A new report from Re/Max Canada reveals that the detached housing market in the Greater Toronto Area (GTA), Greater Vancouver and Fraser Valley is being fueled primarily by investors and move-up buyers.

With first-time homebuyers increasingly priced out of these expensive markets, those looking to upgrade or invest in real estate have become the main drivers of sales activity in the first half of 2024.

‘The first (June’s) interest rate cut did little to incentivize buyers, but the second may have struck a nerve’

“While affordability remains the top obstacle for first-time homebuyers, more experienced buyers and investors are taking advantage of softer housing values, making their moves ahead of the Bank of Canada’s (BoC) end to quantitative tightening,” says Re/Max Canada president Christopher Alexander.

“Pent-up demand continues to build, with an estimated 20,000 to 25,000 buyers currently lying in wait in the GTA, and another 5,000 buyers in the Greater Vancouver area ready to pull the trigger. The first interest rate cut in June did little to incentivize buyers, but early indications show the second may have struck a nerve.”

The Re/Max Hot Pocket Communities Report found that nearly 40 per cent of the surveyed markets (33 out of 83) reported an increase in detached home values in the first six months of 2024, while 30 per cent of markets (25 out of 83) saw a rise in the number of sales. This indicates a robust demand for detached homes, even in the face of affordability challenges.

GTA: Sales momentum and price increases

In the GTA, the 416 area code (encompassing Toronto proper) has shown the strongest sales momentum. Just over 34 per cent of neighbourhoods there either remained stable or experienced growth in detached homebuying activity, outpacing the 905 area code as well as Greater Vancouver and Fraser Valley. This resurgence is particularly notable given the region’s challenging real estate landscape, where high prices have kept many first-time buyers on the sidelines.

Specific neighbourhoods in Toronto have seen notable increases in homebuying activity. Areas such as Dufferin Grove, Little Portugal, Trinity-Bellwoods and Rosedale-Moore Park have all reported significant gains in sales.

On the pricing front, the West End of Toronto has led the way with some of the highest increases in detached housing values. For example, neighbourhoods like Kingsway South and High Park North have seen prices rise by over 7.0 per cent to 9.0 per cent compared to last year.

Greater Vancouver and Fraser Valley: Limited inventory drives price appreciation

In British Columbia, limited inventory has been a critical factor supporting price appreciation in the detached home category, particularly in the Fraser Valley, with over 83 per cent of its local markets reporting an increase in average prices. This is followed closely by Greater Vancouver, where over 70 per cent of neighbourhoods have noted rising median values.

Areas such as Squamish, Burnaby and Port Coquitlam have experienced some of the largest price gains, with median home values increasing by as much as 14.2 per cent. Despite the rising prices, demand remains strong, driven by a combination of local buyers and investors looking to capitalize on the region’s long-term growth potential.

Change in investor activity

The report highlights a notable shift in investor behaviour, particularly in the GTA. Disenchanted with the performance of condominiums, many investors are now turning their attention to detached homes, especially on smaller lots in Toronto’s east end.

A recent report by Urbanation and CIBC Economics found that condominium investors who closed on newly completed units in 2023 faced negative cash flow (of nearly $600 per month), which has prompted many to reconsider their investment strategies.

Affordable housing and the first-time buyer dilemma

While the report highlights significant price appreciation in many markets, it also underscores the challenges facing first-time buyers. Affordability remains a significant barrier, particularly in high-demand regions like the GTA and Greater Vancouver. However, there are still pockets of affordability within these markets.

Regions like Durham in the GTA and the Sunshine Coast in Greater Vancouver offer detached homes priced under $1 million, providing opportunities for those looking to enter the housing market.

The report also calls for policy changes to address the affordability crisis. One suggestion is to extend longer amortization periods (up to 30 years) to resale homes, similar to what is currently available for new construction. While it may not be enough, it could help more buyers qualify for mortgages in high-priced markets and provide some relief to the ongoing affordability challenges.

“All boats rise with the tide — once the first-time buyers segment gains greater traction, we should see a ripple effect,” says Alexander. “We’re not there quite yet, but the tide is beginning to turn … The gap is closing amid growing buyer confidence. The only dark cloud on the horizon is the possibility of a U.S. recession given stock market volatility.”

Alexander stresses that being so closely tied to the U.S. economy, Canada is not insulated, and we can expect buyers to “stay tuned to any possible economic headwinds.”

Review the full report, including market overviews, here.

A Vancouver-based startup is changing the way realtors and buyers assess condominiums and townhomes, making the process more efficient and transparent.

Eli Report is an online tool powered by artificial intelligence (AI) that scans and summarizes condominium and strata documents, culling important information with speed and accuracy.

Aims to make understanding the health of a building and rules around living easy

“We wanted to help realtors save time on critical issues,” says Eli Report CEO Thomas Beattie. “This type of knowledge, when properly equipped, allows them to improve their negotiating position. It’s delivering value for them.”

Beattie describes it as a “breath of fresh air” from the client’s perspective. “It’s a single snapshot report about any lifestyle restrictions, critical issues and other things you wouldn’t be aware of in a new community.”

The Eli Report first started about six years ago, looking to solve a simple problem: to make understanding the health of a building and rules around living easy. It’s applied to condominiums, townhomes or any buildings or developments where a board issues rules to residents and owners collectively share responsibility for common areas.

A ‘huge time saver’ — strata or condo documents can be ‘fairly long and very convoluted’

“Strata documents are fairly long,” says Greg Zayadi, President of rennie, a company that provides real estate consulting to agents, developers and communities. “Some are very convoluted, with years worth of information basically about the health of a building. If you’re a realtor representing a buyer, that’s very important information to understand when you’re advising someone what they should pay, what they should value and if there’s liability.”

An early adopter, Vancouver-based agent Hani Faraj has been impressed not by just the efficiency of Eli Report, but the accuracy as well. 

“It’s a huge time saver,” he says. “When I started using it, I was blown away by how quickly I can pinpoint stuff.” Faraj notes it can cut some reading in half, down from many hours to only a few. “You still have to read, it’s not going to read it for you, but it’s fully transparent. My clients love it. It only adds professionalism to our industry. On our team, every realtor uses it.”

Faraj relayed a story about how a colleague was fined for failing to read a strata document and providing quality support for his client. He also noted he couldn’t think of a moment when the program was wrong. 

Accuracy of the report: ‘We’re very confident we are not going to hallucinate’

Beattie cited only one time in six years that a report raised a question; it wasn’t an inaccuracy, just something that wasn’t yet programmed by the team.

Its accuracy is due in part to the fact that Eli Report does not use generative AI — it’s not trying to create or speculate, but instead, extract.

“It’s designed to pull out anything that’s possibly relevant, even if it’s potentially irrelevant,” says Beattie, who notes his team also reviews the results. “We’re very confident we are not going to hallucinate. Everything you see that’s data-driven is manually approved and reviewed by me or my team. We check everything before it goes out.”

May give pause for sellers

Maria Senajova, also out of Vancouver, is another longtime user, citing Eli Report as a tool for efficiency as well as safety. She doesn’t depend on it completely, but it serves as useful information for clients as well as a third set of eyes on the documents. 

“It offers a quick snapshot,” she says. “It’s really helpful for clients to start getting engaged.”

Senajova only uses it for her buying clients, as due diligence is on the buyer. The transparency that Eli Report offers, however, may give pause for sellers.

“I can see why sellers or listing agents are a little more reluctant,” she says. “I highly recommend it to buying agents.”

Indeed, Faraj was able to leverage information about an upcoming building assessment in a report to take some money off the sale price for his client.

Zayadi wants to see more agents and boards using Eli Report. “We’re talking about consumer protection,” he says, adding there is value in the insurance world as well, as data aggregation and access to key information could help mitigate costs when determining the health of a building.

For Beattie, it has always been and continues to be about providing all the necessary information for clients when looking to buy a condominium or townhome. “It’s the biggest investment most of us make in our lives,” he says. “Whether it’s a starter home or an investment in our future, I certainly believe it should be easier than it has been.”

Engel & Völkers recently released its 2024 Mid-Year Luxury Real Estate Market Report, highlighting that luxury properties in Halifax, Ottawa, Toronto and Vancouver are outperforming market trends in the $1 million-plus market segment.

The report addresses misconceptions about “Canada’s foreign buyer ban,” which the company says has affected the country’s image and disrupted condominium market dynamics, especially in new construction. It also reveals that the market is experiencing a decline in domestic investor activity, with sluggish condominium sales as buyers await relief from higher interest rates.

“Canada’s luxury real estate markets are demonstrating impressive resilience despite the slowdown in overall sales. While interest rates impact the conventional market, particularly first-time buyers, luxury buyers often pay in cash and are therefore less affected,” says Anthony Hitt, president and CEO of Engel & Völkers Americas.

“We anticipate that Canada’s luxury markets will remain stable as real estate continues to be an appealing and safe investment.”

Key national trends

Luxury home sales go against the grain

Sales of detached luxury homes are growing strong in major Canadian cities, defying overall market trends. Rising interest rates have a limited impact on the luxury market, as many buyers pay in cash.

For example, from January to June, Toronto saw a 4.73 per cent increase in prices for homes over $8 million compared to last year. In the first half of this year, Halifax reported a five per cent increase in sales for homes over $1 million. In the same period, Ottawa’s home prices grew by eight per cent for properties between $1 million and $1.99 million, and Vancouver saw a 4.7 per cent increase in the average sale price for homes between $2 million and $3.99 million despite more listings and fewer sales.

Decline in domestic investors

Homes are now mainly being bought and sold for standard reasons like relocating, upsizing and downsizing.

Most domestic investors have left the market due to decreased incentives and higher interest rates. The report notes that in fall 2023, the Bank of Canada indicated 30 per cent of residential home purchases in early 2023 were made by investors, down from under 20 per cent in 2014.

Sluggish condominium sales

Condominiums, which are normally entry-level homes for first-time buyers, are experiencing slow sales as buyers wait for interest rate relief. This lack of competition means buyers who would usually purchase condominiums are now competing for houses. Engel & Völkers predicts that intense competition for residential properties will eventually push buyers back to condominiums.

Millennials, now focused on building families and careers, find one-plus bedroom units insufficient. Likewise, Baby Boomers, who would normally downsize to condominiums, prefer to stay where they are due to the high prices and inadequate size of current condominium inventory.

Review the full report, including regional highlights and property spotlights, here.

As Vancouver’s housing prices continue their upward trajectory, the real estate landscape is undergoing significant shifts. For younger generations, particularly Generation Z and, soon, Generation Alpha, entering the housing market has become an increasingly challenging life milestone. However, a strategic trend is emerging among Generation X and Millennial parents: purchasing homes with their children’s future in mind.

According to new data from Statistics Canada, one in five homeowners in British Columbia who were born in the 1990s co-own with their parents, underscoring the urgency to invest in real estate now.

Source: Statistics Canada

This approach allows parents to not only secure a foothold in an increasingly competitive market but to also ensure their children won’t be left behind in the race for homeownership.

The ‘bank of mom and dad’

More and more, the ”bank of mom and dad” is becoming a go-to for young homebuyers needing financial help. Parents and grandparents aren’t just gifting money; they’re becoming landlords or co-investors to help their children get into the market.

In 2013, my spouse and I saw an opportunity to invest in real estate to secure a foothold in the market. We bought a pre-sale property with future generations in mind, hoping that by the time our kids were ready, they’d have a valuable asset to move into or sell. Success in Vancouver’s real estate market requires strategy and foresight.

When we made the initial investment, our children were eight and four. We realized that a proactive approach would make it easier to help them in the future. The property cost us a little over $300,000 back then, and regardless of current market trends, that put it on track to increase significantly, providing options for our children by the time they are ready to move in or resell. 

Investment properties for future generations

Throughout my almost 25-year career in real estate, purchasing investment properties as a family strategy has also become increasingly common. These investments serve dual purposes: they may not provide significant rental income in the short term, but they will largely cover mortgage and strata fee costs and act as future residences for the next generation. By securing properties now, parents ensure that their children can live nearby and benefit from generational wealth transfer.

Pre-sale properties offer an enticing investment opportunity, allowing parents to secure home ownership early and benefit from a longer period to pay off the mortgage. This strategy not only safeguards against rising market prices but also capitalizes on the property’s appreciation over time, amplifying the financial advantage. 

The Vancouver market: Rising prices and rental pressures

Over the past decade, the Vancouver housing market has experienced consistent price increases and upward pressure on rent.

According to a recent liv.rent report, today’s young people are spending over 50 per cent of their monthly income on rent, creating significant challenges in saving enough for a down payment. As a result, many are choosing to live at home longer with parents or relatives, or opting for smaller rental spaces with roommates.

Developers and multigenerational buyers

Developers are now focusing on the needs of multigenerational buyers, emphasizing properties that promise value appreciation. They prioritize prime locations with access to schools, transit, hospitals and services.

Projects like FRAME by Peterson Group showcase this trend, providing diverse unit sizes and prices to accommodate various family needs centrally located between downtown Vancouver and Metrotown. FRAME is among several developments catering to these changing preferences, ensuring families find the perfect match for their unique situations.

The broader impact of generational housing solutions

The evolving landscape of Vancouver’s real estate market, characterized by rising prices and the growing necessity for parental support, underscores a pivotal shift in how families approach homeownership.

The “bank of mom and dad” has transitioned from a supplementary aid to a foundational strategy, enabling younger generations to secure their place in the market (we had help from my parents when we took the leap in securing our first condominium investment in 2013).

Through strategic investments in properties, notably pre-sale units, families are not only navigating the intricacies of the housing market but are also laying down the groundwork for generational wealth transfer. This trend, while highlighting the challenges faced by younger buyers, also reflects a proactive and unified family approach toward ensuring long-term financial security and stability.

However, it’s important to acknowledge that this collaborative generational support is not a possibility for everyone. As the real estate market continues to evolve in Vancouver and other major Canadian cities, many potential buyers without access to help from family face increasing barriers to homeownership.

This discrepancy underscores the growing concern that homeownership may become even less attainable, contributing to a widening gap where only those with substantial family support or significant incomes can secure a place in the housing market and further reinforces the need for innovative housing solutions that serve all segments of a healthy, diverse society.

It’s sometimes hard to decide what Vancouver is better known for: its ever-prevalent and in-demand real estate market, or its well-earned reputation as Hollywood North.

For Canadians looking to break into the film and television industry, Metro Vancouver would seem the logical place to be if you want to pursue a career in acting but aren’t interested in heading south of the border. The region and its competitive markets also offer plenty of opportunities for motivated realtors.

Actors turned realtors

Tyler Burrows, now a realtor with Oakwyn Realty, didn’t originally move to Vancouver from Kamloops to pursue a life in real estate. With Christopher Reeves and Jim Carrey as some of his earliest inspirations, he realized early on in life that he wanted to become an actor. 

“In high school, I got into theatre and acting class there and really developed a love for it,” he shares. “So I decided that was what I was going to pursue.”

Lucas McCann, another realtor with Oakwyn Realty, also moved to Vancouver with acting aspirations. 

“I had no clue what I wanted to do and spent six months in college. I realized it was just not for me”, says McCann.

A friend of his invited him to a workshop in Victoria, where he’s originally from, where his interest in acting first developed. Two years later, after completing an acting program, he made the leap and moved to Vancouver. 

So how did Burrows and McCann find themselves where they are today, as realtors in arguably the hottest real estate market in Canada?

A deep curiosity about the real estate process; a desire to ‘control my own fate’

For Burrows, it was a case of life imitating art. He and his partner, a dancer, purchased their first home together in Vancouver in 2018. As two self-employed creative professionals, the process was a little bit more complicated for them. The learning curve he experienced during this time inspired him to dig deeper into the real estate industry.

“I didn’t know these nuances back then … I was thinking, like, what else do I not know about this industry?” Burrows confesses. “I never got off the real estate track after that.”

In McCann’s case, he found himself motivated to try a different career path after years of grinding it out at auditions and long days on set:

“I wanted to be able to control my own fate. I need to be in a profession that I could put however much hard work I put into it, I’m actually getting out of it,” he adds. “As an actor, I felt like it didn’t matter how good you were. You may be the best in the room. But it didn’t come down to that.”

A passion reignited

On the flip side, Sean Gartland, a realtor with Angell Hasman & Associates, finds himself now pursuing his passion as an actor. Growing up in Vancouver, he was part of the theatre program and acted in several productions in high school. Yet he decided to pursue a more conventional career path in business, and eventually real estate.

“Society can sometimes squash those dreams,” reflects Gartland.

Coincidentally, it was through meeting Burrows one day at an open house that reignited Gartland’s interest in acting. While he still maintains a healthy and robust real estate practice, he is now also exploring the acting profession by working with a coach and taking classes.

“I do enjoy real estate professionally, but it doesn’t do anything for me creatively,” he says.

More in common than meets the eye

One thing that Burrows, McCann and Gartland have in common is their belief that being an actor and being a realtor have more in common than meets the eye.

It just takes one look at Burrows’ social media channels, particularly his video tours, “Touring With Tyler” which are growing in popularity, to see how years of working in film and television have translated well into his current realtor marketing game.

“For my social media, I’ll go out in one day and shoot 10 different places, or two or three days and shoot a bunch of different places,” explains Burrows. “Then I’ll edit them all in one night and do all the voiceovers in one night. I took my film career and blended it into my real estate career.”

If he was approached by any actor interested in becoming a realtor, the first question McCann would ask them would be, “Have you ever worked in the restaurant industry?”

“If you ever served somebody as a bartender, or just talked to people in a common conversation, that’ll help … It’s about building a relationship with your clients,” he shares.

Gartland echoes this sentiment, albeit from an inverse perspective: 

“If you don’t put in the work to truly connect with people during a scene, it’s going to fall flat. And if you don’t connect with people in real estate, they’re not going to trust you.”

Whether you’re getting ready to watch the next blockbuster or you’re carefully watching the real estate market activity in Vancouver, be sure to get the popcorn out this summer.

Engel & Völkers recently announced Monique Badun and her team have joined its Vancouver shop from Sotheby’s International Realty.

Badun and her team, including Kim Craig and Vito Longo, will work from the Kerrisdale location, representing clients across Westside and downtown Vancouver neighbourhoods.

Known as a top Vancouver real estate professional, Badun brings 35 years of real estate experience. The company says she’s partnered with them because of an aligned ethos, powerful global network and team camaraderie.

“Monique is the epitome of what a real estate professional should be and I have looked up to her and admired her as an industry leader for many years. It’s an honour to have her join us at Engel & Völkers, enriching our team with expertise, professionalism and a true passion for real estate.

Her unrivalled knowledge of Vancouver’s real estate market and high-quality customer service perfectly aligns with Engel & Völkers’ mission,” says Andrew Carros, chief operating officer, Engel & Völkers Vancouver.

An ‘easy decision’

Badun says she’s delighted to join the Engel & Völkers Vancouver shop, and, “Its collaborative group of advisors and the brand’s prestigious reputation and influential global network made this an easy decision … Our shared commitment to providing exceptional service to clients made Engel & Völkers the ideal choice.”

Photo source: Instagram.com/moniqueandkim/

For Brenda Knights, CEO of BC Indigenous Housing Society, the recent announcement from the City of Vancouver about a land transfer agreement at 990 Beatty Street was a long time coming.

“It was really hard to keep to ourselves because we’ve known about it for a while,” she now enthusiastically shares with us.

The agreement will facilitate the creation of over 670 affordable rental homes across three sites.

Project is about housing ‘in proximity to culture and community services access’

Knights is a member of Kwantlen First Nation. The ancestors of its members were guided by their seven traditional laws: health, happiness, generations, generosity, humbleness, forgiveness and understanding.

In a similar fashion, Knights believes in four areas which Indigenous people need support for healthy communities. “There needs to be good governance, access to community services, access to culture and some form of an economy,” she says.

To Knights, the delivery of affordable rental homes through this new project goes beyond just housing, as it touches on some of these areas: “The housing announcement is much more than just providing housing for Indigenous people,” she explains. “It’s having housing in proximity to access to culture, having housing in proximity to access to community services.”

Keeping families together: A key priority

Kelly Lin, partner at Terra Social Purpose Real Estate, has also been involved in this project through work with Brightside Community Homes Foundation. While she has worked in the real estate development sector for almost two decades, she’s the first to acknowledge that she still has a lot to learn. Lin firmly believes that all Indigenous projects should have a subject matter expert involved. 

“As a non-Indigenous person, I don’t know what’s best for the community,” she explains.

The 990 Beatty Street project will also bring a new child-care facility and firehall to the community. Keeping families together was a key priority for Knights in helping develop the residential unit mix.

“The first thing we want to try is to get in as many larger units because we look at our waitlist and we’re needing more family units. Unfortunately, the economics of the site, sometimes with land costs, don’t always work out that way,” Knights explains.

Creating spaces to share culture, gather, set up for success

Knights says the next way to keep families together is to work with them on applications. “So, we could have an elderly couple staying in a one-bedroom and then have a family in a two- or three-bedroom. They’re in the same building, at least, so that they can support one another.”

Childcare programs such as Head Start also serve as safe spaces; community hubs for Elders to pass on culture and stories to the next generation. The benefits can carry over well beyond the sandbox, in Knights’ opinion. This is reinforced by the Public Health Agency of Canada’s 2022 research that shows highly positive feedback and evaluation findings from participants in the Aboriginal Head Start in Urban and Northern Communities Program.

“We’ve seen success in my own community, where we have more people going into post-secondary than we’ve ever seen, so we want to bring some of those things to the urban environment for our tenants, and help them be set up for success. I think it starts with their youth having a safe place where they can come and gather, where Elders can come and they can share their culture.”

The Indigenous perspective in their own communities ‘hasn’t always taken first precedence’

These differences in culture are apparent even at the earliest stages of the development process itself, according to Lin’s years of experience as a development manager. When working on projects that involve Indigenous communities, she’s found that their perspective hasn’t always taken first precedence.

“How we typically work with development is thinking through a non-Indigenous lens,” says Lin, “But Indigenous people have very different processes; there are multiple levels of detail. We need to build the capacity for Indigenous people, build their confidence and capacity in the development industry.”

How the industry can do better and truly help

Education is the first path she recommends for anyone in the real estate development sector looking to work more closely with Indigenous communities.

“I get more and more people chatting with me about the question, “How can I really help?” … The very first thing one can do is try to educate yourself and open your mind,” Lin advises.

Indigenous-led developments seem poised to continue making a major impact in shaping the future of Metro Vancouver. But Knights knows there’s still a long way to go.

“My Nation name, Kwantlen, translates to “Tireless Runner,” says Knights. “I’ve been taught intergenerationally that when there’s a job to do, the job’s never done. So we’re just going to continue to try and get as much housing until we no longer have waitlists.”

Photo credit: Vancouver.ca

In 1979, during the North American Soccer League (NASL) finals between the Vancouver Whitecaps and New York Cosmos, sportscaster Jim McKay passively referenced Vancouver as a “village.” In terms of the size, scale and population of New York at the time, he wasn’t far off. 

Expo 86: A turning point

Skip ahead to 1986, a year that significantly boosted the global profile of both Vancouver and the province of British Columbia. The launch of Expo 86 came with significant global fanfare.

Unlike Expo 67, this event had a singular theme related to transportation and communications. The official statement was “World in Motion — World in Touch,” which spoke to the regional desire at the time to be bigger, better known and more growth-oriented. Mid-eighties Vancouver was a far smaller port city situated on the geographical edge of a much younger Canada. It was rougher around the edges and economically defined by blue-collar industry, especially related to forestry. 

2010 Winter Olympics spend: To get Vancouver to a A-list status

The next major event to boost Vancouver’s profile on a global level was the 2010 Winter Olympics. The Vancouver Olympic Games opened with a governmental statement by then-premier Gordon Campbell in which he stated, “Hosting these Games is an achievement on the world stage that all British Columbians and all Canadians can be proud of. Together, we have welcomed the world with open arms to see and experience our nation, our province and our communities.”

As any British Columbian of a certain age can attest from the intensive lead-up media dialogue, the main justification of the public spend was to transition Vancouver to an A-list city, putting it increasingly on the international map, with the hope of attracting global investment and building out increased tourism. In the end, the Vancouver Olympic Games achieved those goals and set a path of ongoing development and investment underway.

But this also came with significant social and economic consequences.

Vancouver’s social and economic transition

Vancouver now ranks high among world-class cities, repeatedly named as one of the most liveable cities in the world by The Economist magazine. But let’s reflect on the social and economic transition of recent years.

It has happened with such intensity that many residents barely recognize the city compared to just a decade or two prior. The city is now a go-to location for the rich, the famous, winter sports devotees and dedicated outdoor enthusiasts. It’s increasingly become a mosaic of cultures, apparent in everything from the cuisine to entertainment options across the city. In addition to being an industrially driven economy, the tech sector has built up, and a wide landscape of mid-sized businesses have settled in alongside international corporations such as Amazon, Microsoft and Lululemon. 

Rather than celebrate the change, the average Vancouverite spends far more energy bemoaning the past

In conjunction with these big-city trends, an unfortunate byproduct is the notable jump in the cost of living. Home prices have more than quadrupled since the year 2000 and Vancouver rents have skyrocketed as vacancy rates cratered. And it’s interesting that while the city has dramatically changed, its residents have not.

Far from celebrating this transition, the average Vancouverite spends far more energy bemoaning the past. Yet not only has Vancouver transitioned to a city well-positioned in the global gaze, but we’ve done so by our own hand.

The speed of change in Vancouver and the rapid erosion of affordability have left many grasping for a version of the city that no longer exists and will never return. “Why can’t I buy a house for $200,000 as my parents did back in ‘83?” was a complaint relayed to me at a recent social function. The reason is that it’s not ’83, and today’s Vancouver has little in common with its early ’80s incarnation.

Homeownership expectations in other world cities are more tempered; band-aid solutions don’t work

Accepting the new Vancouver by big city standards means a major transition in terms of expectations. Do residents in New York, Tokyo, London and Paris express consistent outrage at the inflated cost of regional housing? Arguably, yes, but the expectation of home ownership in these regions is also decidedly more tempered.  

Not only have Vancouver residents failed to keep pace with this transition, but federal and provincial governments, in reaction to public affordability concerns, focus a great deal on piecemeal legislative measures designed to contain or, at worst, pursue the patently impossible goal of “restoring affordability.”

Not only will these band-aid measures never be able to address the fundamental influences that have driven prices up in the first place, but they divert government focus from where it would be better served, which is aiding local economic development. On the whole, the Canadian economy is not particularly prospering, and much more needs to be done to strengthen our export markets and focus on overall Canadian business efficiency.

Here’s what’s missing

The missing piece of the A-list city reality for most Vancouverites isn’t the cost of housing, rent and living expenses. It’s that rather than living under the false dichotomy that housing prices will magically decline despite record demand and prolonged supply drought, a more sustainable and practical path forward would be to build out an increasingly robust regional economy.

BC business prosperity all too often seems like an afterthought when it comes to provincial governmental priorities. British Columbia would be best served moving forward with a significant focus on our regional and global business competitiveness.

There’s little sustainability living in a city that draws global attention but with a regional economy that’s still parked in village status.

Please note that it is BCREA policy to not respond to comments on any of its online articles.

Earlier this month, a group of realtors from Greater Vancouver hosted a gala that raised $52,000 to support Camp Choice BC and its August camp funding.

Over 260 realtors were in attendance at Vancouver’s Italian Cultural Centre, including the CEO of Greater Vancouver Realtors (GVR), Jeff King, and the CEO of the British Columbia Real Estate Association (BCREA), Trevor Koot.

Gala highlights

The annual Camp Choice Gala is a cornerstone event for the organization’s fundraising. It includes sharing stories, hearing testimonials and seeing performances from teens who attended the camp and participating in a silent auction with a live auctioneer.

It was this auction that was the “standout” moment of the night, according to Phil Moore, vice chair, event organizer, facilitator and mentor at Camp Choice BC: “Myself, John Patricelli and Juliana Vallee offered four hours of (chores or) cleaning services, raising over $20,000.

These efforts are vital, as they ensure we can offer this life-changing experience to 50 to 60 youth without turning anyone away due to financial barriers.”

Phil Moore, Trevor Koot (BCREA) and Jeff King (GVR)

Vallee, who has been a part of the organization for the past two and half years and now sits on the board of directors, notes the bids started at $200 and jumped by the hundreds and then into the thousands. “Finally, a business owner jumped up and bid $20,000 which translates to sending approximately 20 youth to the camp,” she highlights. 

The leadership camp experience

Each year, the group fundraises (about $50,000-$70,000) for and hosts a one-week camp at Zajac Ranch in Mission, B.C., welcoming 50-60 youth facing challenges such as substance abuse, self-harm and underprivilege.

Every dollar is spent to maximize the positive impact on the youth served, ensuring they receive the full benefit of their experience at Camp Choice BC.

As facilitators and mentors, Moore, Patricelli and Vallee lead various sessions, providing guidance and support to both attendees and volunteer youth coaches. The program is designed to empower, inspire and transform, helping participants see beyond their current circumstances.

Each day is wrapped up with workshops and fun activities that bring out self-growth, powerful messages and opportunities to connect with others.

“These individuals have unique life situations and stories. Most of their experiences up to now have built in them emotional and rational processes that have not been serving them to choose well or receive all possible opportunities in life. There are levels of challenges they have had to face,” Patricelli, Camp Choice’s president and lead workshop facilitator, explains. “It’s about exploring their thinking process (and) opening up if they feel comfortable.”

At the end of the week, the team observes how participants have connected with each other. “In a short period of time, we notice a lightness to their smiles, a confidence we didn’t see before and a desire to return as well as continue growth. They have fun, meet new friends and build bonds that last,” says Patricelli.

Vallee agrees: “(It) allows kids to be kids and brings out and pushes them to be the best they can be. Youth come out of the camp inspired and empowered. Many who have attended stated that because of this camp, their lives have changed.”

She explains that not only are relationships built during the camp between the youth and coaches, but the relationship, mentorship and follow-up with the youth continue after it’s over.

The trio’s inspiration

Moore’s background with the Vancouver Police Department, particularly admiring the school liaison program, laid the foundation for his commitment to supporting youth at risk. “Discovering a program through PSI Seminars that brought leadership opportunities to young people from Oakland to a ranch in Napa Valley sparked the idea for Camp Choice BC.”

Patricelli describes himself as “someone whose youth (went from being) filled with wrong choices and living consequences of those choices to experiencing the power of redemption from personal mistakes … learning that at any moment one can make a choice that will also lead to success and better relationships with others.” He says this — and the higher calling he felt — is why he decided to get involved with Camp Choice.

So, alongside Patricelli and with Vallee on the board of directors, “(We) aimed to create a similar beacon of hope and leadership for youth in British Columbia,” Moore recalls.

About Camp Choice

Camp Choice was first founded in San Francisco a few years before it came to B.C. in 2016. “Over the last eight (years), the Camp Choice vision has maintained strong and the board of directors has evolved,” Patricelli says.

Camp Choice started as a non-profit organization and hosted its first leadership youth camp in 2017. After more growth and awareness, elevated fundraising (and the ability to provide tax receipts) became more essential to attract larger donations — which primarily come from realtors — it was registered as a charity in 2019.

About this year’s event and overall, Moore says, “We’re deeply grateful for the support from the realtor community, which has been instrumental in our ability to make a difference in these young lives. It should be noted that many of our volunteer camp counselors are realtors. We look forward to continuing this work, inspired by the transformations we witness each year.”

Learn more about Camp Choice BC here.

Despite high carrying costs, condo investors in Vancouver and Toronto are hanging onto their properties. But, it’s often because there are few takers if they try to sell, realtors in both cities say.

Listings for investment condos in Vancouver have increased and sales have declined rapidly over the last three or four months, says Jesse Kleine, a realtor with Sutton Group-West Coast Realty in Surrey, BC.

Condo investors losing equity “don’t want the headache anymore”

With many Vancouver condo investors sitting on $100,000 to $300,000 in equity, the feeling is, “Let’s just get rid of it even if it’s worth less than it was six months ago,” Kleine says. “I just don’t want this headache anymore” of high interest rates and the potential of running out of cash to float the condo.

However, once they discover there are several virtually identical condos not selling, many investors just decide to hang on and borrow money from family.

Tim Syrianos, broker/owner at Re/Max Ultimate in Toronto, notes potential sellers are saying, “I’m not going to sell my property because people can’t buy it. I’ll just put it back onto the rental market.”

Biggest obstacle to condo buyers: Mortgage stress test

Although an October Re/Max study found 33 per cent of Canadians who want to buy or sell a home in the next 12 months will wait and see how interest rates play out, Syrianos says other factors are putting a halt on transactions.

Namely, the government’s mortgage stress test. He says it’s “the biggest obstacle to not just investors, but any person who wants to buy a condo.”

The stress test requires borrowers to qualify at a rate of 5.25 per cent or the lenders’ offer plus 2 per cent, whichever is higher.

“The majority of our realtors are talking about the stress test, and not interest rates, as being the biggest barrier to having first-time buyers or people who are renting who want to enter the market,” says Syrianos, whose brokerage services condo-heavy downtown Toronto.

Many first-time buyers can’t enter the real estate market because of the 2 per cent stress test threshold, says Syrianos, who suggests it should be lowered to 1 per cent.

Syrianos, a former president of the Toronto Regional Real Estate Board, says condo inventory is steadily increasing but if changes were made to the stress test “we would definitely see absorption of these condos.”

Investors holding out but for how much longer?

Earlier this year, Statistics Canada released data from 2020 that found 36.2 per cent of condominium apartments in BC and 41.9 per cent in Ontario are used as investments by owners.

Some Vancouver investors have told Kleine they have enough money to float their negative cash flow condos for a few more months but will then have to find more money as they wait for high interest rates to come down.

“It’s not really a rush for the door yet; people are still getting money from family and still holding on and sacrificing in hopes of the market coming back next year,” Kleine shares.

An investment condo is “supposed to be there to improve your life and if it’s not doing that, people just want to get rid of it.”

Downtown Vancouver flooded with discounted stock

Kleine says there’s “a whole whack” of generic, 15-year-old, one-bedroom condos in downtown Vancouver sitting on the market without any action. After being priced at $700,000 to $710,000 in July, they’re now asking for about $665,000. However, it’s uncertain as to whether there is a big buyer pool waiting to snatch discounted prices.

Still, vendors will make profits of $100,000 to $200,000 if they bought five or 10 years ago, he says.

Costs not covered by long-term tenants paying below-market rents

According to the Real Estate Board of Greater Vancouver, there were 5,446 detached, attached and apartment properties listed for sale in Metro Vancouver in September. This was 28.4 per cent more than in the same period a year earlier.

“The catch-22 is many condo investors have tenants locked in who are paying below-market rents”, Kleine says. They’re paying about $2,200 per month when the market’s closer to $3,200 and much more aligned with owners’ expenses today – mortgage costs, property taxes, insurance and maintenance are in the $3,000 range.

“Any investor buying property always wants it either owner-occupied or vacant so they can rent it at the new market rent,” he says. “The only person that would buy this property now is an owner-occupier who can actually give notice to have the tenant removed. So, it narrows the pool of buyers quite a bit.”

Slower condo markets in the country’s largest centres

Condo sales from January to August 31 declined by 17.1 per cent in the Greater Vancouver Area, with 10,075 transactions compared to 12,159 transactions in 2022, according to Re/Max.

In the GTA, condo sales in the same period declined by 10.8 per cent, with 18,263 transactions, compared with 20,948 in 2022.

“Since interest rates have gone from their lowest ever to generational highs, it’s no surprise the condo markets in Toronto and Vancouver have slowed,” says Shaun Cathcart, senior economist at the Canadian Real Estate Association.

Key differences in inventories, sales, prices and new supply

However, there are differences between the two cities: inventories are not as high in Vancouver, condos are still selling quite a bit faster, and prices did not dip as much and have recovered better in Vancouver, he says.

Another big difference is in new supply. “Toronto and Vancouver condo completions were about the same about 20 months ago, according to CMHC data,” Cathcart says. But, Vancouver completions are at an eight-year low while Toronto completions “took off and are setting records”.

Mortgage arrears: Best distress measure

Cathcart says that mortgage arrears, which he describes as perhaps the best measure of distress in the housing market, are at 0.15 per cent – barely more than the all-time low of 0.14 per cent about 18 months ago.

Condo investors are mostly pushing higher carrying costs onto tenants “which is why rents are going absolutely bananas,” Cathcart points out. “There’s little evidence at this point that (condos) are flooding the market.”