Commercial activity in Vancouver surges

It was the second best first quarter ever for Greater Vancouver commercial activity, according to RealNet Canada Inc.

The research company said they were 299 deals worth more than a million in the first quarter for a total of $1.2-billion. The only better first quarter was recorded in 2007.

“Although a decrease in pace was recorded in the first quarter [from the fourth of quarter of 2011], the results are now consistently in line with results witnessed during 2006 and 2007,” said George Carras, president of RealNet. “The Greater Vancouver market has now posted five quarters in excess of $1-billion, a run equalled only once before.”

A bit chunk of the investment was just land with 52% of all of the activity purchases for residential and commercial land. RealNet said the first quarter was the best ever for deals over $10-million in a quarter with the total of 24 beating the record set in fourth quarter of 2009.

There were eight deals alone in residential land component worth more than $10-million, five of which were in the city of Vancouver.

Some of the other big deals included the city of Surrey’s $22.14 million purchase of 58 acres of industrial land to complete a subdivision it will market for sale. Canada Post also bought 1.78 acres of land in Vancouver for $13.35-million that it plans to redevelop to accommodate a new state-of-the art mail processing centre.

On the office side, it recorded the largest climb in pure dollar numbers with six deals worth more than $1-million. CPP Investment Board scored the biggest deal by acquiring a 50% interest in two office towers for $115-million. The total for all six deal was almost $200-million at average price of $496 per square foot and average cap rate of 4.7%.

gmarr@nationalpost.com

Source: http://business.financialpost.com/2012/05/29/commercial-activity-in-vancouver-surges/

How to pick a real estate agent that suits your needs

Many factors contribute to the experience and success of buying and selling homes, but even in the digital age of a more transparent real estate market, working with a good real estate agent continues to be one of biggest impacts on either side of the transaction.

But how do you pick the right person to represent you or your home?

Before you just start asking your friends or digging through the fliers in your mailbox or hunting online, here are a few dos and don'ts you should seriously consider when selecting an agent.

Do:

Ask people you trust for agent recommendations, but take what they say with a grain of salt. Did they recently buy a home in your same price range? Have they had a successful time selling their home? Just because this agent worked out well for them does not guarantee the same experience for you.

Research. Most real estate websites, including Zillow, have online agent reviews. This can be a good starting place.

Find an agent that specializes in what you're trying to do. Don't select an agent who sells $2 million homes to help you find a $200,000 home. Check out current home listings. Do you like the photos, the description? Try contacting the agent to see if they're available for you.

Interview the agent. What is their specific marketing plan for your home? How will they negotiate so that you can be the winning bidder on your dream home? Why are they the best option for you? Can you call some of their past clients?

Set up expectations. What do you want from them? Outline your needs from the get-go so there won't be any surprises down the road.

Make sure you get along with the agent. You don't need to be best friends, but ultimately there should be some sort of rapport that allows for a successful business relationship.

Don't:

Pick friends or family. You don't want to jeopardize a friendship if the buying or selling process gets difficult. Also, be wary of hiring even a friend of a friend, or someone recommended. If you're serious about real estate, find someone that you can be honest and professional with. Unfortunately, that may not include your cousin or your best friend's spouse.

Pick someone who dually represents the buyer and the seller of the property you're looking at. They may not be able to fully transparent with you.

Be afraid to break up with your agent. Be honest and simply tell the agent it's not working out. List your reasons and be respectful.

If you're not quite ready to be tied down to a particular agent, it's better not to engage one until you've made a formal decision. You can communicate with an agent and ask for advice, but be clear upfront where you stand.

Source: http://www.mercurynews.com/real-estate/ci_20260470/how-pick-real-estate-agent-that-suits-your

Olive: Canadian real estate prices are falling – not the sky

Everything in moderation.

Recent homebuyers can’t be cheered by forecasts of a looming slump in house prices so soon after paying record prices in what may be the tail end of a 13-year-long Canadian housing boom.

But hold the Prozac.

First, while house prices are widely forecast to soften this year, no one’s expecting a U.S.-style crash of the sort that had prices in overheated markets like Florida, California and Arizona plunging by 70 to 90 per cent between 2007 and 2009.

That cataclysm set off defaults, foreclosures, a Wall Street meltdown, and the global Great Recession. By contrast, expect prices in admittedly overheated Canadian markets – conspicuously the GTA and Vancouver – to ease by 5 per cent to 10 per cent this year. And then to recover and begin making gains over purchase prices in 2013.

There’s an unduly alarmist tone to the latest forecasts of declining Canadian house prices. The headlines give one the impression of an imminent sharp fall.

A recent Maclean’s article linking patterns in Canadian residential real estate activity with record household indebtedness is headlined, “Time to panic about the housing market.”

Even a house fire isn’t something to panic over. You’ll just get in the way of the firefighters.

What we’re actually witnessing is a competent effort by the powers that be to prevent a torrid escalation in property sales and prices. Ottawa has been working on this for two years now, with frequent warnings to Canadians by the Bank of Canada and the federal finance minister to ease up on debt-financed consumer spending, including house purchases.

Mark Carney, the Bank governor, must have conspicuously warned at least half a dozen times over the past 18 months that today’s low interest rates “won’t last forever.” He should know, since he and his Bank colleagues set them. And the Bank has been keeping rates very low – a temptation to over-indulge in credit – in order to spur growth in Ontario’s ailing manufacturing sector.

Commercial banks have joined this coordinated effort to tamp down prices, tightening their lending standards to keep folks who can’t afford to carry a mortgage from attempting to do so. Meanwhile, since January they’ve also been engaged in a price war on mortgage rates that has made house ownership more affordable for existing mortgagees and prospective creditworthy buyers.

That’s the opposite of what U.S., U.K. and Spanish banks did in force-feeding mortgages in the 2000s to millions of buyers with no down payment, no collateral, no or little income, and a poor credit history.

The collateral damage from easing the pain with low interest rates for a Canadian manufacturing heartland that has received repeated blows to the gut since the early 2000s, long before the Great Recession accelerated the layoffs, is that money has arguably been too “cheap” for too long elsewhere in the economy.

That was the mistake, one of the biggest in central banking history, that Alan Greenspan, then chairman of the U.S. Federal Reserve Board, made in keeping rates near zero for years after the 9/11 attacks and the mild recession that followed. Which in turn spurred an unprecedented U.S. housing boom that ended in tragedy, with more than eight million Americans abruptly losing their jobs in 2008-10.

It may seem counterintuitive to wish for a slowdown in housing or any other (legal) market.

Yet when you consider that Toronto has in recent years been tied with Atlanta as the fastest-growing city in North America, adding the equivalent of a Calgary to its population every decade, you get a perspective on rising municipal costs that most city councillors and certainly the mayor don’t appreciate.

At 158 structures, Toronto has more skyscrapers and condo towers under construction than any North American city. The three runners-up combined – New York, Chicago and Miami – have 94. Time to apply the brakes.

It isn’t a legacy of wasteful spending that has the GTA in a financial bind. It’s building out municipal services to accommodate so many newcomers.

Cooling-off periods in Toronto property prices have characterized the GTA since the end of the Second World War, making it one of the most stable and lucrative housing markets in the world. What’s happening with prices today is no different. And this has kept Toronto relatively affordable for house buyers even as prices have steadily risen with only brief interruptions over the decades.

All movements go too far. Speaking of which, houses in downtown Detroit have hit rock bottom at $14,000 for a detached three-bedroom. So if the impulse in you to roll the dice on house purchases cannot be denied, think about picking up a six-pack of Motown properties whose price has nowhere to go but up.

Source: http://www.thestar.com/business/article/1144746--olive-canadian-real-estate-prices-are-falling-not-the-sky?bn=1

Canada Real Estate Assn:Hotspot Home Sales to Subside Slightly

--CREA Forecasts Very Slight Rise Home Resales Nationally in 2012

--Sees 0.3% Sales Drop in 2013, No Real Boost In Prices

OTTAWA (MNI) - Canada housing activity is subsiding from the overheated pace of sales and prices in some national hot spots, but it is a slow drop without any large correction, keeping the national sales pace essentially flat, the Canadian Real Estate Association said in its quartely outlook Monday.

CREA projects national existing home sales 458,800 units in 2012, up just 0.3% from 457,305 last year, driven largely by an expected 2.0% decline in Ontario -- Canada's largest province with more than a third of the population -- to 196,300 units from 200,323 in 2011.

For 2013, CREA forecasts sales to fall by 0.3%, with very slight gains in most provinces offset by a 1.7% decline to 192,900 units in Ontario.

Ontario, in the industrial heartland of Canada, has been suffering large manufacturing employment losses since the 2008 recession and considerable emigration of residents to resources-booming Western Canada.

CREA expects the national average home price to fall 1.1% in 2012 to C$359,100 (US$359,100). In the country's hottest spot, the West Coast province of British Columbia, average prices have been far above those of the rest of Canada, but are expected to drop 4.0% this year to $539,000 from C$561,304 in 2011, and then rise very slightly to $541,800 for 2013.

In Ontario, on the other hand, where Toronto-area condominium starts and sales have been another hotspot, raising home prices overall, CREA expects that to fall slightly to $364,000 this year from an average of $366,390 in 2011, and to not-quite recover in 2013 to $365,800.

After British Columbia, Ontario and Alberta, with an average of $353,390 in 2011, home prices across Canada are markedly lower and, according to CREA, are unlikely to rise greatly.

"Multi-million dollar sales activity in Vancouver caused the national average price to temporarily spike in early 2011," CREA said in a statement. "This phenomenon is not expected to recur in 2012."

Despite considerable debate by analysts and the Bank of Canada and the Finance Department about hot housing activity and an increasing burden of household debt, brought about in good part by prolonged historically low interest rates, CREA said national home sales activity for 2012 and 2013 "is projected to remain roughly on par with the 10-year average for annual activity."

"Risks to the Canadian economic outlook remain elevated owing to the European sovereign debt quagmire, but the continuation in low interest rates is the silver lining," said CREA chief economist Gregory Klump, noting low interest rates would continue to support Canadian home sales and prices.

Klump, however, indicated a caution along with his confidence, about those low interest rates --- just before the Bank of Canada issues a policy interest rate decision on Thursday, when it is widely expected to continue with the 1.0% rate that it has maintained for more than a year.

"Recent trends are reassuring, but interest rates remaining low for longer with doubtless keep the Canadian housing market under scrutiny for signs of overheating," he said.

** Market News International Ottawa **

Source: https://mninews.deutsche-boerse.com/index.php/canada-real-estate-assnhotspot-home-sales-subside-slightly?q=content/canada-real-estate-assnhotspot-home-sales-subside-slightly

Global real-estate markets continue promising trend

While economic uncertainty still affects the main commercial real-estate centres around the world, global real-estate markets are showing steady improvements, according to Jones Lang LaSalle's new suite of global forecasting reports.

The firm's Global Office Index reveals the fourth quarter of 2011 marked the eighth consecutive quarter where prime office rents have risen, up a further 0.8 per cent over the previous quarter and representing 6-per-cent growth over the fourth quarter of 2010. Global vacancy is edging down to the lowest point for the past two years at 13.6 per cent.

"The majority of global leasing markets are holding firm, and many are showing remarkable resilience, especially among the BRIC countries [Brazil, Russia, India and China], as well as robust showings from Canada, Australia, Germany and the Nordics," said Jeremy Kelly, director of Jones Lang LaSalle's Global Research team and author of the firm's Global Market Perspective. "While leasing markets in the major financial centres are softening, the limited supply pipeline should ensure that they do not move significantly out of balance."

Jones Lang LaSalle's Global Office Index tracks the rental performance of prime office space across 81 major markets in the Americas, Asia Pacific and Europe. Key findings of the Jones Lang LaSalle's Fourth Quarter 2011 Global Office Index include:

_ Rental growth rose the most in the Americas at 1.2 per cent in the fourth quarter over the third quarter of 2011, as landlord leverage gradually increased in the majority of markets.

_ Asia-Pacific markets saw rental growth decelerate from 2.5 per cent in the third quarter to just 0.9 per cent in the fourth quarter as corporate demand began to slow.

_ Despite the negative economic backdrop, Europe's office markets showed some improvement over the fourth quarter with growth picking up to 0.4 per cent from a virtual halt in third quarter 2011.

_ Leasing volumes will be steady in 2012 with positive rental growth expected in most major office markets. Beijing, Toronto and San Francisco are expected to top the charts with potential double-digit increases.

Investors, already wise to the resilient fundamentals in the commercial real-estate sector,

continue to choose real estate given its attractive investment status compared with alternative investments.

The Global Market Perspective shows robust capital market investment volumes in the fourth quarter 2011. A total of US$411 billion (Bt12.68 trillion) was transacted in full-year 2011, up 28 per cent on 2010. 2012 transaction levels are set to match 2011, with upside potential in the Americas.

Arthur de Haast, lead director of the International Capital Group at Jones Lang LaSalle, added that the markets are witnessing a "flight-to-quality", traditional in times of uncertainty, as investors pivot towards core assets in those major cities with strong economic fundamentals and/or with "safe-haven" characteristics. While there is capital available for commercial real estate, debt financing around the global will be more constrained in 2012. We're seeing capital appreciation slowing as yields flatten, and spreads between core and secondary assets widen.

While commercial real-estate expectations for 2012 have been tempered, barring significant financial system shocks, commercial real estate investment and leasing volumes are likely to be maintained at 2011 levels.

Source: http://www.nationmultimedia.com/business/Global-real-estate-markets-continue-promising-tren-30175734.html

Canadian home prices to gain in 2012

OTTAWA — Canada's housing market will continue to be strong this year, with rising property values expected in all major markets, real estate brokerage firm Royal LePage said Thursday.

The company's forecast called for prices across to country to rise 2.8 per cent by the end of 2012, after stronger gains last year.

Even pricey housing markets in Metro Vancouver and Toronto — where standard two-storey homes averaged $1.1 million and $629,188, respectively, in the last quarter — will see continued price appreciation in 2012, though the gain for Metro will be more muted, according to the brokerage firm's forecast.

Metro Vancouver is expected to see its average house price climb 2.3 per cent to $802,000 in 2012, while Toronto is expected to see a 2.6-per-cent jump.

"Widespread calls for a major real estate correction in 2012 simply can't be justified," Royal LePage CEO Phil Soper said in a statement. "The industry has significant momentum entering the year, and buoyed by the stimulative effect of very low interest rates, we expect the market to continue to expand — albeit at a slower pace."

However, Royal LePage said stronger gains will be seen in cities benefiting from commodity-based economies, such as Calgary, Regina and Winnipeg, where price gains will be in the range of four to five per cent.

According to the company, in the fourth quarter of 2011, the average price of a standard two-storey home was $375,427, up 4.2 per cent from a year earlier. The average rate of a detached bungalow was up 6.1 per cent to $344,392, while condominiums gained 3.6 per cent to $234,680.

Statistics Canada reported Thursday that its new housing price index rose 0.3 per cent in November, following on a 0.2 per cent increase in October, and was up 2.5 per cent year-over-year.

Price increases in Toronto, Oshawa and Montreal offset declines in Calgary, Metro Vancouver and the Ontario metropolitan regions of Sudbury and Thunder Bay, the agency said.

In Vancouver, Statistics Canada said some builders offered promotional pricing in order to sell units, which helped push new-home prices 0.3 per cent in November from October, and made the

Builders in the other areas reported lowering prices in order to stimulate sales and remain competitive, while price increases elsewhere were attributed to higher material and labour costs.

The Canada Mortgage and Housing Corp. has forecast the average price of a listed homes for resale to be $363,900 this year, up 1.2 per cent from 2011. The Canadian Real Estate Association predicted that the average price would be relatively flat at $362,700. Both forecasts were made in November.

Source: http://www.vancouversun.com/business/Canadian+home+prices+gain+2012/5985432/story.html