rate announcement is Sept. 8.
The central bank’s governing council did not expand on its reasoning for the rate hike other than to say it is consistent with achieving its 2% inflation target, and noting that at 0.75%, it considers monetary policy to be considerably stimulative.
It said inflation, the key responsibility for the central bank, is broadly in line with what it had expected and is expected to remain near the 2% target throughout the next two and a half years.
Although growth will be slower in the next two years, the bank did lift its projection for 2012 to 2.2% from the 1.9% it had earlier forecast.
Monday, July 19, 2010
Central bank expected to raise its key lending rate by a quarter percentage point Tuesday to 0.75%
The week ahead: Canadian investors look to Bank of Canada interest rate decision
Source: The Canadian Press
Canadian investors will look to the central bank’s interest rate decision for guidance this week, while U.S. markets are hoping earnings reports from a slew of major companies will help offset some abysmal economic data.
The Bank of Canada is expected to raise its key lending rate by a quarter percentage point Tuesday to 0.75%, another indication that Canada’s economic recovery has so far been stronger and faster than in the United States.
An interest rate hike by the Canadian central bank in a move to fight inflationary pressures in the economy could put some pressure on stock markets as they price in “greater odds of follow-up moves through October,” noted Avery Shenfeld, chief economist at CIBC World Markets.
News earlier this month that the Canadian economy created a whopping 93,200 new jobs in June, taking the country’s unemployment rate below 8% for the first time since the depths of the recession, “more or less put the lid on the question” of whether the central bank would hike interest rates, said Doug Porter, deputy chief economist at BMO Capital Markets.
“I wouldn’t say things are back to normal but they’re moving rapidly in that direction, at least in Canada,” Porter said.
“In that kind of environment, there is very little justification for extraordinarily low interest rates such as we still have in this country.”
Canadian businesses also helped pave the way for an interest rate hike in a key quarterly survey last week, indicating they were generally upbeat about the outlook for business activity over the coming year.
Half the firms surveyed by the Bank of Canada said they planned to add workers over the next 12 months, compared to only 10% that planned to cut their workforce.
Porter said he expects the central bank’s lending rate to reach 2.5% by the end of 2011. However, he added that he expects the central bank to continue using “very cautious language” for the time being.
While an interest rate hike and the Bank of Canada’s assessment of the economic recovery will impact investors, fallout from a slew of weak economic data in the U.S. will also weigh on markets this week.
Colin Cieszynski, market analyst at CMC Markets Canada, said Canada with its strong economy and low borrowing costs “is just about the only place where people are talking about raising interest rates.”
“Certainly in the U.S. they’re not, and in fact the Fed even said that if things slow down too much they’ll bring back more emergency measures.”
Major stock markets in Toronto and New York ended last week in the red following a much weaker-than-expected consumer confidence reading out of the U.S. on Friday, some uninspiring manufacturing data, soft retail sales numbers, a lower economic growth forecast from the Fed and a miserable jobs report for June.
Housing data out of the States this week could continue to pressure markets. Housing starts, due out on Tuesday, are projected to drop 5% for June, while existing home sales, which will be reported Thursday, are expected to fall 10% for the same month.
“I think we’re back to where we were about a year ago in terms of expectations for the recovery,” Porter said.
“Economists, analysts, the markets all have come to grips with the reality that we are coming back down to earth.”
However, the impact of weakening housing data could be mitigated if major companies slated to report earnings next week are able to impress, Cieszynski said.
“Right now you’ve still got a bit of fear out there, but if you do start to see large numbers of positive surprises pile up again, it should help to stabilize the markets,” he said.
Source: The Canadian Press
Canadian investors will look to the central bank’s interest rate decision for guidance this week, while U.S. markets are hoping earnings reports from a slew of major companies will help offset some abysmal economic data.
The Bank of Canada is expected to raise its key lending rate by a quarter percentage point Tuesday to 0.75%, another indication that Canada’s economic recovery has so far been stronger and faster than in the United States.
An interest rate hike by the Canadian central bank in a move to fight inflationary pressures in the economy could put some pressure on stock markets as they price in “greater odds of follow-up moves through October,” noted Avery Shenfeld, chief economist at CIBC World Markets.
News earlier this month that the Canadian economy created a whopping 93,200 new jobs in June, taking the country’s unemployment rate below 8% for the first time since the depths of the recession, “more or less put the lid on the question” of whether the central bank would hike interest rates, said Doug Porter, deputy chief economist at BMO Capital Markets.
“I wouldn’t say things are back to normal but they’re moving rapidly in that direction, at least in Canada,” Porter said.
“In that kind of environment, there is very little justification for extraordinarily low interest rates such as we still have in this country.”
Canadian businesses also helped pave the way for an interest rate hike in a key quarterly survey last week, indicating they were generally upbeat about the outlook for business activity over the coming year.
Half the firms surveyed by the Bank of Canada said they planned to add workers over the next 12 months, compared to only 10% that planned to cut their workforce.
Porter said he expects the central bank’s lending rate to reach 2.5% by the end of 2011. However, he added that he expects the central bank to continue using “very cautious language” for the time being.
While an interest rate hike and the Bank of Canada’s assessment of the economic recovery will impact investors, fallout from a slew of weak economic data in the U.S. will also weigh on markets this week.
Colin Cieszynski, market analyst at CMC Markets Canada, said Canada with its strong economy and low borrowing costs “is just about the only place where people are talking about raising interest rates.”
“Certainly in the U.S. they’re not, and in fact the Fed even said that if things slow down too much they’ll bring back more emergency measures.”
Major stock markets in Toronto and New York ended last week in the red following a much weaker-than-expected consumer confidence reading out of the U.S. on Friday, some uninspiring manufacturing data, soft retail sales numbers, a lower economic growth forecast from the Fed and a miserable jobs report for June.
Housing data out of the States this week could continue to pressure markets. Housing starts, due out on Tuesday, are projected to drop 5% for June, while existing home sales, which will be reported Thursday, are expected to fall 10% for the same month.
“I think we’re back to where we were about a year ago in terms of expectations for the recovery,” Porter said.
“Economists, analysts, the markets all have come to grips with the reality that we are coming back down to earth.”
However, the impact of weakening housing data could be mitigated if major companies slated to report earnings next week are able to impress, Cieszynski said.
“Right now you’ve still got a bit of fear out there, but if you do start to see large numbers of positive surprises pile up again, it should help to stabilize the markets,” he said.
Monday, July 5, 2010
Edmonton housing market marked by high inventory
REALTORS® report normal client activity in the Edmonton real estate market with listings, showings and sales. The residential inventory is approaching record levels set in 2007 but prices held steady in the second quarter with the expectation that they will soften as usual through the fall and early winter.
“There was less external pressure on the market from incentives or rate changes last month and as a result the market seems to be operating in a normal controlled manner,” said Larry Westergard, president of the REALTORS® Association of Edmonton. “It has been quiet on the news front but very busy in REALTORS® offices as they list client’s properties for sale, book showings for buyers and attend open houses. This has not resulted in immediate sales, however, and, in anticipation that this slowdown will continue through the year, we have reduced our 2010 sales forecast by 2,000 units from 21,000 to just 19,000.”
The slight rise in prices for single family residences in the Edmonton area in May continued in June. SFD prices are up to $391,497 – an increase of half a percent. In the first half of the year average prices are up over 7.5% and are tracking higher than 2009. Condominium prices peaked in April and then flattened out to match the prices reported in 2009. In June the average condo sold for $242,644 – down 2.4% month-over-month. Duplex and rowhouse prices of $306,905 were down 4.6% from last month. Overall, the average residential price was down $4,795 in a month. As usual prices are expected to soften in the second half of the year as sales activity slows. “With the increased choices that buyers have in the marketplace right now it is that much more imperative that sellers consult with their REALTOR® to make sure their property is priced to attract an offer,” said Westergard.
There were 9,406 residential properties in inventory at the end of June as a result of 3,473 new residential listings and sales of 1,539 properties. The sales-to-listing ratio was 44%. The average days-on-market was up at 47 days. The record inventory levels were set in September 2007 at 9,913 residential properties available through the Edmonton MLS® System.
“External influences pulled sales activity into the first four months of the year which reduced the demand in May and June. Overall there were 680 less residential sales in the first half of the year as compared to 2009,” said Westergard. “Consumers still seem interested in getting into the housing market or moving up but seem to be resting after a confusing period of uncertainty and change in the conditions that surround a property purchase.” He emphasised that despite seasonal changes the local market is stabilizing and operating in a normal manner. “The frenetic days of the past few years look to be behind us now and it appears that the more calm, cool and collected market that we are used to in Edmonton is on the horizon”.
“There was less external pressure on the market from incentives or rate changes last month and as a result the market seems to be operating in a normal controlled manner,” said Larry Westergard, president of the REALTORS® Association of Edmonton. “It has been quiet on the news front but very busy in REALTORS® offices as they list client’s properties for sale, book showings for buyers and attend open houses. This has not resulted in immediate sales, however, and, in anticipation that this slowdown will continue through the year, we have reduced our 2010 sales forecast by 2,000 units from 21,000 to just 19,000.”
The slight rise in prices for single family residences in the Edmonton area in May continued in June. SFD prices are up to $391,497 – an increase of half a percent. In the first half of the year average prices are up over 7.5% and are tracking higher than 2009. Condominium prices peaked in April and then flattened out to match the prices reported in 2009. In June the average condo sold for $242,644 – down 2.4% month-over-month. Duplex and rowhouse prices of $306,905 were down 4.6% from last month. Overall, the average residential price was down $4,795 in a month. As usual prices are expected to soften in the second half of the year as sales activity slows. “With the increased choices that buyers have in the marketplace right now it is that much more imperative that sellers consult with their REALTOR® to make sure their property is priced to attract an offer,” said Westergard.
There were 9,406 residential properties in inventory at the end of June as a result of 3,473 new residential listings and sales of 1,539 properties. The sales-to-listing ratio was 44%. The average days-on-market was up at 47 days. The record inventory levels were set in September 2007 at 9,913 residential properties available through the Edmonton MLS® System.
“External influences pulled sales activity into the first four months of the year which reduced the demand in May and June. Overall there were 680 less residential sales in the first half of the year as compared to 2009,” said Westergard. “Consumers still seem interested in getting into the housing market or moving up but seem to be resting after a confusing period of uncertainty and change in the conditions that surround a property purchase.” He emphasised that despite seasonal changes the local market is stabilizing and operating in a normal manner. “The frenetic days of the past few years look to be behind us now and it appears that the more calm, cool and collected market that we are used to in Edmonton is on the horizon”.
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