Canada Mortgage and Housing Corporation (CMHC) has released the 2018 Prospective Home Buyer Survey (#PHBS2018). This survey, the first of its kind for CMHC, explores the dynamics of home buying intentions for three groups of future homebuyers, including First-Time Buyers, Previous Owners and Current Owners, and provides a comprehensive review of overall awareness and understanding of the home buying process.

“The Survey findings provide insights and valuable information for mortgage professionals about their future clients and their needs,” said Nathalie Fredette, Vice-President, Client Relationship Management. “It brings awareness amongst the industry and contributes to financial literacy by helping Canadians make informed and responsible home buying decisions.”

Top motivators for buying a home

• Improved accessibility (less physical obstacles and barriers) and investment opportunity were noted as top motivators across all groups.
• Changes to mortgage regulations and concerns about possible future interest rate increases were not among the top motivators for prospective home buyers in 2017.

Housing expectations

• Over four-in-ten First-Time Buyers and Previous Owners say they would delay their home purchase if they were not able to find their ideal home, with a fairly similar proportion saying they would be willing to compromise on the size of the home and location.
• An existing move-in-ready home is the top choice for all groups of prospective home buyers, followed by a newly constructed home, noted by approximately one-fifth of First-Time Buyers and Previous Owners.

Financing and saving for a down payment

• Among all groups, the two most common actions completed one to two years prior to the purchase of a home are saving for a down payment and determining what type of home to buy.
• About one-in-four prospective home buyers stated that they would be very likely to consider delaying their purchase in the event of an increase in interest rates.
• The majority of future home buyers intend to obtain a mortgage to finance their home purchase, with First-Time Buyers showing higher incidence compared to Previous Owners and Current Owners.
• Across all groups of future home buyers, more than six-in-ten say they are likely to have a financial buffer in case their expenses change in the future.

Survey methodology

In October 2017, CMHC surveyed 2,507 prospective home buyers online. Respondents were all prime household decision-makers who intend to purchase a new home within the next two years, including 1,501 First-Time Buyers, 506 current owners, and 500 previous owners. Similar to the annual Mortgage Consumer Survey, the Prospective Home Buyers Survey is intended as an education tool for mortgage professionals and to support mortgage literacy among Canadian home buyers and homeowners.

Additional survey findings are available here.

CMHC helps Canadians meet their housing needs. As Canada’s authority on housing, we contribute to the stability of the housing market and financial system, provide support for Canadians in housing need, and offer objective housing research and advice to Canadian governments, consumers and the housing industry. Prudent risk management, strong corporate governance and transparency are cornerstones of our operations.

Attached and apartment homes are in demand across Metro Vancouver* while detached home buyers are facing less competition today.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,818 in January 2018, a 19.4 per cent increase from the 1,523 sales recorded in January 2017, and a 9.8 per cent decrease compared to December 2017 when 2,016 homes sold.

Last month’s sales were 7.1 per cent above the 10-year January sales average. By property type, detached sales were down 24.8 per cent from the 10-year January average, attached sales increased 14.3 per cent and apartment sales were up 31.6 per cent over the same period.

“Demand remains elevated and listings scarce in the attached and apartment markets across Metro Vancouver,” Jill Oudil, REBGV president said. “Buyers in the detached market are facing less competition and have much more selection to choose. For detached home sellers to be successful, it’s important to set prices that reflect today’s market trends.”

There were 3,796 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in January 2018. This represents an 8.3 per cent decrease compared to the 4,140 homes listed in January 2017 and a 100.7 per cent increase compared to December 2017 when 1,891 homes were listed.

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 6,947, a four per cent decrease compared to January 2017 (7,238) and a 0.2 per cent decrease compared to December 2017 (6,958).

For all property types, the sales-to-active listings ratio for January 2018 is 26.2 per cent. By property type, the ratio is 11.6 per cent for detached homes, 32.8 per cent for townhomes, and 57.2 per cent for condominiums.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

The MLS® Home Price Index composite benchmark price for all residential homes in Metro Vancouver is currently $1,056,500. This represents a 16.6 per cent increase over January 2017 and a 0.6 per cent increase compared to December 2017.

Detached home sales in January 2018 reached 487, a 9.7 per cent increase from the 444 detached sales recorded in January 2017. The benchmark price for detached properties is $1,601,500. This represents an 8.3 per cent increase from January 2017 and a 0.3 per cent decrease compared to December 2017.

Apartment home sales reached 1,012 in January 2018, a 22.7 per cent increase compared to the 825 sales in January 2017. The benchmark price of an apartment property is $665,400. This represents a 27.4 per cent increase from January 2017 and a 1.5 per cent increase compared to December 2017.

Attached home sales in January 2018 totalled 319, a 25.6 per cent increase compared to the 254 sales in January 2017. The benchmark price of an attached unit is $803,700. This represents a 17.5 per cent increase from January 2017 and unchanged compared to December 2017

*Editor’s Note: Areas covered by the Real Estate Board of Greater Vancouver include: Whistler, Sunshine Coast, Squamish, West Vancouver, North Vancouver, Vancouver, Burnaby, New Westminster, Richmond, Port Moody, Port Coquitlam, Coquitlam, Pitt Meadows, Maple Ridge, and South Delta.

The real estate industry is a key economic driver in British Columbia. In 2017, 35,993 homes changed ownership in the Board’s area, generating $2.4 billion in economic spin-off activity and an estimated 17,600 jobs. The total dollar value of residential sales transacted through the MLS® system in Greater Vancouver totalled $37 billion in 2017.

The Real Estate Board of Greater Vancouver is an association representing more than 14,000 REALTORS® and their companies. The Board provides a variety of member services, including the Multiple Listing Service®. For more information on real estate, statistics, and buying or selling a home, contact a local REALTOR® or visit www.rebgv.org.

Port Coquitlam Mayor Greg Moore is heading a coalition of cities urging the provincial and federal governments to work on affordable housing solutions. Arlen Redekop / PNG

VANCOUVER — Local politicians in British Columbia are calling for an overhaul of the housing system with significant tax and regulatory changes in order to bring skyrocketing real estate and rental prices back to a level local residents can afford.

The Union of B.C. Municipalities has issued a report containing 32 recommendations for provincial and federal governments based on research and best practices from across Canada and around the world.

Mayor Greg Moore of Port Coquitlam led the initiative for the union and said there are numerous reasons for the crisis in housing affordability that require a “multitude of solutions.”

“The frustrating part that I see is many individuals and associations come out and say, ‘Well if we just did (housing) supply then everything would be solved.’ Well it’s much more sophisticated than that,” he said.

“It has to look at the continuum of housing. Rental plays an extremely important part in that, but so does the demand management side of it.”

Speculation by foreign and domestic investors has contributed to escalating real estate prices in Metro Vancouver, which has had a spillover effect on other B.C. communities and the rental market, he said.

Using taxes as a tool along with stronger regulations at the municipal level is a “winning combination” to fix a complex issue, Moore said.

To curb real estate speculation, the union wants the province to consider expanding its 15 per cent tax on foreign buyers in Metro Vancouver to include other areas, such as Victoria, where markets have been heating up. It also wants a review to determine if the 15 per cent rate is sufficient.

The strategy also calls for more transparency around who owns property.

University of B.C. geography professor David Ley, who contributed to the report, said the United Kingdom provides a good example where regulatory changes now require identifying the owner, preventing foreign investors from dodging taxes or laundering money.

“We want a declaration of who the actual owner is,” Ley said, noting that property in B.C. can be owned by trusts or companies, hiding the person behind the purchase.

Taxes are also being suggested to cut at the heart of the issue of profit-driven property flipping that has fuelled some B.C. markets, Ley said.

The strategy includes a sellers tax on those who flip their homes within a few years of purchase to make a profit. It also calls for a more progressive tax system that hits luxury properties at a higher rate.

“What we need to recognize here is that we’re in a very abnormal situation in Vancouver, abnormal in the scale of the affordability crisis, and it does require determined response from government,” Ley said, adding a similar strategy could be helpful in Toronto where affordability has reached similar crisis levels.

While housing supply is a problem, Ley said it’s too simplistic to expect that increasing the overall supply will be a solution for the market because many units are being built every year.

“The problem is that those are not affordable units and they’re not targeted to a local market or at least to the local wage structure, they’re targeted to an investment market,” Ley said.

The strategy calls for tax breaks on developers building affordable units, and also giving municipalities power to create a progressive property tax system so that those types of developments are provided longer-term breaks.

Moore said giving municipalities more power to zone areas for rental developments would ensure that new buildings remain as rental stock.

The union has been in talks with the provincial government, and Moore said he hopes to see some of the recommendations included in the upcoming budget.

The B.C. Green party released its housing strategy Wednesday that also focuses on speculation, the supply of affordable housing, financial relief for renters and improved transparency and data collection on ownership.

“British Columbians have awaited action for far too long,” said Leader Andrew Weaver in a statement.

“It is time to move past rhetoric and get to work delivering solutions.”

Housing Minister Selina Robinson said in a statement that the province has already taken steps to address the housing crisis by improving supports for tenants and landlords, increasing housing for the most vulnerable, and cracking down on tax cheats.

She said the government welcomes the strategy put forward by municipalities and the upcoming budget will include a plan that “looks at the big picture.”

Provided by: Canadian Press