Confidence remains high especially in the housing market… Wealthy Canadians are attracting more luxury brands to our malls… Iconic building seeks Asian buyers… And south of the border the market stays bumpy.
Confidence remains high as Canadians ignore talk of a bubble
The housing market has once again kept optimism high for Canadians. The Bloomberg Nanos Canadian Confidence Index has been at its highest for four years recently and while many experts may sound a cautious note for real estate, homeowners are less worried. The index isn’t just about housing; job security and other economic factors feature too, but it’s the housing market that is driving the positive note. The number of respondents who expect house prices to rise in the next six months was 44.4 per cent last week; down slightly on the week before. There was also a slight increase in the percentage expecting a decline in house prices in the next half year. With confidence generally high though, there is no suggestion of a slowdown in the market just yet! Read the full story.
Wealthier Canadians bring luxury to our neighbourhoods
Luxury brands have been increasing their presence in Canada over the last few years and the prediction is for more to come. Commercial real estate firm CBRE Group says that its research shows low vacancy rates in the most sought after neighbourhoods and its calling for more malls. Jewellery and designer fashion are among the retail sectors demanding more space in our cities and existing malls in Vancouver and Toronto are expanding to feed the demand. The rise in spending on luxury goods is not universal of course, but growing numbers of Canadians are moving up the income bands (often due to property investments rather than wages) and tourism is also fuelling the demand. Read the full story.
Concerned about foreign investment in our real estate? This won’t help!
When discussions about a housing bubble are taking place, the impact of foreign investment is never far away. Although the forthcoming CMHC report on condo investments is unlikely to show the percentage of foreign investment in our major cities, it has been increasing here and in most major western cities. Chinese investors in particular, with their own housing market weak, have been putting their money into western markets, and it seems that some developers are going direct to those buyers. The iconic Vancouver House, a $500 million, 52-storey development is being actively targeted towards Asian investors. According to the South China Morning Post, two sales offices for the project have been opened in Hong Kong and sales agents have been searching for buyers in China’s cities. With Vancouver house set to become one of the country’s most expensive properties, finding enough domestic buyers may not be possible but the concern is not overseas buyers who are using property here, but those buying and leaving them empty; good for their investment portfolio but not so good for our neighbourhoods or the market. Read the full story.
US housing market slow
New figures released yesterday by the National Association of Realtors show that the US housing market is struggling for recovery. The Pending Home Sales Index fell 1.1 per cent for contracts signed last month, a greater decline than had been expected. This follows a few months of growth. Other recent stats have also been disappointing; new home sales and housing permit applications were both down in the latest figures, although resales were at an eight month high. Read the full story.
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