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Elevator Advertising – Ad Networks Compete for Toronto Condos

Elevator advertising is not new, but today there’s a strong push to sign-up more buildings and secure new territory because of the increased value of the ad networks.  These unique media networks, which would probably prefer to be considered message delivery systems, are growing at exponential rates by offering property managers discount screens and free installation. Why?

How can these companies afford to practically give away their merchandise?

Visio Media in Toronto condo tower is captive audience - Tenant TV systemThe 18 inch flat screens now playing ads in thousands of elevators across Canada’s biggest urban centers represent just a fraction of an increasingly valuable closed-circuit broadcast TV network.  The system is emerging and getting lots of attention because it works!  The biggest players in the field are using programmatic messaging, allowing social media interaction and even using facial detection technology for measurement and dynamic ad delivery. That means that every unit is intelligent and responsive to its own immediate audience in real time. Visio Media flat screen ad network delivery system in condo tower elevator

Its a win / win for property managers and tenants as the ad network also carries other valuable information that makes ignoring the screen difficult.  When deployed in bank towers downtown, the system provides advertisers access to executive eyeballs, and even in condominium towers across the city it finds highly desirable and difficult-to-reach audience of affluent and influential urban consumers.

If you are sharing your elevator with a small screen, then it probably belongs to one of these four expanding elevator-media networks:

 

Captivate Network is among the oldest and most established elevator broadcasters; founded in 1997, Captivate now has a digital media company with a network of 12,000 high-resolution, flat-panel elevator and lobby displays in 1,800 premier office buildings across North America

Their marketing ascertains that Captivate’s in-office media provides entertaining content to 10+ million professionals during the workday from best-in-class providers. Captivate uses an intelligent ad delivery system that is very aware of local demographics, time of day and season when showing their advertisements to elevator occupants.

Here is their video wherein they outline their pitch to property managers.

 

VISIO Media

Visio Media has a nationwide network with buildings in Calgary, Toronto, Edmonton and Vancouver.  This is what the company did with the money they received from an accelerator Accelerate Fund Invests in Visio Media in October 2017, and unlike Captivate which targets commercial properties, this Edmonton based startup is more focused on urban residential towers.

Visio Media’s Elev8 system strives to help businesses impact ready-to-spend urban residents with their advertisements, while enabling property managers’ communication with their residents.  Visio Media has the most technologically advanced elevator flat screen display network in the marketplace.  Each 18-inch screen mounted in the top corner, above the door in the car, has a tiny camera and software that scans shapes of faces and bodies of occupants to perceive certain determining factors. The data collected can include height, facial hair and face shape and these factors combined with others are used to determine gender and age. That information along with time of day and season are used to determine the best ads to display.  This ‘patented anonymous detection system’ is considered non-invasive photo recognition technology because none of the media is recorded; there is no record of the passengers in the car other than ridership stats. Below is the video from their website.

 

Pattison Onestop

Perhaps the most visible player in this space is Pattison OneStop and that’s because they have the deal to put 15″ elevator screens and 46″ lobby screens (the largest in the industry) above the subway platforms in three of Canada’s busiest cities.  Given this very auspicious and exclusive media broadcast space, they have evolved unique content which is a blend of real-time news, weather and entertainment programs that mirrors CP24 in some respects.  They focus on helping commuters and so traffic information and especially public transit delays are priority messaging on their screens. Their network has an estimated reach of 1.1 million across the country, and is available in seven urban markets: Vancouver, Calgary, Edmonton, Toronto, Ottawa, Montreal and Halifax.

When it comes to business towers and residential towers, Pattison systems are not found inside the building elevators like the first two competitors listed above, but rather they focus on the high traffic areas in front of the elevators.  They have partnerships with several high profile property management companies across the province; firms like Minto, Oxford and Homestead, plus their own sales force have grown their Ontario Residential Network to 680+ buildings. Here is their video,

 

MaxTV logo

MaxTV Media is the smallest and hungriest player on the scene; this local enterprise was born here in Toronto and is rapidly expanding by offering discount hardware and service in Brampton, Mississauga, North York, Vaughan, and Markham area condominiums.  MaxTV is building an ad network by promising to ‘evolve’ the old school tenants’ Interactive Digital Notice Boards.  What is that you might wonder?  If you lived in large condominium buildings in the 2000s you would have seen flat screen TVs used as message boards with line after line of updates posted by residents and staff.   MaxTV Media has evolved, or is evolving a better system of delivering notices. Their website boasts that their 1,089+ installations now reach 167,845 + Residents and have delivered 23,055+ Notices.  You can watch the MAX TV  video presentation online here.

Elevator Advertising is an ‘up and down’ business model.

Elevators are socially awkward environments where even the most confident and self-assured individuals tend to look at their feet and fidget with their keys.  Elevator advertisements give peoples’ eyes a welcome place to rest; riders can now intake visually rich and relevant information such as headlines and appealing images from the day’s news, stock quotes, and weather and clever advertisements.  For residents and business executives who can put their minutes in the elevator to better use, the screens are easily ignored, since they are small and often don’t emit any sound. But for most riders, the screens are highly effective instruments for information delivery.  Connecting these TVs together makes an effective ad messaging network, and that is the big prize that drives these companies forward and why they are offering Toronto area property managers such great deals today.

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What Is Pop-Up Staging? Budget-Friendly Home Staging at Its Best

| Mar 2, 2017

In this HGTV-saturated era, most home sellers have heard of home staging, a practice of arranging furniture in your home to make it look as alluring as a photo spread in a design blog. But what is pop-up staging? Consider it the bargain alternative that uses fold-out “fake” furniture for a fraction of the price of actual home staging.

Pop-up staging has taken off in the past few years, because the benefits of traditional home staging are undeniable: According to industry data, staged homes sell 88% faster and for 20% more money, on average. Still, traditional staging is not cheap: Staging fees for a 2,000-square-foot home will typically run in the $7,000 range. One reason for this high cost is that the furniture takes up so much storage space between gigs.

“As a traditional home stager, I had acquired 30 homes’ worth of furniture,” explains Karen Nielson, adding that she (and by extension, her clients) had to pay to store it all in a warehouse, have it hauled in a moving truck to clients’ homes, then returned again to storage.

Hoping to curb these costs, Nielson founded Dandy Pack, a pop-up staging company which creates the illusion of furniture with cardboard boxes draped in slipcovers. Rather than using vast warehouses and moving trucks, Nielson can now fit a whole home’s worth of furniture in a car, and change the look of the pieces by changing the slipcovers. Plus, from a distance (or in listing photos), Nielson says, you can’t even tell it’s “fake.”

How much does pop-up staging cost?

A starter kit from Dandy Pack, which includes a bed, couch, ottoman, and chair, costs $1,031, which represents significant savings. Plus, for someone going the DIY route, pop-up staging has the advantage of being portable and easy to assemble; stagers say it would be simple to go from an empty house to fully staged in one day.

Beyond the cost and ease of setup, pop-up staging may trump traditional staging in another key way: by maintaining a neutral home decor style that won’t rub sellers the wrong way.

“Conventional staging with real furniture involves choosing a style—with its patterns, colors, art, and accessories,” says Douglas Pinter, an industrial designer behind inFormed Space, which rents out foldable “prop” furniture, delivered in two rolling bins. Cost: $1,899 to $2,199 for two months. Best of all, the white furniture gives people a sense of a room’s scale so they can imagine how a sofa would fit, without being overwhelmed by a shabby-chic aesthetic, for example, if that’s not their thing.

What are the downsides of pop-up staging?

While pop-up furniture may save you money, you do run the risk that certain buyers might be turned off when they realize the furniture is fake. Especially with top-of-the-market properties, buyers might wonder where else you’ve tried to cut corners to save a few bucks.

And depending on how much furniture you already own, the cost savings might not be that great. If you’ve got some great pieces already and a good eye, you might save more money staging with what you’ve got.

Still, if your home is empty, pop-up staging can save some serious coin. Plus, if you’re worried that the pop-up furniture doesn’t look natural, you can try a hybrid—i.e., mixing large faux pieces with smaller real pieces like end tables and accessories.

 

See article: https://www.realtor.com/advice/sell/what-is-pop-up-staging/

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Why Toronto’s condo rental market is described as ‘ridiculous’

Every day it feels like there is another headline about how impossible it is to buy a house or condo in Toronto.

But have you tried renting lately?

“The competition is fierce,” says real estate agent Dena Schiff, who works solely with clients looking for rentals.

Open houses and bidding wars, she says, are now just part of the game.

The cites the example of a recent listing in the Bay Street and Bloor Street West area for $1,800 a month.

The condo owner hosted an offer night. Instead of meeting agents in real life, he used FaceTime — asking each to make a “best offer.”

“It was pretty ridiculous,” said Schiff.

Ridiculous, you’d think, considering all that construction downtown, right?

Not quite, if you were to listen to Shaun Hildebrand, senior vice president for Urbanation, a real estate consulting firm.

“The Toronto rental market is the strongest it’s been in three decades, and a lot of [it] has to do with what’s been happening in the ownership market,” said Hildebrand.

“There is such a lack of affordable entry-level homes for sale, and prices are rising so quickly, that more and more would-be first-time buyers are being pushed out of the market and are renting for longer periods of time.”

It’s a sentiment borne out by data and echoed by real estate watchers interviewed by CBC Toronto.

Condo apartment rentals dropped in 2016

The number of condo apartments rented through the Multiple Listing Service (MLS) during 2016 in the Greater Toronto Area dropped two per cent to 26,602 units, according to January report released by the firm. That’s the first annual decline reported by Urbanation since it started monitoring the data in 2011.

Condo rents rose 12 per cent in the fourth quarter of 2016 compared to the same period in 2015, with the average condo now renting for $30.80 per square metre ($2.77 per square foot), or $1,990 per month, says Urbanation.

According to another analysis by the Toronto Real Estate Board, the average rate for a one-bedroom condo apartment listed on MLS in the fourth quarter of 2016 is $1,776, up 7.4 per cent from the previous year.

That comes after successive year-over-year increases of 7.2 per cent, 6.4 per cent and 4.8 per cent for each of the previous three quarters.

“The Toronto rental market is out of control,” said Geordie Dent, executive director of the Federation of Metro Tenants Associations.

According to the Canada Mortgage and Housing Corporation’s 2016 data, the condo apartment vacancy rate is at one per cent — the lowest in seven years, the housing agency says.

“And because of that, rents are shooting through the roof. You go to a showing in some parts of town, you’re going to have a lineup around the block,” Dent said.

The low supply squeeze

You’d think with all those cranes in the sky, supply wouldn’t be an issue.

But once again, Hildebrand says, not quite.

The majority of new builds in Toronto are condos. Last year 18,000 condo units completed construction, down from 19,700 in 2015, and 21,000 in 2014, according to Urbanation’s analysis.

“It directly impacts supply growth in the rental market,” says Hildebrand. “And that’s exactly what we’re seeing right now.”

About 50 per cent of all new condo units are bought up by investors, who then turn them over to tenants.

Hildebrand says what’s desperately needed is purpose-built rentals.

Last year, just 1,700 rental units completed construction, he notes.

“There needs to be something done to encourage developers to build more rentals — allowing them more density or some kind of financial incentive, reduced developer chargers or lower interest rates.”

Hot housing market

And then there’s that fading dream of owning a home in the city.

Stricter mortgage rules and skyrocketing home prices are keeping many millennials renting longer.

“Prices are rising by 20 per cent year-over-year,” Hildebrand said.

“Each year it’s getting tougher and tougher for first-time buyers to get into the marketplace, so they’re renting.”

The mortgage rules boil down to a stress test for all insured mortgage applications.

The test is to determine if a borrower could afford to pay back a loan if the rate was higher, so a borrower will be judged against the five-year standard rate of 4.64 per cent for a five-year loan, even though many lenders are currently offering mortgages at far less than that.

Previously, that test was only used on certain segments of the market. But as of last October, it’s now in place for any insured mortgage for a buyer putting down less than 20 per cent of the home price up front.

“Partly because it’s so difficult to buy a home now in the Toronto area, it’s forcing, perhaps, a lot of would-be buyers into the rental market — which makes the rental market even tighter,” said real estate lawyer Mark Weisleder.

Everyone wants to live here

The secret’s out —  Toronto’s a great place to live.

“We’re seeing immigration levels to the GTA at 10-year highs, population growth in the core growing very quickly, and a robust job market as well that’s leading to stronger rates of household formation for the millennial generation,” said Hildebrand.

That has driven demand for rentals, he says, to a 30-year high.

Census figures show the City of Toronto grew 4.4 per cent between 2011 and 2016.

But much of that growth is concentrated in large swaths of the downtown core, which has seen major new condo construction since 2011. (Some neighbourhoods grew by 50 per cent, adding tens of thousands of new residents.)

Nicole Meredith wants to know what the city’s decision-makers are doing to make rent in condo-apartments more reliable and stable. Her rent recently spiked $500/month.

The Toronto Foundation’s recent vital signs report notes Toronto’s outsize growth since the start of the century, saying that growth between 2001 and 2014 in Toronto was equivalent to 87 per cent of the total population of Calgary in 2015.

“Forty per cent of Toronto’s youth who moved here within the last five years did so for better opportunities,” the report says.

But judging by the hundreds of young people who have written to us, many are still struggling to find an affordable place to call home.

But finding an affordable place to call home when they get here is a real struggle, according to a number of young people who reached out to CBC Toronto with their stories.

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Toronto’s home prices in line with other world cities

The majority of interest in residential properties comes from families, says a CBRE real estate expert.

Bubble. What bubble?

Toronto’s soaring home prices are in line with the reality of other world cities such as New York, Hong Kong and London, says Mark Renzoni, president of global commercial real estate giant CBRE.

“The market is fairly balanced. It’s not being driven by foreign capital. It’s being driven by Canadians, moving up, buying for the first time,” he told the Star, following a speech at CBRE’s annual market forecast event.

“There’s great jobs, there’s a sense of optimism, there’s confidence in the job market and interest rates are low,” said Renzoni, who suggested that concerns about foreign speculation in the Toronto housing market are overblown.

“In Toronto, I would say the majority of foreign interest on residential, especially high rise. . . It’s families. They’ve got students in university here, they’ve got other relatives here, they’ve got one spouse here. They’re buying additional residential real estate because they believe in the investment grade quality of the product,” he said.

On the high-rise side, Toronto condos are very fairly priced when compared to other global cities, said Renzoni.

“Even in a Canadian context, condominium pricing in Toronto is significantly lower than in Vancouver, significantly lower — discount lower — than New York or London. It’s still balanced and it still creates a great opportunity for people to create wealth and expand their horizons with investment. But also they’re buying for themselves. You have to live somewhere,” he said.

“The marketplace here is really driven on fundamentals, which is supply and demand,” he said.

Read more:

Toronto housing called a ‘bubble’ as new listings fall rapidly

Foreign buyers behind only 5 per cent of Toronto home purchases in 2016

Housing conditions problematic in several Canadian cities including Toronto, CMHC says

Newly built GTA home passes $1 million average price

Some bank economists have recently suggested that the Toronto area housing market is dangerously overheated.

The Toronto Real Estate Board has reported that re-sale home prices rose 20 per cent last year over 2015. January prices were up 22 per cent year over year in the re-sale market. The average cost of a newly built single-family home surpassed $1 million in the region last month, according to the building industry.

Renzoni said Toronto has attractive investment opportunities in the office, industrial, retail and multi-family development sectors.

He spoke to the Star following CBRE’s annual Canadian Market Outlook attended by about 1,400 brokers, developers and landlords at the Toronto Convention Centre on Tuesday.

At the same event, CBRE’s executive vice-president Paul Morassutti outlined the unprecedented technological change and unpredictable political landscape that will shape the market in the coming months and years.

“Change in every aspect of the market is inevitable, it is accelerated and it is ubiquitous,” he said citing geo-political uncertainty and technological innovation as the over-riding trends in tenant and investor demand for commercial real estate.

Morassutti cited the lack of coherent trade and policy positions emerging from the presidency of Donald Trump. Europe remains a question mark. Seventy-one per cent of foreign investment is Chinese and it’s not clear whether that country will find “a policy tourniquet” to stem the flow of capital leaving the country. Some reports are predicting that 47 per cent of jobs — 700 occupations — will be automated as artificial intelligence changes the face of work, he said.

But there’s no indication that the appeal of Canadian commercial real estate will decline in the near future, said Morassutti.

“Skittish capital is being driven to Canada,” he said, noting that investment activity was at record levels in 2016 with every asset class outperforming its 10-year average.

Trends on the real estate horizon

Retail: Online shopping isn’t killing retail, but it is separating the weak from the strong. Virtually every flagship mall in Canada has been expanded or renovated and experiential shopping is on the rise as retailers try and keep shoppers in their stores longer with attractions such as “foodie food halls” and high-tech golf driving ranges. Many retailers are reducing the number and size of their stores and focusing on the best locations.

Industrial: The line between industrial and retail space is blurring as e-commerce grows and customers demand faster delivery. In some cases, warehouse or industrial space — already a stable segment of the Canadian market — has effectively replaced bricks and mortar in retail. Online retailers need about 3 times the distribution space of brick-and-mortar retailers. Every $1 million in online sales comes with a corresponding requirement for 1 million sq. ft. of distribution space.

Residential: Affordability and lifestyle considerations are prompting younger Canadians to forgo home ownership just as the baby boomers are getting ready to cash in the equity in their homes and downsize. A recent uptick in purpose-built rental development will increase. “Condos have been the de facto rental in most cities. But there is a growing cohort who would prefer to live in a professionally managed building rather than deal with a condo owner in another country where you have no security and you’re in a building that quite often resembles a frat house,” said Morassutti.

Office: Will the demand for office space dwindle as white collar jobs become increasingly redundant due to automation? Morassutti suggests that the tech sector, which has driven demand for office space, could respond the way banks reacted when automation reduced their need for tellers. ATMs meant banks moved to smaller, cheaper branches and many bank teller jobs morphed into sales type positions introducing customers to banking products.

See article: https://www.thestar.com/business/real_estate/2017/02/28/torontos-home-prices-in-line-with-other-world-cities.html

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Toronto councillors call for province to protect tenants from rent increases

Councillors Ana Bailao and Josh Matlow are calling for the province to review the Residential Tenancies Act and look specifically at rent control.

A pair of Toronto city councillors are calling on the province to protect tenants from steep rent increases.

Coun. Josh Matlow and Coun. Ana Bailão will hold a special joint meeting of the Tenants Issues Committee and Affordable Housing Committee in early April, where they will ask the province to review the Residential Tenancies Act.

Most landlords are limited by provincial law in how much they can increase rent each year. But there’s an exemption for buildings built after 1991, where there’s no cap on increases.

That’s something Matlow, who chairs the Tenants Issues Committee, calls “unethical” and said creates two classes of tenants.

“Their rent can go up by hundreds if not thousands of dollars without any notice, and they’re in a real bind,” he said.

Because there are so few rental apartments on the market, one increase can mean tenants, especially young people and seniors, are “forced out of their own communities,” he said.

Matlow also wants the province to review the part of the act that deals with above guidelines rent increases for pre-1991 buildings.

He says landlords often use basic improvements to buildings to justify rent increases at the Landlord and Tenant Board.

The policy was originally introduced in the 1990s to provide an incentive for developers to build rental housing, but Bailão said she is concerned it’s not meeting its original goals. She added that the review must also look at the lack of rental housing supply to understand the bigger picture.

She’s worried that if something isn’t done soon, people just won’t be able to live near where they work or study in the city.

“These kind of rent increases are not healthy, are not sustainable, and at the end of the day, we’re all going to lose because of it,” she said.

Alejandra Ruiz, a member of anti-poverty group ACORN, which is mounting its own new campaign for rent control, says she hears stories of people faced with steep increases “all the time.”

“People are struggling to pay rent or buy food,” she said.

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No Fixed Address: A first-time renter’s guide to rental numbers in Toronto

Renting in Toronto, quite frankly, is tough.

Trying to find a place to rent? You can wind up shell-shocked over what a one-bedroom will cost you these days.

Toronto condo apartment rent

Plus, according to the Canada Mortgage and Housing Corporation’s (CMHC) 2016 data, the condo apartment vacancy rate is at one per cent — the lowest in seven years, the housing agency says.

But take solace: everyone else is trying to navigate renting in Toronto, too. In fact, there is a whole group of us on Facebook here. Join, discuss and vent.

Whether you are a first-time renter or a veteran of sorts, these are your must-know basics. Of course, this is no substitute for expert advice or additional research.

It ain’t cheap out here

According to the CMHC, as of Oct. 2016, the average monthly rent of a:

  • Bachelor apartment in Toronto is $957;
  • One-bedroom apartment is $1,132;
  • Two-bedroom apartment is $1,326.

This is roughly what you can expect to pay in the purpose-built rental market, which can include apartment buildings as well as row houses, the CMHC said.

Condo Craze

According to the CMHC, as of Oct. 2016, the average monthly rent of a one-bedroom condo apartment is $1,653. Meanwhile, TREB pegs it closer to $1,776. (Canadian Press)

But if you are seeking, say, a more modern condo apartment, the CMHC pegs your average monthly rent at:

  • $1,428 for a bachelor condo apartment in Toronto;
  • $1,653 for a one-bedroom condo apartment;
  • $2,029 for a two-bedroom condo apartment.

The CMHC compiles its data by surveying owners, managers and superintendents.

The Toronto Real Estate Board (TREB), however, tracks transactions on its MLS system to derive average monthly rents for condo apartments and its figures look like this as of Dec. 2016:

  • Bachelor condo apartment in Toronto is $1,512;
  • One-bedroom condo apartment is $1,776;
  • Two-bedroom condo apartment is $2,415.

Year-over-year condo apartment rent increase

According to TREB’s data, the average one-bedroom condo apartment rent was $1,776 in the fourth quarter of 2016 — an annual increase of 7.4 per cent compared to the fourth quarter of 2015.

Toronto condo apartment rent

A mere five years ago, a one-bedroom condo apartment would run you $1,626, according to TREB’s data from the fourth quarter of 2012.

Condo apartment Toronto increase

(CBC/TREB)

Do you have a 1-bedroom in stock?

If it feels like slim pickings out there, it’s because it is. The vacancy rate for condo apartments — one per cent — is at its lowest in seven years, according to the CMHC.

Toronto condo apartment vacancy rate

And as TREB noted in its Dec. 2016 report, rental transactions were down during the last three months of 2016 but not because of declining demand. There is simply a lack of units available to rent.

The real estate board says the number of condo apartments listed for rent during the fourth quarter of 2016 decreased by more than 14 per cent compared to the fourth quarter of 2015.

The 1991 exemption

Congratulations, you found yourself a decent pad. But do you know when your building was built? It matters, greatly.

The province sets a guideline for rent increases every year. For 2017, it is 1.5 per cent.

But there is a loophole — it only applies to units built before Nov. 1, 1991. So, if you live in a newer rental, you have no protection against an exorbitant rent increase.

Media placeholder

No fixed address: How I became a 32-year-old couch surfer1:38

That means your $1,650 monthly rent could balloon to $2,600, an increase similar to the one that forced CBC Toronto reporter Shannon Martin to leave her condo apartment.

While there is no limit on how much a landlord can increase your rent in newer buildings, they must give you 90-days notice and your rent can only increase once per year.

 

See article: http://www.cbc.ca/news/canada/toronto/renting-in-toronto-cheat-sheet-1.3995904

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Why Toronto’s condo rental market is described as ‘ridiculous’

‘Fierce’ competition for few units pushes prices higher as hot housing market keeps millennials in rentals.

At the end of January, Nicole Meredith got a big, unpleasant surprise.

The rent on her one-bedroom condo apartment in Queen West was jumping in just 90 days from $1,275 a month to $1,700 — a $425 spike.

“It was totally shocking,” says Meredith, 25.

Shocking, sure, but not entirely surprising in Toronto’s pricey, competitive rental market, where a lack of units is pushing prices to new heights as the hot housing market keeps millennials like Meredith renting longer.

Open houses and bidding wars are now just part of the game, says real estate agent Dena Schiff, who works solely with clients looking for rentals.

“The competition is fierce,” she says, citing the example of a recent listing in the Bay Street and Bloor Street West area for $1,800 a month.

The condo owner hosted an offer night. Instead of meeting agents in real life, he used FaceTime — asking each to make a “best offer.”

“It was pretty ridiculous,” said Schiff.

Graphic on vacancy rate

Ridiculous, you’d think, considering all that construction downtown, right?

Not quite, if you were to listen to Shaun Hildebrand, senior vice president for Urbanation, a real estate consulting firm.

“The Toronto rental market is the strongest it’s been in three decades, and a lot of [it] has to do with what’s been happening in the ownership market,” said Hildebrand.

“There is such a lack of affordable entry-level homes for sale, and prices are rising so quickly, that more and more would-be first-time buyers are being pushed out of the market and are renting for longer periods of time.”

It’s a sentiment borne out by data and echoed by real estate watchers interviewed by CBC Toronto.

Condo apartment rentals dropped in 2016

The number of condo apartments rented through the Multiple Listing Service (MLS) during 2016 in the Greater Toronto Area dropped two per cent to 26,602 units, according to January report released by the firm. That’s the first annual decline reported by Urbanation since it started monitoring the data in 2011.

Condo rents rose 12 per cent in the fourth quarter of 2016 compared to the same period in 2015, with the average condo now renting for $30.80 per square metre ($2.77 per square foot), or $1,990 per month, says Urbanation.

According to another analysis by the Toronto Real Estate Board, the average rate for a one-bedroom condo apartment listed on MLS in the fourth quarter of 2016 is $1,776, up 7.4 per cent from the previous year.

‘The Toronto rental market is out of control.’ Geordie Dent, Federation of Metro Tenants Associations

That comes after successive year-over-year increases of 7.2 per cent, 6.4 per cent and 4.8 per cent for each of the previous three quarters.

Condo apartment Toronto increase

(CBC/TREB)

“The Toronto rental market is out of control,” said Geordie Dent, executive director of the Federation of Metro Tenants Associations.

According to the Canada Mortgage and Housing Corporation’s 2016 data, the condo apartment vacancy rate is at one per cent — the lowest in seven years, the housing agency says.

“And because of that, rents are shooting through the roof. You go to a showing in some parts of town, you’re going to have a lineup around the block,” Dent said.

Amanda B

Amanda says she’s having a hard time saving for any kind of future in the city. (Grant Linton / CBC Toronto)

The low supply squeeze

You’d think with all those cranes in the sky, supply wouldn’t be an issue.

But once again, Hildebrand says, not quite.

The majority of new builds in Toronto are condos. Last year 18,000 condo units completed construction, down from 19,700 in 2015, and 21,000 in 2014, according to Urbanation’s analysis.

“It directly impacts supply growth in the rental market,” says Hildebrand. “And that’s exactly what we’re seeing right now.”

About 50 per cent of all new condo units are bought up by investors, who then turn them over to tenants.

‘There needs to be something done to encourage developers to build more rentals.’– Shaun Hildebrand, Urbanation 

Hildebrand says what’s desperately needed is purpose-built rentals.

Last year, just 1,700 rental units completed construction, he notes.

“There needs to be something done to encourage developers to build more rentals — allowing them more density or some kind of financial incentive, reduced developer chargers or lower interest rates.”

Hot housing market

And then there’s that fading dream of owning a home in the city.

Stricter mortgage rules and skyrocketing home prices are keeping many millennials renting longer.

Shaun Hildebrand

Urbanation’s Shaun Hildebrand says a slowdown in condo construction directly impacts the supply growth in the rental market – exactly what we’re seeing right now. (Urbannation Inc.)

“Prices are rising by 20 per cent year-over-year,” Hildebrand said.

“Each year it’s getting tougher and tougher for first-time buyers to get into the marketplace, so they’re renting.”

The mortgage rules boil down to a stress test for all insured mortgage applications.

The test is to determine if a borrower could afford to pay back a loan if the rate was higher, so a borrower will be judged against the five-year standard rate of 4.64 per cent for a five-year loan, even though many lenders are currently offering mortgages at far less than that.

Previously, that test was only used on certain segments of the market. But as of last October, it’s now in place for any insured mortgage for a buyer putting down less than 20 per cent of the home price up front.

“Partly because it’s so difficult to buy a home now in the Toronto area, it’s forcing, perhaps, a lot of would-be buyers into the rental market — which makes the rental market even tighter,” said real estate lawyer Mark Weisleder.

Toronto condo apartment rent

Everyone wants to live here

The secret’s out —  Toronto’s a great place to live.

“We’re seeing immigration levels to the GTA at 10-year highs, population growth in the core growing very quickly, and a robust job market as well that’s leading to stronger rates of household formation for the millennial generation,” said Hildebrand.

That has driven demand for rentals, he says, to a 30-year high.

Census figures show the City of Toronto grew 4.4 per cent between 2011 and 2016.

But much of that growth is concentrated in large swaths of the downtown core, which has seen major new condo construction since 2011. (Some neighbourhoods grew by 50 per cent, adding tens of thousands of new residents.)

You can see the areas of greatest growth in the below image marked in red.

Toronto Population Map

This map shows the total population change distribution by neighbourhood within the City of Toronto using Census 2016 data (City of Toronto)

The Toronto Foundation’s recent vital signs report notes Toronto’s outsize growth since the start of the century, saying that growth between 2001 and 2014 in Toronto was equivalent to 87 per cent of the total population of Calgary in 2015.

“Forty per cent of Toronto’s youth who moved here within the last five years did so for better opportunities,” the report says.

But finding an affordable place to call home when they get here is a real struggle, according to a number of young people who reached out to CBC Toronto with their stories. 

Toronto skyline

Urbanation says 5,000 purpose-built rental units are under construction in Toronto, nowhere near the level required to keep up with demand.

For Meredith, who has been renting downtown since she was 18, the crunch might now be too much to handle.

“It’s definitely a possibility I won’t be able to afford to live here anymore,” she says.

 

See article: http://www.cbc.ca/news/canada/toronto/why-toronto-s-condo-rental-market-is-described-as-ridiculous-1.4000329

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Real Estate Roundup

Active Home-Building Industry Will Lead to More Demand for Warehouse Space

Strong consumer spending and the rise in housing construction activity are currently the prime factors for the incredible rebound of the U.S. industrial real estate sector, and experts say as home buying continues to increase, so will demand for warehouse space. — From NRE Online

To Buy or Not to Buy: That Is the Developer’s Question

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Don’t Want To Live In 905 Toronto? Well, A Ride To 416 Won’t Be Cheaper Either

The choice between buying a new independent house and owning a new condo in Toronto would soon be a difficult one. According to Canada’s leading real estate information services company, RealNet Inc., the price difference between a new single-family detached home and a new condo has reached almost $300,000 in February 2015.

Another company, BuzzBuzzHome’s information show the average price of a new independent home or townhouse was $733,578 in February, compared with $442,672 for a condo, reflecting a gap of $290,906. This means, the price of a new home has gone up 12 percent from the same period in 2014, but the price of a condo jumped just by one percent. BuzzBuzzHome is known for providing map based search results for all new residential properties.

The trend is similar to Vancouver, informed Brendan Pyne, RealNet Canada business development manager. In fact, Toronto is 10 years behind Vancouver when it comes to such kind of price difference in the housing market, he added. The shortage of new land to construct independent houses or townhomes forced many property developers consider high-density developments, resulting in thousands of options for condominiums in the greater Toronto area.

Though most of the land is in the 905 areas, it denotes Toronto’s congested suburbs, which is not a preferred address for many. However, the average price of a resale independent property in the 416 area is over a million now —  an increase of 8.8 percent from last year, the average price of a resale condo in the same area could be somewhere around $369,655, reflecting a slight decline from 2014.

With the current real estate scenario in Toronto, forget owning an independent house with a backyard; the average size of a new condo is just about 800 square feet, at least 125 square feet lesser from 10 years ago.

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Price gap between new houses and condos hits $300K in Toronto

The gap between the price of new condos and the price of new homes is widening in Toronto, hitting close to $300,000 in February according to RealNet.

RealNet figures show the average price of new detached home or townhouse was $733,578 in February, compared with $442,672 for a condo, a difference of $290,906.

And while the price of a new home is up 12 per cent from this time last year, the price of a new condo has inched up by just one per cent.

“It’s similar to the trend in Vancouver,” said Brendan Pyne, RealNet Canada business development manager. “Toronto is 10 years behind Vancouver in terms of the difference in the housing market.”

There is a limited amount of new land for single-family dwellings, most of it in the 905 area, he said.

That’s forced developers to consider high-density development and thousands of new condos are under construction or coming onto the market this year.

“I would say the main factor driving the gap in the Greater Toronto Area is green land legislation that restricts the ability to grow outward,” Pyne said.

Vancouver ran into the same limits 10 years ago, he added.

There is intense demand for both new and resale single-family homes, so much so that Toronto real estate prices have continued climbing, even as real estate markets in other cities begin to slow.

The average home price for a detached resale house in the 416 area is now over $1 million and is up 8.8 per cent from a year ago. The average price of a resale condo was much lower at $369,655, a slight decline from last year.

For young Toronto families that presents the possibility that they’ll never own a home with a backyard.

And while detached and semi-detached homes are out of reach financially, condos may not be big enough for couples with children. The average size of new condos is shrinking and currently stands at about 800 square feet, 125 square feet less than they were 10 years ago.

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