Since the coronavirus pandemic trickled across Canadian borders more than a year ago, immigration to Canada essentially came to a halt, with ripple effects across Canadian real estate markets. Despite Ottawa’s ambitious plans to welcome more than 400,000 newcomers to the Great White North, only 184,000 successfully immigrated to Canada, down 50 per cent from the previous year. This was the lowest level since 1998.

But now that the world is slowly emerging from the depths of the COVID-19 public health crisis, the federal government is attempting to open its borders again to more than 400,000 immigrants annually beginning this year. The current proposal calls for 401,000 immigrants in 2021, another 411,000 in 2022, and 421,000 in 2023, bringing the total to approximately 1.2 million over a three-year period.

How will these numbers affect the post-pandemic economic recovery? And, considering how strong it has been over the last 16 months, even without new immigrants, how would these levels affect the Canadian real estate market? The early estimates suggest that this migration will not only encourage a substantial economic boom, but greater immigration levels would also continue to support the Canadian housing market, albeit at a modest pace.

How Will Immigration Help Local Real Estate Markets in Canada?

Speaking in an interview with The Georgia Straight, Royal Bank of Canada (RBC) senior economist Robert Hogue does not believe the influx of Canadian immigrants will substantially increase housing prices, although they could provide support during a downturn. However, at the same time, Hogue thinks immigration will serve more as “a safety net” for the next couple of years.

“When we look back over the past 15 months, the drop in immigration hasn’t done anything to weaken home prices or home resale activity,” Hogue said. “And so to go forward, it might not necessarily have the opposite effect of boosting prices per se, at least in very short order.”

While it is unlikely the Canadian real estate market would endure a U.S.-style collapse comparable to the 2008-2009 Great Recession, immigration would act as “a supportive factor on a go-forward basis.”

It is also important to remember that newcomers are not arriving at the border without nickels in their pockets. These permanent residents are carrying money for their settlement, not to be a financial burden for Canadian taxpayers. This is terrific news for the housing sector, particularly for sellers, since they could perhaps sustain the enormous demand from the last year.

But immigrants’ support of the country’s housing sector might not be equal since many newcomers locate to the major urban centres, such as Toronto, Vancouver, Ottawa, and Montreal. Now that Atlantic Canada is slowly becoming a critical hub for economic growth, will more home-buying immigrants be drawn to destinations like Halifax or St. John’s? Until that becomes a reality, industry experts will be monitoring the key metrics to determine immigration’s impact on buying and selling detached and semi-detached homes and condominium units.

It’s hard to get a full view of the impact of reignited Canadian immigration without looking at the other crucial segment of Canada’s housing industry: the rental market.

Will Immigration Also Support the Rental Market?

When immigrants newly come to Canada, they usually rent an apartment or a condominium unit in a rental market like Toronto or Vancouver. Even temporary visitors, such as those on a work visa or are attending a well-known university, take up some of the tight rental supplies, further fuelling prices. Is this set to happen again in the coming years?

As the pandemic economy begins to subside, people are, once again, clamouring to live in small units in the big cities. Despite the idea that suburbs and rural communities would be experiencing substantial growth on the other side of the lockdowns, people are being called back to the office, and thus, the demand for urban rental units grows.

Suffice it to say, professionals will need to live where the jobs and schools are again, even if it is expensive.

Immigrants Will Always Have a Home in the Canadian Real Estate Market

How much money did the world save during these chaotic times?

During the pandemic, there has been a lot of speculation as to what Canadian consumers would do with their pent-up savings. It is estimated that households accumulated approximately $167 billion last year, and many financial analysts believe this will be put into the lucrative housing sector. In this same vein, it is fair to assume that a good percentage of immigrants, many of whom endured the same stay-at-home orders in their countries of origin, have also put together a handsome windfall before moving their families to the Great White North. Whether these pent-up savings will be applied to the Canadian real estate market, or other parts of the economy, remains to be seen.

Either way, after more than a year of lacklustre growth, the Canadian economy could enjoy a significant cash injection over the next few years – and that is good for every sector!

New principles becoming effective December 31, 2021 will acquire useful changes for land owners the Agricultural Land Reserve (ALR). As per the common government:

"Alternatives for an extra little optional home have been added to guidelines, permitting ranchers and ALR landowners to have both a main home and little auxiliary home on their property with a smoothed out endorsement measure. Just authorizations from neighborhood government or First Nations government will be required, and there will be no application to the Agricultural Land Commission (ALC).

The extra home can be utilized for lodging more distant family, agritourism convenience, lodging for ranch work or an investment property for supplemental pay. There could be presently not a necessity that extra homes should be utilized by the landowner or close relatives.

Examples of flexible housing options permitted under the regulation include, but are not limited to:

• garden suites, guest houses or carriage suites;
• accommodation above an existing building;
• manufactured homes; and
• permitting a principal residence to be constructed in addition to a manufactured home that was formerly a principal residence.

Cultivating families can keep on applying to the ALC for various, bigger homes in case they are vital for cultivating purposes."

For more data, kindly visit

https://news.gov.bc.ca/releases/2021AFF0043-001352 as well as https://www.alc.gov.bc.ca/assets/alc/assets/legislation-and-regulation/the-act-and-regulation/oic_438_2021_additional_residences.pdf.

Q&A with REBGV Chair Taylor Biggar

Metro Vancouver’s housing market is experiencing record home buyer demand.

What do hopeful home buyers need to know to successfully navigate this hectic market?

We sat down with Real Estate Board of Greater Vancouver (REBGV) Chair Taylor Biggar to find out.

Q: What advice do you have for someone who’s just starting their home buying journey in this market? 

Taylor: The number one thing is surrounding yourself with professionals who can advise and guide you through this journey. People with context and insight to help you through what can be an emotional process. Have your team together before you make decisions about where you're going. 

That means finding the right REALTOR®, they’ll be your key advisor throughout the process. You’ll also want to find a mortgage broker, lawyer, and home inspector.  Having this team in place will put you ahead of the game when you're in a competitive market. You've basically got everybody in place already and can make better, more informed and timely decisions. 

Q: What other legwork can a buyer do before they start house hunting? 

Taylor: Get pre-approved by a financial institution or mortgage broker.

When you're looking for a home, you need to know how much money you’re working with and that you're qualified. This is critical – especially in a busy market.

Before you go to your mortgage broker or financial institution, you also need to have the paperwork outlining your income lined up. This paperwork depends on who you are. For example, there are different documents you’ll need if you're self-employed than if you’re an employee. 

Q: You’ve assembled your team, been pre-approved for a mortgage, and found a potential home. You’re ready to make an offer. How can I help ensure my offer is successful?

Taylor: Talk to your Realtor and research recent, comparable sales in your neighborhood to make sure your offer is both competitive and within your budget. If you make an offer at the limit of your budget, you’ll have no room to counter, and you might not be successful. 

Q: What about offers without subjects? 

Taylor: This can be risky. Make sure you completely understand your offer and what subjects are involved. Talk to your Realtor. 

Stay in your comfort zone and take as little risk as possible.

There are ways to mitigate your risk. For example, you can get a pre-inspection. This is where you don't have the offer together, but you hire an inspector to go in and do a report for you.

You can also remove other conditions before your offer as well. For example, you can remove conditions to documents like strata minutes and plans by getting them early. These actions can make your offer as clean and tight as possible. 

Also remember to speak with the rest of your team about any subjects you may want to include. For example, talking with your mortgage broker, you’ll learn that there are two sides to the financing equation. You may be pre-approved, but the property you’re putting an offer on is the collateral for your loan and no one’s appraised it.  

Q: Is there any other advice you can give to potential home buyers? 

Taylor: This may be one of the biggest financial decisions of your life and working with knowledgeable professionals is so important to making good decisions. 

Be patient. Don't stress, don't worry about it. These are market cycles. It's easy to get caught up in the hype. Don't get caught up in it because things change, and they change quickly. When they do, then suddenly there'll be different opportunities. Whatever decision you make, ensure it’s based on good information and advice based on experience.

Think about what the perfect lawn looks like. Is it green, weedless, and tidy?

This is starting to change.

Once a must-have, the green lawn is giving way to natural garden coverings. Low-maintenance, low-water use, and increased plant diversity attracts bees, birds, and insects. As an added bonus, these lawn alternatives don’t attract chafer beetles.

Bee lawn

Bee lawns contribute to the health and well-being of bees, one of our most beneficial insects whose numbers are rapidly declining. Made up of grasses and low growing perennials like clover, this mix can be treated like a regular lawn.

Edible lawn

Herbs, vegetables, berries and fruits – they’re terrific options when it comes to replacing part or all of your lawn. Look at kitchen garden designs for inspiration and you can freeze what you don’t enjoy for a taste of summer in winter.

For shade or part-shade areas, these plants will thrive:

• lettuce
• kale
• mustard greens
• mint
• parsley
• cilantro

In sunnier spots, you can’t go wrong with these:

• tomatoes
• potatoes
• carrots
• corn
• beets (add the leafy tops to your salad)
• basil
• chives
• oregano

Ornamental grasses

Drought tolerant and easy to grow, ornamental grasses can add  a variety of colours and movement to your garden. Large statement varieties provide additional interest in your garden. Laying paths and adding seating areas can enhance this space.

These attractive grasses will surely impress:

• Panicum virgatum 'Heavy Metal'
• Miscanthus Little Miss
• Miscanthus sinensis Gracillimus

Tapestry lawn

This type of lawn is a patchwork of colourful low-growing plants. These can include:

• woolly thyme
• lobelias
• chamomile
• veronicas
• yarrow

For higher traffic areas, use more robust plants.

Sedums

Colourful and low-growing, sedums flourish in sunny, dry areas. These low-maintenance plants will provide visual interest for a large part of the year, flowering from spring to late fall.

Metro Vancouver’s* housing market saw more moderate sales, listings and pricing trends in July compared to the heightened activity experienced throughout much of the pandemic.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 3,326 in July 2021, a 6.3 per cent increase from the 3,128 sales recorded in July 2020, and an 11.6 per cent decrease from the 3,762 homes sold in June 2021.

Last month’s sales were 13.3 per cent above the 10-year July sales average.

“Moderation was the name of the game in July,” said REBGV’s economist Keith Stewart. “Home sales and listings fell in line with typical seasonal patterns as summer got going in earnest in July. On top of moderating market activity, price growth has leveled off in most areas and home types.”

There were 4,377 detached, attached and apartment homes newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in July 2021. This represents a 26.4 per cent decrease compared to the 5,948 homes listed in July 2020 and a 25.2 per cent decrease compared to June 2021 when 5,849 homes were listed.

July’s new listings were 12.3 per cent below the 10-year average for the month.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 9,850, an 18.5 per cent decrease compared to July 2020 (12,083) and a 9.1 per cent decrease compared to June 2021 (10,839).

 “Low housing supply remains a fundamental factor in Metro Vancouver’s housing market,” Stewart said. "Home sales remain above average and we’re starting to see price increases relent as well. Going forward, the supply of homes for sale will be among the most critical factors to watch. This will determine the next direction for house price trends."

For all property types, the sales-to-active listings ratio for July 2021 is 33.8 per cent. By property type, the ratio is 25.5 per cent for detached homes, 47.8 per cent for townhomes, and 37.3 per cent for apartments.

Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12 per cent 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 properties in Metro Vancouver is currently $1,175,500. This represents a 13.8 per cent increase over July 2020 and is unchanged from June 2021.

Sales of detached homes in July 2021 reached 1,050, a 6.3 per cent decrease from the 1,121 detached sales recorded in July 2020. The benchmark price for a detached home is $1,801,100. This represents a 21 per cent increase from July 2020 and is unchanged from June 2021.

Sales of apartment homes reached 1,666 in July 2021, a 19 per cent increase compared to the 1,400 sales in July 2020. The benchmark price of an apartment property is $736,900. This represents an 8.4 per cent increase from July 2020 and a 0.1 per cent decrease compared to June 2021.

Attached home sales in July 2021 totalled 610, a 0.5 per cent increase compared to the 607 sales in July 2020. The benchmark price of an attached home is $949,400. This represents a 16.7 per cent increase from July 2020 and a 0.3 per cent increase compared to June 2021.           

A mortgage pre-approval is an important first step in the home-buying process. Having a pre-approval in hand tells you how much you can spend on a home, and it locks in the current low interest rate for up to 120 days, so you can shop the market knowing you’re insulated from rate hikes in the near future. If the rate drops, your lender should honour the new lower mortgage rate when you’re ready to make your purchase.

The amount that a financial institution is willing to lend for a mortgage depends on a number of factors. Your lender will check your financial standing to determine how much you can borrow, how much you can afford, and which loans might be best-suited to your specific circumstances. Applying for a mortgage requires a written application and supporting documentation, and it can be a slightly intimidating process. Here are three things lenders will want to know before giving you a mortgage pre-approval.

3 Requirements for a Mortgage Pre-Approval

The lender will check your credit score.
Knowing your credit score will give lenders an inside look at your credit habits and history, and will help them decide if you’re a good candidate for a loan. You’ll be ranked on a scale of 300-900. Your rating gauges your financial health and indicates the level of risk you present to the lender. High scores are good news, and will typically secure a better mortgage rate, since you post a lower risk of defaulting on your mortgage payments.

The lender will check your employment history.
Lenders will ask for a list of your past employers, how long you’ve been with your current employer, and what your annual salary or take-home pay is. They want to make sure you consistently earn money with no major gaps in income, and that you can make regular mortgage payments over the long-term.

The lender will check your assets and debts.
Be prepared to show your past income tax records, recent bank statements and current debt amounts, including credit card balances, car loan, student loan or line of credit. Lenders want to know your debt-to-income ratio to determine if you can make each loan payment based on the income you earn and your other financial obligations. The lender will also require proof of your down payment.

Many lenders offer a mortgage pre-approval online, so the process is simple. Find a mortgage lender that you’re comfortable with. If needed, your RE/MAX agent can provide a referral. Have more questions about the home-buying process, or ready to move forward with your purchase? Contact a RE/MAX agent today, or download the RE/MAX Home Buyer’s Guide, for everything you need to know about the purchasing process.

If you’ve heard the term “non-conforming strata” before, there’s something you should know: There’s no such thing, according to the Condominium Home Owners’ Association (CHOA).

Typically, this term is used to describe strata properties with less than five units.

However, a strata is legally defined as any property where a group of owners own their individual strata lots and together own the common property and common assets. There’s no special status for stratas under a certain unit threshold.

Many duplex, triplex, and four-plex owners try to manage their properties without formal meetings, bylaws, and strata fees. This makes their lots non-compliant with the Strata Property Act.

While technically legal, this arrangement can cause significant headaches.

Working outside the Strata Property Act

It’s in the best interest of the home owners to comply with the act – even if it’s a duplex or a triplex. Informal agreements can lead to messy legal situations.

Two Kelowna home owners learned this the hard way earlier this year. Since 2011, the neighbours shared maintenance costs as they came up. However, a surprise maintenance cost came up with no clear way to determine who was responsible for what costs.

The owners were also surprised to learn their duplex, like all duplexes in BC, were governed by the Strata Property Act.

This situation led to a three-year legal battle that ended in lost time, expensive court bills, and high-tension conflict. 

Complying with the Strata Property Act

CHOA has created an easy-to-understand guide to help strata corporations understand their responsibilities and day-to-day governance and operation.

To help make homes more energy-efficient, the federal government is offering up to 700,000 grants of up to $5,000 through the Canada Greener Homes Grant.

The goal is more than greener homes. It’s also to create new jobs for energy advisors, increase domestic green supply chains, and fight climate change.

What’s available through this program?

A total of up to $5,600 including:

• grants of up to $5,000 to help home owners make energy efficient retrofits to their homes, such as better insulation, electric heat pumps, new windows and doors; and
• EnerGuide evaluations worth up to $600 and expert advice to home owners so they can begin to plan their retrofits.

Who is eligible?

Home owners.

Eligible property types

• Single and semi-detached houses
• Row housing
• Townhomes
• All-season cottages
• Mobile homes on a permanent foundation
• Permanently-moored floating homes
• Mixed use buildings (residential portion only)
• Small multi-unit residential building (three storeys or less with a footprint of 600 sq. m or less)

Review additional requirements for small multi-unit residential buildings.

Not eligible

New homes aren’t eligible. Multi-unit residential buildings over three storeys or over 600 sq m in footprint aren’t eligible. Learn more.

The process

1. Learn about the initiative.
2. Apply - register and book the retrofit evaluation. You have to create an account first and login here.
3. Plan, document, and complete your home retrofits.
4. Book your post-retrofit evaluation and apply for reimbursement.
5. Receive your reimbursement.

Eligibility retroactive

Eligibility is retroactive to December 2020 for home owners who have had audits and work done and kept receipts.

Recruitment and training of EnerGuide energy advisors

The government plans to recruit and train 2,000 energy advisors.

Cost to taxpayers

This program is expected to cost $2.6 billion over seven years.

Learn more

• Ottawa Launces the Canada Greener Homes grant
• Canada Greener homes grant

Buyers and sellers with signed contracts that are legally binding have many contractual obligations. Here are a few examples.

Included items

The standard form, Contract of Purchase and Sale, contains this clause:

“The Purchase Price includes any buildings, improvements, fixtures, appurtenances and attachments thereto, and all blinds, awnings, screen doors and windows, curtain rods, tracks and valances, fixed mirrors, fixed carpeting, electric, plumbing, heating and air conditioning fixtures and all appurtenances and attachments thereto as viewed by the Buyer on the date of inspection...” (Clause 7: Included items).

The contract provides a space for additional items that are to be included or excluded, for example, washing and drying machines, curtains or even a stone garden bench.

If you are a buyer, and you have specified items that you want to be included in the contract and if these items have been removed when you take possession of your home, then talk to your REALTOR® and/or your lawyer as to whether the seller has breached Clause 7 of the contract.

Property condition

The standard form Contract of Purchase and Sale contains this clause:

“The Property and all included items will be in substantially the same condition at the Possession Date as when viewed by the Buyer...” (Clause 8: Viewed).

If the property’s condition is different when you take possession of your property, talk to your Realtor and/or your lawyer as to whether the seller has breached Clause 8 of the contract.

Other commitments

Buyers may impose a specific obligation on the seller, for example, to make repairs or to clean the property prior to the closing. Examples could include shampooing carpets, power washing the driveway, removing garbage and unwanted items, cutting lawns, and repairing fences.

Sellers (and buyers) are obligated to keep their contractual commitments. If a contractual commitment has been breached, consider talking to your Realtor and/or your lawyer as to your options.

Your Realtor and his/her brokerage may be able to help resolve this complaint by contacting the other party’s Realtor or brokerage to ask for assistance or to communicate your concerns.

Note: Your Realtor cannot force the other party to do what they said they would do in the contract. For this, you need the assistance of a lawyer or the Courts.

Subject to clauses

Buyers may wish to make “subject to” offers for example; subject to the buyer being able to obtain financing; subject to an inspection of the property and/or subject to legal advice. Sellers can accept an offer subject to the seller being able to find another suitable property within a specified period of time or subject to legal or financial advice. The parties must act in good faith and are expected to make reasonable efforts to satisfy and remove subject clauses from the agreement.

Note: A subject clause is not necessarily an “escape clause.” If the other contracting party does not believe you have made an effort to satisfy the subject clause he/she may consider that you have breached your contractual obligations.

Deposits

Deposits are most commonly held in trust by the buyer’s Realtor’s brokerage. Once deposit monies have been placed in the brokerage trust account they can only be removed from the trust account with the written approval of the buyer and seller. If the parties cannot agree, the real estate brokerage may pay the monies into court pending legal action that the parties may choose to take.

The BC Land Title and Survey Authority (LTSA), the publicly accountable, statutory corporation responsible for delivering secure land titles, is aware of two recent attempts at title fraud involving swindlers impersonating registered owners who live abroad. 

One attempt was successful and the property title was registered as owned by a fraudulent title holder.

In both cases of fraud, the property managers responsible for renting the homes took instructions from the fraudster from different phone numbers and email addresses than those authorized by the owners, and shared documents that enabled the fraudster to better impersonate the owners. 

Fraud is rare

The LTSA emphasizes that such cases are extremely rare because strong protections are in place in this province.

The LTSA reports that over the past 20 years, the land title system processed more than 16 million transactions. During this time, two claimants were paid from the assurance funds because of title fraud, four because of mortgage fraud and one because of a combination title and mortgage fraud. 

The LTSA is legally obligated to confirm ownership every time a property is sold, mortgaged, leased or statutory rights of way are created.

Assurance fund

Additional protection is provided through an assurance fund that compensates owners deprived of their title either because of an LTSA administration error or identity theft/fraud.

If the owner is innocent of all fraud charges, the assurance fund will cover all court costs and legal fees. The fund exists to provide confidence in the land title system and ”make things whole” again.

Home owners

Home owners can order a duplicate certificate of title for their own records, at a cost of approximately $50.

Title can’t be transferred without this document. While it provides protection, it can cause problems when a duplicate certificate of title is lost or misplaced.

LTSA is unaware of any cases in BC that required an innocent owner to pay off a fraudulently obtained mortgage on their property.

Title insurance

Typically, when a bank asks a home owner to pay for title insurance on a mortgage, that insurance protects the lending institution, not the home owner. However, separate insurance may be purchased that protects the owner’s equity in the property.