Tag Archives: Neighbourhoods

Real estate flatline

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The relentless climb of Nanaimo property values paused for a breather last year. Assessment notices went out to all Nanaimo property owners last week and many are finding the value little changed from 2011.

Average values for single-family homes, based on property assessments done by the agency on July 1 are down 1.27% from 2010.

Values rose slightly in several areas, but most neighbourhoods saw values down.

The most noticeable drops are clustered in north-end neighbourhoods, though central and south Nanaimo did not go unscathed.

One central-Nanaimo area saw average values down more than 10%.

A decade-long period of almost continuous growth was sidelined in 2011 by events outside local market forces. Housing sales slipped, especially at the higher end of the scale, where there are fewer buyers. Property values that doubled during the 2000s stopped rising. For the smart buyer, it creates a rare opportunity to get an ocean-view or waterfront property.

It isn’t the first time Nanaimo’s housing industry has skipped a beat and it is the nature of real estate markets to run in cycles.

“You look at the pressures in the market – unemployment, challenges with new builders, with HST, overall higher-end market challenges, it’s got to come out,” said Jim Stewart, Vancouver Island Real Estate Board past-president.

Realtors saw 2011 end with an average home selling price of $362,680, just $305 less than a year earlier, or essentially unchanged.

“Late last spring there was waiting with anticipation for the outcome of the HST vote, and (then) everyone was waiting to know who the next premier was to set the agenda for the year. Then in the fall everyone was concerned about the world market. Is Greece going to fail? You look at little Vancouver Island, there are places elsewhere in Canada prices are down doubledigit,” Stewart said.

The 2012 assessment roll puts a total value on all Nanaimo property at $12.742 billion, the bulk of which, $10.769 billion, is residential.

Those numbers are down slightly from 2011′s $12,683 billion total and $10.786 billion in residential. Those totals include about $1 billion in churches, downtown revitalization, pollution-control and other taxexempt property classes.

The B.C. Assessment Authority divides the city into 17 neighbourhoods, and the numbers it produces for each neighbourhood are what matter to homeowners.

Excluding apartments, vacant lots and condominiums, Jingle Pot/College Heights and Hawthorne saw average property values rise the most, at 1.14%. Average home values rose by less than 1% in Chase River/Cinnabar, Uplands/Sunshine Ridge/ Country Club, Hammond Bay and the extended downtown core areas.

The most noticeable drop was in the Commercial Industrial Bowen/Northfield area, where assessments fell 10.28%.

All other areas saw average values drop, with decreases of greater than 4% assessed in Townsite/Hospital, Dover/Dickenson, Long Lake North Island Highway and Protection Island areas.

For most homeowners, this year will be easier than most to figure out their property taxes simply by looking at their property’s assessed value.

Because the average value is so close to 2011, anyone whose assessment is close to last year’s can expect to pay close to the tax rate set by city council this spring.

“Assessments are unchanged, so it should be relatively easy to tell,” said Bill MacGougan, Nanaimo assessor.

While the HST and a sluggish economy are both hurting sales in higher-end properties classes, some see it as an opportunity to buy that dream property.

“When you think the average waterfront home is $800,000, if you get something for less than $800,000 it’s probably a pretty good buy,” Stewart said. Those deals exist because “there’s not that many buyers in that range.”

First-time buyers would be wise to make 2012 a year to renovate, rather than sell.

“If you bought in the last year or so it’s going to be challenging for you to exit on the profit side,” Stewart said.

http://www.canada.com/Real+estate+flatline/5983621/story.html

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Canadian real estate becoming more affordable, RBC says

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The affordability measure captures the proportion of pre-tax household income that would be needed to service the costs of owning a certain type of home. In the third quarter, that index fell for all categories of housing.

“Housing affordability levels are quite good in most parts of Canada and will pose little threat to overall housing demand,” said Craig Wright, senior vice president and chief economist. “The Vancouver area market continues to be a major exception, with sky-high property values in upscale neighbourhoods making it both extremely unaffordable and the most at risk of a downward correction.”

The uncertainty affecting the global economy, with Europe mired in a debt crisis, is helping to keep interest rates close to historic lows. Rates are unlikely to rise until the middle of next year and even then only gradually, RBC said.

The cost of owning a detached bungalow dropped in most major cities in the third quarter, with the exception of Toronto and Calgary, which ticked higher.

Although overall affordability improved slightly in the three months to September, housing costs in Toronto, Montreal and Ottawa are also in an “uncomfortable” range.

“We expect to see further slowing in the pace of home price increases next year, as housing demand levels out,” said Wright. “These factors will set the stage for a period of relative stability in affordability trends in Canada.”

According to the index, the higher the reading the less affordable it becomes to own a home.

For example, an affordability reading of 50% means that homeownership costs, including mortgage payments, utilities and property taxes, take up 50% of a typical household’s monthly pre-tax income.

The index in Vancouver stands at 90.6%, Toronto 52.1% and Montreal 40.9%.

http://money.canoe.ca/money/business/canada/archives/2011/11/20111125-123132.html

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Homeowners see lower costs with lower rates: RBC

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Canadian homeowners caught a modest break during the third quarter as mortgage costs receded slightly, reversing a two-quarter trend in which affordability decreased.

A new report from RBC Economics says the driving factor was low interest rates, which helped reduce fixed mortgage rates across the country.

As a result, the bank says it was more affordable for Canadians to own a standard condominium, two-storey home or detached bungalow in the third quarter, though not by much.

The following RBC statistics include the total mortgage, utility and property taxes incurred by Canadian homeowners:

Owning a condo cost 29 per cent of median pre-tax household income at the national level, a drop of 0.2 percentage points from the previous quarter.

A two-storey home also became cheaper to own, but still costing 48.8 per cent of household income. That was down by 0.6 percentage points.

Finally, a detached bungalow ate up 42.7 per cent of that same income, a decrease of 0.7 percentage points from the second quarter.

In terms of a regional picture, RBC says Vancouver remains the most expensive housing market in the country.

In a statement, RBC Chief Economist Craig Wright said the Vancouver-area has “sky-high property values in upscale neighbourhoods making it both extremely unaffordable and the most at risk of a downward correction.”

On the other hand, RBC says Alberta is among the most affordable provinces in which to buy a two-storey home, detached bungalow or condo.

RBC also says that the Manitoba market “showed some of the more significant improvement in affordability among the provinces in the third quarter.”

Daryl Harris, a Winnipeg-based mortgage professional with Verico One Link Mortgage and Financial, said he was surprised by the RBC report’s analysis of the Manitoba market.

“Affordability generally follows one of two things, either lower rates or a decrease in house prices and I have seen neither in our market,” Harris told CTVNews.ca in a telephone interview on Friday.

Looking ahead to 2012, RBC believes housing prices are unlikely to soar any time soon.

“We expect to see further slowing in the pace of home price increases next year, as housing demand levels out,” said Wright.

“These factors will set the stage for a period of relative stability in affordability trends in Canada.”

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Higher assessment doesn’t mean tax hike

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When the city sends you a letter notifying you that your house has increased in value, the tendency is to freak out. But there’s no need to do that just yet.

Every one of Winnipeg’s approximately 208,000 residential properties and 25,000 commercial properties will be reassessed this year — and almost all of them are worth more now than they were two years ago.

“Everyone knows what’s going on in the housing market. Most homes are appreciating,” Mayor Sam Katz said Wednesday.

Between April 1, 2008 and April 1, 2010, the average Winnipeg residential property increased in value by 12 to 15 per cent.

But an increased assessment does not necessarily translate into paying more property taxes in 2012. The reality is next year’s tax bill depends on the value of your home compared to every other Winnipeg property — as well as the political machinations at budget time.

“At this point in time, it’s impossible to say what your taxes will be in 2012,” said Nelson Karpa, Winnipeg’s assessment and taxation director.

However, there is a way to surmise whether you’ll have to pay more property taxes next year. Here’s how the counterintuitive assessment process works:

Why does the city reassess the value of my home?
Every two years, the city checks to see whether the assessed values of residential and commercial properties in Winnipeg conform to their actual market value.

How do they come up with a number?
Generally, by comparing your home to other properties that recently sold in your area of the city, provided they’re roughly the same vintage, condition and size. Across the city, the average residential increase was 12 to 15 per cent.

Why the range?
The average increase varies from neighbourhood to neighbourhood. In River Heights, it was 15 per cent. In North Kildonan, it was 12 per cent. Individual properties within those neighbourhoods vary as well.

So if my assessment goes up, will my property taxes go up?
The value of your home is not the determining factor. What matters is how much it increased over the past two years in comparison to all city properties — both commercial and residential.

How does this work?
If the value of your home increased at roughly the same rate as most other properties in Winnipeg, you may not be asked to pay more taxes in 2012. But if your increase exceeded the combined commercial/residential average, you can expect to pay more taxes.

My taxes went up after the 2008 reassessment. How could that happen if there was a tax freeze in place?
Between 2003 and 2008, the average increase in residential property values was 78 per cent. If your property increased in value by more than that, you started paying more property taxes in 2010.

How was that a freeze?
Because the overall pool of property taxes the city collected did not increase. Some property owners paid less.

What about commercial properties?
The city is reassessing them as well and will calculate the average commercial property increase later this year. They will affect residential property taxes, even though there are only about 25,000 commercial properties.

Why is that?
If you look at property tax revenue as one big pot of money, commercial properties account for about 40 per cent of the cash and residential properties account for the other 60 per cent. Since commercial properties tend to increase in value at a lower rate than residential properties, the city-wide average increase will likely be slightly less than 12 to 15 per cent.

That means the threshold required for you to avoid paying more property taxes in 2012 will be slightly lower as well. But all this assumes city council will not increase property taxes in 2011 or 2012.

Will there be another tax freeze this year?
Possibly, but not certainly. Katz has said he views a tax increase as a last resort. But he may not have much choice, if the city can’t find enough revenue to cover the increasing cost of delivering services.

When will I hear about my new assessment?
The city mailed out the first batch of 2012 reassessment preview letters on Nov. 5 to 70,000 homeowners. Another 62,000 letters went out on Jan. 7. The final 76,000 letters will go out on Feb. 11.

What if I don’t like my assessment?
If you just received a preview letter, you can discuss it with city staff at Waverley Heights Community Club from Jan. 24 to 27. Call or email 311 for an appointment.

If you received your preview letter in November, call or email 311 and ask for an assessor to look at your file. If you have yet to receive a preview letter, wait until February.

Can they change my assessment?
Assessors have the power to make changes if they learn they’ve made a mistake. For example, if your file claims you have a garage and you do not, that, too, would be a mistake. But if you just don’t think your property is worth more and have no argument to back up that opinion, you’re out of luck.

How long do I have to gripe about my assessment?
Until the end of March, when the city begins preparing the final notices to be mailed out in June. “It takes time to print 220,000 pieces of mail or more,” Karpa said. “We can’t adjust the roll at the last minute.”

What if I miss that deadline?
After you get your final notice in June, you can appeal your assessment to the city’s Board of Revision. But it’s easier to deal with the issue now, while adjustments can be made that do not involve a quasi-judicial body.

http://www.winnipegfreepress.com/local/higher-assessment-doesnt-mean-tax-hike-113443394.html

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First-time home buyers willing to carry more debt

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“A lot of people assume that younger Canadians buying their first home in a city would naturally choose the affordable condo option, but this study shows that this isn’t the case,” said Chris Wisniewski, group product manager, Real Estate Secured Lending, TD Canada Trust. “Buying in the city often means choosing an older home that needs work, so many are looking at renovating soon after they purchase.”
WinnipegREALTORS® has noted the revitalization of older neighbourhoods resulting from an influx of young home buyers.
“Young first-time buyers are looking at established neighbourhoods with affordable homes, and are buying these homes with financial assistance from their parents,” said WinnipegREALTORS® market analyst Peter Squire.
“While some are looking for that perfect house, many are willing to put sweat-equity into a fixer-upper in an older established neighborhood,” he added
When today’s 55-plus Canadians bought their first home, paying off their mortgage was a top priority To day, according to the TD Canada Trust survey, slightly less than half of young Canadian adults agree that paying off their mortgage is a first priority, compared to 64 per cent of Canadians over 55, according to the TD Canada Trust survey.
In Winnipeg, Squire said many young first-time buyers are now willing to carry more debt, especially when two working adults are the home buyers.
For Canadians across all generations, their home is their biggest investment. The study found eighty- eight per cent of Canadian adults 18 to 34, 87 per cent of Canadians 35 to 54, and 78 per cent of those 55-plus all agreed that their first home was an investment for the future. Sixty-four per cent of younger Canadian adults aged 18 to 34 said they put all their savings into their first home compared to 62 per cent of Canadians aged 55-plus arid 54 per cent of Canadians aged 35 to 54.
The research revealed that when it comes to getting a mortgage, young adults tend to shop around more than their older counterparts did. Sixty-two per cent of older Canadians were loyal to their own bank and received financing where they were already a customer, compared to 36 per cent of younger homeowners who were more likely to shop around and take recommendations.
“There are so many different options available now, and easier access to information with the use of the internet, that it’s no wonder today’s first-time home buyer shops around a bit more,” added Wisniewski.
“It’s a great idea to look around and see what’s available. Thirty years ago when people were looking for financing, they usually had limited choice. Now there are many options to explore with your bank, including a variety of fixed-rate mortgages, variable-rate mortgages, and even green mortgages for buyers who want to lessen their footprint on the environment.”

“A lot of people assume that younger Canadians buying their first home in a city would naturally choose the affordable condo option, but this study shows that this isn’t the case,” said Chris Wisniewski, group product manager, Real Estate Secured Lending, TD Canada Trust. “Buying in the city often means choosing an older home that needs work, so many are looking at renovating soon after they purchase.”

WinnipegREALTORS® has noted the revitalization of older neighbourhoods resulting from an influx of young home buyers.

“Young first-time buyers are looking at established neighbourhoods with affordable homes, and are buying these homes with financial assistance from their parents,” said WinnipegREALTORS® market analyst Peter Squire.

“While some are looking for that perfect house, many are willing to put sweat-equity into a fixer-upper in an older established neighborhood,” he added

When today’s 55-plus Canadians bought their first home, paying off their mortgage was a top priority To day, according to the TD Canada Trust survey, slightly less than half of young Canadian adults agree that paying off their mortgage is a first priority, compared to 64 per cent of Canadians over 55, according to the TD Canada Trust survey.

In Winnipeg, Squire said many young first-time buyers are now willing to carry more debt, especially when two working adults are the home buyers.

For Canadians across all generations, their home is their biggest investment. The study found eighty- eight per cent of Canadian adults 18 to 34, 87 per cent of Canadians 35 to 54, and 78 per cent of those 55-plus all agreed that their first home was an investment for the future. Sixty-four per cent of younger Canadian adults aged 18 to 34 said they put all their savings into their first home compared to 62 per cent of Canadians aged 55-plus arid 54 per cent of Canadians aged 35 to 54.

The research revealed that when it comes to getting a mortgage, young adults tend to shop around more than their older counterparts did. Sixty-two per cent of older Canadians were loyal to their own bank and received financing where they were already a customer, compared to 36 per cent of younger homeowners who were more likely to shop around and take recommendations.

“There are so many different options available now, and easier access to information with the use of the internet, that it’s no wonder today’s first-time home buyer shops around a bit more,” added Wisniewski.

“It’s a great idea to look around and see what’s available. Thirty years ago when people were looking for financing, they usually had limited choice. Now there are many options to explore with your bank, including a variety of fixed-rate mortgages, variable-rate mortgages, and even green mortgages for buyers who want to lessen their footprint on the environment.”

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