Ottawa-Gatineau Housing Market

[waterloowarrior]

Good catch, they have corrected that article to "low vacancy rates"

A huge component in the cost of housing is more fixed costs like land, servicing, design, fees and taxes. If you built a 1000 square foot home, it wouldn't cost half as much as a 2000 square foot home. Certain parts of the project like the second floor are also cheaper per square foot.

For example, in the Pathways project (Phoenix Homes) for 35 foot lot, a 1400 sq foot bungalow is $849,000 (607$ per square foot) while a 2700 sq foot 2 storey home is $979,000 ($363psf). The living space goes up by 93% for a 15% increase in total cost.

[rocketphish]

Royal LePage upgrades national year-end home price forecast as Canadian real estate market hits 'critical tipping point'

News provided by Royal LePage Real Estate Services
Apr 12, 2024, 03:30 ET

TORONTO, April 12, 2024 /CNW/ - Royal LePage is forecasting that the aggregate price of a home in Canada will increase 9.0 per cent in the fourth quarter of 2024, compared to the same period last year. Based on stronger-than-expected first quarter results, the previous forecast has been upgraded nationally and in most major markets.

According to the Royal LePage House Price Survey released today, the aggregate1 price of a home in Canada increased 4.3 per cent year over year to $812,100 in the first quarter of 2024. On a quarter-over-quarter basis, the national aggregate home price increased 2.9 per cent, an indication that sidelined buyers are rebooting their real estate purchase plans ahead of expected interest rate cuts, as predicted in January.


<snip>


Ottawa

The aggregate price of a home in Ottawa increased 4.4 per cent year over year to $757,700 in the first quarter of 2024. On a quarterly basis, the aggregate price of a home in the region rose by a modest 0.4 per cent.

Broken out by housing type, the median price of a single-family detached home increased 4.5 per cent year over year to $869,300 in the first quarter of 2024, while the median price of a condominium increased 4.6 per cent to $401,500 during the same period.

"The Ottawa housing market has seen a positive start to the year, with an uptick in activity persisting as we enter the spring market. With an anticipated drop in interest rates expected this year, buyers and sellers are regaining confidence and are beginning to come off the sidelines," said Jason Ralph, broker of record, Royal LePage Team Realty. "With this boost in market activity, we have begun to see more multiple-offer scenarios taking place, less so in comparison to the peak of the pandemic, but enough to put upward pressure on housing prices. I expect this momentum will continue into the summer and fall markets."

While the region's inventory levels have seen improvement compared to the previous year, there is still not enough supply to satisfy the growing demand.

"Demand for all housing types continues to outpace available supply in Ottawa. While we are seeing more product become available, we are still lacking enough inventory to satisfy demand, especially as buyer activity ramps up. I expect more sellers will be willing to list their homes if we see interest rates decrease in the coming months," added Ralph.

Ralph noted that new developments for both single-family homes and condominiums have picked up again as buyer demand surges. He predicts that this uptick in new developments will help alleviate inventory constraints, and anticipates an increase in new-build transactions this year.

"Looking ahead, I expect interest rate cuts will spur market activity further in Ottawa as more buyers and sellers jump back into the market. I believe we will see a robust spring market followed by even stronger summer and fall seasons, where we will really begin to see the benefits of lowered lending rates," added Ralph.

Royal LePage is forecasting that the aggregate price of a home in Ottawa will increase 4.5 per cent in the fourth quarter of 2024, compared to the same quarter last year.

Royal LePage House Price Survey Chart: rlp.ca/house-prices-Q1-2024
Royal LePage Forecast Chart: rlp.ca/market-forecast-Q1-2024


<snip>


https://www.newswire.ca/news-releases/ro...s-critical-tipping-point--885508755.html

[rocketphish]

Ottawa is funding affordable rental projects that aren’t actually affordable
Analysis of rental data reveals 87 of 177 rental projects approved through Ottawa’s Apartment Construction Loan Program exceed what a typical renter household can actually afford to pay

Rachelle Younglai, Erin Anderssen, Chen Wang
The Globe and Mail
Published April 12, 2024 | Updated Yesterday

When the $86-million low-interest loan for SoHo Italia apartment tower in Ottawa was announced in the summer of 2020, the federal government press release led with the line: “Every Canadian deserves a safe and affordable place to call home.”

The project would provide housing for the middle class and “those working hard to join it,” said Ahmed Hussen, the cabinet minister then responsible for the Canada Mortgage and Housing Corp., which lent the money under the largest program in the Ottawa’s national housing strategy.

Today, according to CMHC, all 250 units in the new building – which the SoHo’s website touts as “the finest luxury rentals in the city” – meet the loan program’s definition of affordability.

Except the average affordable cost for a SoHo apartment exceeds what a typical renter household can actually afford to pay. That’s also true for 87 of 177 rental projects approved through Ottawa’s Apartment Construction Loan Program (ACLP), a Globe and Mail analysis of CMHC rental data has found – data that highlight a disconnect between how the government has touted the program and what it is actually achieving.

The problem with the program, housing advocates say, is rooted in how CMHC determines affordability. Developers are eligible for the program’s low-interest loans if at least 20 per cent of their new units can be rented for less than 30 per cent of median household income of all families in the particular city where they are being built.

In the case of the SoHo, a 500-square-foot one bedroom starts at $1,760, plus utilities, which works out to about 17 per cent of the median household income for Ottawa, $125,520.

The rent looks much pricier when compared with a different number, one that experts say is a far better indicator of affordability – median income for renters. The median income for an individual renter in Ottawa is $41,800, which would make the rent for that SoHo apartment more than half of a typical renter’s income.

Even the median renter household in Ottawa – that includes two incomes – only makes $66,300 annually, according to the most recent data from Statistics Canada. This puts the SoHo’s two-bedroom, starting at $2,320 a month, out of reasonable reach as well.

By relying on median household income – which encompasses both renters and homeowners, who outnumber renters and have incomes that are nearly twice as high – CMHC is using a flawed base measurement to determine affordability, critics say.

The income gap between households who own and households who rent is wide. In Canada, median income for all families – renters and owners – is $98,390. The median income for a typical household that rents is $57,900.

The program, which now totals $55-billion after a top up this month from the federal government, has helped finance 31,840 rental units since its inception, according to CMHC data. The program also sets a cap on total rental income that a building can make but that’s still not enough to make a big difference.

What it considers “affordable” is out of whack with reality, said Steve Pomeroy, who runs his own housing policy research company, Focus Consulting Inc., and has analyzed the ACLP extensively.

Though, even if CMHC linked project financing to a lower affordable rent, developers say they wouldn’t be able to build because the cost of construction is prohibitive.

“Any supply is good,” Mr. Pomeroy said. “But if you’re pretending that it’s affordable, it’s not. That’s just deceitful.” It’s all the more problematic, Mr. Pomeroy said, that the program is the largest in the government’s national housing strategy, which is supposed to prioritize housing for “those in the greatest need.”

According to the Globe analysis of 177 projects funded through the program, half of the projects approved for loans had average affordable rents that are not affordable to the typical household that rents rather than owns. (The analysis relied on the national median renter household income).

For single-income renter households, only 11 are affordable. Minimum-wage workers could cover the rent in just nine projects. The Globe obtained the average affordable rents for those projects, which were awarded loans between 2017 and 2023, through an Access to Information Act request. That information has not been previously disclosed by CMHC.

One of the highest average affordable rents is at a 270-unit Winnipeg project designated for seniors, which received an $86.75-million loan. The average affordable rents are listed on CMHC documents as $2,018 per month. But the average market rent for a two-bedroom apartment in a purpose-built rental building in Winnipeg, according to CMHC’s latest rent report, is $1,427.

In some cities, CMHC’s affordability measure actually allows rents higher than what landlords could even expect to charge. In Winnipeg, four projects had higher average affordable rents than average market rent in the city. Developers are only required to maintain those rents for 10 years, although municipalities have often lengthened those timelines.

In fact, the ACLP defines an “affordable rent” that is so high that most renters would have to double their income to make their monthly payments. The median affordable rent falls at $1,447 for the projects. Compared with the monthly wages of 512 occupations provided by Statscan, the government’s threshold for affordability would be out of reach for 270 jobs, from cashiers to daycare workers to transport truck drivers.

Although the records released by CMHC provided a single number, described as the average affordable rent, for 177 of the ACLP projects, there were 19 projects where such a figure was not yet available.

CMHC declined to provide an average rent per unit size to The Globe, saying it was proprietary information for the developers. The Globe reached out to 30 developers; seven provided individual rents.

But while there’s no question that using a lower measurement such as median renter income would result in cheaper required rents, developers say that criticism overlooks an essential consideration – none of them would have built apartments for rents at that price because their profit margins would be too small or non-existent.

“Nobody would pursue the financing,” said Dan Dixon, senior vice-president of corporate affairs for Minto Group, a major Canadian housing developer that has borrowed through the program.

“It’s a delicate balance for CMHC,” he said. “They want to have social benefits, but the project math still has to work or nothing will get built.”

SoHo’s developer, Mastercraft Starwood, agrees. Its president, Bruce Greenberg, said the tower would not have been feasible with stricter affordability measures under the current program – and, given the rising costs of construction, could not be built again today under those same rules.

This explanation was even offered by some of the non-profit corporations that have borrowed from the program. The data show 20 such non-profits have used the ACLP to construct housing. Stephen Bennett, the CEO of Affordable Housing Societies, which is based in British Columbia, said he also did not believe that he could have made his project work if he had used median renter income as opposed to median household income.

When asked why CMHC opted not to use median renter income, a spokesperson for the agency emphasized the program’s impact on Canada’s housing supply shortage, saying the program has spurred construction of apartments that wouldn’t otherwise have been created. The vast majority of projects, however, still went ahead without the ACLP: The total units built account for only seven per cent of all new rentals started in the same period.

“The ACLP delivers below-market rents that are lower than what a new market development would rent at,” said Leonard Catling, a spokesperson for CMHC. “The ACLP focuses on creating purpose-built rental housing for middle-class individuals and families,” he said.

A review of government press releases shows the language it has used to describe the program has markedly changed over the years. In the first few years of the program, Ottawa stressed that it was available to borrowers who “want to build affordable rental housing in Canada.”

Over the past two years, however, the word “affordability” has largely disappeared from ACLP press releases, though it is still a requirement in the program.

Regardless of what the ACLP has helped build, the government’s definition of “affordable” does not sit well with a number of middle-income renters interviewed for this story.

In Victoria, a new project slated to be completed next year, will have average affordable rents of $2,028 for 100 of 105 units, according to the data released by CMHC.

“That is messed up,” said Kevin Savage, 48. He, his partner Christabel and his son were evicted from their two-bedroom condo in downtown Victoria in early 2023 after their landlord told them they needed the property for themselves.

His family had to settle for a rental about a 30-minute drive from downtown where they run their swing dance business, Red Hot Swing. They pay $2,100 a month plus utilities. They fill up their car as much as twice a week compared with every other week. They have added classes to help offset the higher rent and gas expenses.

In Halifax, a new project close to the university, will have average affordable rents of $1,993 per month for 43 of the building’s 101 units, according to the CMHC data.

“The average working individual in this province would not be able to afford that,” said Aundrea Cocco, a 31-year old accountant who spent a year looking for a place to rent in the Halifax region after she broke up with her boyfriend and could no longer afford the $2,200 townhouse they’d shared. Today, even with her 546-square-foot rental, she spends half her salary on housing costs.

“I’m a good example of somebody who has a decent career and salary base,” she said. “I should be able to easily afford to rent a one-bedroom. But you know, it was a struggle.”

https://www.theglobeandmail.com/canada/article-ottawa-affordable-rental-housing/

[rocketphish]

Feds look to offload office space faster, open military properties for housing
National Defence Medical Centre near General Hospital among 14 military properties up for divestment

Arthur White-Crummey · CBC News
Posted: Apr 16, 2024 4:04 PM EDT | Last Updated: 7 minutes ago

The federal government is committing $1.1 billion over the next 10 years to offload its office holdings more quickly, as part of a plan it hopes will spur housing conversions in Ottawa and beyond.

That came in the federal budget on Tuesday, which also announced plans to transform a former Ottawa military hospital into housing and lease land to build more homes on a shuttered east-end air force base.

Public Service and Procurement Canada has already set a target of cutting its office portfolio by up to 50 per cent. It has nearly 65 million square feet of floor space, most of it in the National Capital Region, and estimates about half is now vacant.

The new funding is meant to "accelerate the ending of leases" and cover the cost of deferred maintenance to help reach that target.

"This would enable more office buildings, particularly in urban areas, to be converted into homes for Canadians, while also ensuring the responsible use of government resources," the budget says.

The government expects that reducing the federal office footprint could save it $3.9 billion over 10 years, paying for the outlay of $1.1 billion many times over.

There's no guarantee that all that office space will be converted into housing, and some property could simply reenter the downtown Ottawa office market, adding to a vacancy rate that's currently running above 11 per cent.

But it's clear that the federal government wants to open up as many of its holdings as possible to residential use.

"Wherever possible, public land should be used for homes," the budget says. "Moving forward, the federal government will partner with the housing sector to build homes on every possible site across the federal portfolio."

The budget mentions a few specific Ottawa properties that have the potential for housing conversions. That includes the former National Defence Medical Centre near Ottawa's General Hospital.

The 375,000-square-foot, nine-storey brick building was built between 1960 and 1961 and operated as a military hospital that also served "political VIPs." It was designated as a heritage property in 2002.

According to the budget, the defence department will work with the Canada Lands Company, a Crown corporation that redevelops federal properties, to divest the hospital and 13 other unneeded military facilities across the country.

The federal government is also planning to "urgently" lease out land at the former Canadian Forces Base Rockcliffe for 500 new homes in the growing Wateridge Village community developed by Canada Lands. About 1,000 people already live there.

The budget announces plans to "overhaul" Canada Lands Company. That includes seeking to transfer land to the company for $1 to further affordable housing projects, instead of the current practice of selling it at market rates.

https://www.cbc.ca/news/canada/ottawa/fe...ilitary-properties-for-housing-1.7175539

[rocketphish]

Housing start numbers weak in province, worse in Ottawa
Data shows Ottawa housing starts down 64 per cent last month compared to April last year

Arthur White-Crummey · CBC News
Posted: May 22, 2024 4:00 AM EDT | Last Updated: 6 hours ago

Ottawa builders are off to a slow start breaking ground on new homes this year, according to new data from the Canada Mortgage and Housing Corporation (CMHC).

There were 331 housing starts within the City of Ottawa last month, compared to 908 in April of last year — a drop of 64 per cent. In urban areas of Ontario as a whole, the downturn was 37 per cent over that period.

For the Ottawa census metropolitan area, which groups the city with surrounding communities like Carleton Place, Ont., and Russell, Ont., the drop was 58 per cent.

CMHC economist Francis Cortellino said a key factor is persistently high interest rates, which make mortgages more expensive for home buyers.

"At the same time, for rental structures, financing costs for builders are quite important at the moment," he said. "It's difficult to have a project that would be financially viable, so this is why starts are so low in Ottawa right now."

The April downturn follows disappointing numbers from March, when housing starts fell 53 per cent in the metropolitan area relative to the same month last year. February saw a more modest drop.



Mayor Mark Sutcliffe said he is not yet worried by the data and remains optimistic Ottawa can meet its housing targets.

"Month to month and year to year there might be some ups and downs in the numbers; some of that may just be timing of when new homes were initiated," he said. "But overall, I think we're headed in the right direction."

Jason Burggraaf, CEO of the Greater Ottawa Home Builders' Association, took a similar view of the situation. If the same trends persist for several months more, he might get worried.

For now, he's chalking it up to "volatility" in the data as large apartment projects make up a bigger share of the market. Their timing can move the needle by hundreds of units at a time.

"You'll see big drops and you'll see big booms," he said.

Like Cortellino, Burggraaf sees interest rates as the primary challenge for home builders. A few percentage points can scuttle an otherwise viable project.

"You're trying to finance hundreds of millions of dollars to build a building right now, so that makes a big difference," he said.

Last month's downturn was driven by multi-unit apartment buildings.

Last April, there were 617 apartment unit starts in the City of Ottawa, while there were just 96 this April. That's a decrease of 84 per cent.

Single-family home starts were actually slightly up over the same period, but Cortellino noted that they were already at a low level last year. He explained that individual home buyers often react more quickly to a changing financial environment, compared to larger builders.

He expects overall starts to recover in the latter half of this year, and even more into 2025.

There are signs the Bank of Canada may begin loosening up its policy, but Burggraaf said that could take more than a year to work its way through the system and spur more multi-unit construction.

The provincial government has set a target of 151,000 new homes for Ottawa by 2031, though the city is assessed on its progress year by year and could lose funding if it falls short.

Burggraaf said meeting those targets could be a "reach" over the next couple years, though he feels more confident that Ottawa will get there over the long term.

"I think the overall trend is positive," he said.

https://www.cbc.ca/news/canada/ottawa/ho...ak-in-province-worse-in-ottawa-1.7210172

[rocketphish]

Vacant unit tax brings in way more than forecast, but still irks some homeowners
New tax earned the city $11.5M last year, but some say it's not serving its stated purpose

Arthur White-Crummey · CBC News
Posted: Jun 07, 2024 4:00 AM EDT | Last Updated: 10 hours ago

Ottawa's vacant unit tax (VUT) is raking in millions more than expected, leaving some residents and one city councillor wondering whether it's a fix for the housing crisis or simply a cash grab.

The tax charges one per cent of the assessed value of homes left unoccupied for six months or more within one year. It's meant to push property owners to either put those units up for sale or rent them to address the city's housing shortage.

When council approved the tax two years ago, it was expected to bring in about $6.6 million per year. But city staff now say last year's revenue haul came to $11.5 million.

Orléans East-Cumberland Coun. Matt Luloff, a longstanding critic of the tax, asked staff for that information through a formal inquiry. He didn't like what he heard.

"I don't think that this program is truly doing what it was meant to do, which is to free up rental units — not to become a new income source for the City of Ottawa," said Luloff.

Luloff said he hasn't seen a clear measure of whether the tax is actually getting vacant homes back on the market. He also asked staff for more detailed information about how the revenue is being spent.

Staff responded that all of the money goes to fund affordable housing initiatives, minus about $2.3 million spent to administer the program, though they promised to get Luloff additional details.

Joseph Muhuni, the city's deputy treasurer for revenue, told CBC that VUT revenues are higher because there are almost twice as many vacant properties than initially estimated.

"I think the problem's a little bit worse than we thought it was going to be," he said.

Muhuni said he expects revenues will decrease in the years ahead, and called that "a measure of success." He said 1,700 units vacant in 2022 were occupied the following year, according to preliminary numbers, though roughly the same number of units became newly vacant.

Muhuni said the initial data from this year's tax cycle, which involves declarations for the 2023 occupancy year, suggests more homeowners are claiming exemptions, which cover anything from death to major renovations.

That could mean fewer appeals. In last year's cycle, which covered the 2022 occupancy year, 6,104 units were initially deemed vacant. More than half — 3,206 units — were the subject of an appeal. The overwhelming majority of those, for 2,736 units, were successful.

"A little bit of that was growing pains," said Muhuni. "I think this year we're in a much better position, and I want to say, I think subsequent years will even be better."

But Luloff thinks the tax is still targeting the wrong people. He said his office has been "inundated" with complaints from residents frustrated with the way the tax is administered.

He mentioned one woman whose home was left vacant while she cared for her ailing father.

"There are some contextual circumstances that require far more discretion in the administration of this program," said Luloff.

Kara Brandwood reached out to CBC to call for precisely that kind of discretion. Brandwood lives in B.C. but owns two rental properties in Ottawa, and said she didn't declare they were occupied due to what she called "a perfect storm" of circumstances.

She said she was unaware of the new tax and didn't receive any notices for the 2022 tax year, partly due to being out of the country and partly due to the cessation of Canada Post's ePost service. The city withdrew $5,290 automatically through a pre-authorized property tax payment, she explained.

When Brandwood finally noticed the charge on her tax bill this year, she learned it was too late to appeal.

"I wasn't trying to go under the radar or do anything I wasn't supposed to do," she said. "I legitimately didn't hear about the program."

She called it "ludicrous" that she's still on the hook for $5,290, despite the fact that both of her properties were occupied by renters during the entire period.

"They said the matter is closed," Brandwood said of the city. "There will be no further discussion on their part with regard to this matter at all. So, too bad, so sad. You're out of luck."

In her view, the three-month appeal window is too brief and the process unduly complicated.

"The administrative burden of this kind of action makes me question whether I want to be a landlord anymore," she added.

At a meeting of council's finance and corporate services committee this week, Orléans South-Navan Coun. Catherine Kitts directed staff to fill a "gap" in the appeals process and explore amending the program to "allow property owners to declare their property status after the established appeal deadlines have passed."

Muhuni called the appeal window "reasonable," but said staff are open to looking at changes in line with Kitts's direction.

"We have seen some people, of course, that have been caught up in really, I would say, weird circumstances," he said. "And I think there's always opportunities for improvement."

In its response to Luloff, the city noted that the overwhelming majority of homeowners did declare by the deadline this year. Just 1,962 of 328,000 eligible properties missed the April 30, 2024, date for the 2023 tax year.

But Luloff called Brandwood's case senseless. If the goal of the program is getting people into homes, he said, that's precisely what she's doing.

"She's hit with this punitive fine when she is meeting the spirit of the policy," said Luloff. "I think that that's entirely unfair and something that needs to be remedied."

https://www.cbc.ca/news/canada/ottawa/va...but-still-irks-some-homeowners-1.7226551

[Uhuniau]

Let them be "irked".

[Kitchissippi]

I think it irks homeowners because of the inconvenience of everyone having to file a declaration every year. The requirement basically tasks the majority just to catch a minority. It’s not even foolproof because anyone could just file the declaration online. The city needs to figure out a better way to determine occupancy.

[kwoldtimer]

"(L)eaving some residents and one city councillor wondering whether it's a fix for the housing crisis or simply a cash grab,"

Or perhaps the rate has been set too low to have the desired effect.

[rocketphish]

Whatever you think of the VUT, this aspect of it just seems wrong. It should be pinned on the owner, not the property.

Homebuyers getting 'nasty shock' from city's new vacant unit tax
'It's not my mistake. It's the previous owner's mistake, but all of a sudden I'm getting the bill'

Arthur White-Crummey · CBC News
Posted: Jun 08, 2024 4:00 AM EDT | Last Updated: 10 hours ago

Some Ottawa homebuyers are getting sticker shock months after their purchase, as vacant unit tax (VUT) charges from the previous owner add thousands of dollars to their property tax bills.

Nick Gagnon got a $4,800 surprise on his bill after buying a Nepean home in an estate sale. It closed in February, and now he's dealing with the fallout of the seller's mistake.

"We got a nasty shock of, hey, here's this vacant unit tax we weren't expecting to pay," Gagnon said.

Rolando Pirker said he opened his property tax bill on Monday and was surprised to see it was double the amount he'd guessed. He noticed a $3,670 vacant unit tax charge on a home he bought this March.

Pirker suspects the previous owner made a mistake filling out the declaration to the city to confirm whether the property was occupied during the previous year. Whatever the reason, he doesn't see why any of that should be his problem now.

"It's not my mistake. It's the previous owner's mistake, but all of a sudden I'm getting the bill," Pirker said.

But the city says it is his problem. On a webpage explaining the program, it says buyers should do their due diligence to ensure there are no outstanding taxes owing on their new property, since they become the buyer's responsibility after sale.

Joseph Muhuni, the city's deputy treasurer, said the VUT works like property taxes: It's tied to the home, not the owner.

When the city rolled out the tax, Muhuni explained, it sent out letters to law firms that handled home sales to make sure they understood.

"We always have advised the law firms to make sure that there's full disclosure and due diligence in either case — whether it's been declared vacant or occupied — making sure that the buyer understands what the declaration or occupancy status was for that property in the previous year," he said.

Here's where it can get complicated: Generally, the VUT declaration is due in mid-March with an extended deadline of April 30. If a sale closes after Jan. 1, but before the extended deadline, the seller is supposed to submit the declaration.

With the VUT program still so new, real estate lawyer Shannon Hogan of Mann Lawyers said that step "might go unnoticed" in some cases.

"If somebody purchases the property early enough in 2024 — so before the vacant unit tax declaration for the previous year is due — the sellers may not have filed that declaration in 2024 for the previous calendar year," she said.

"Then, when the deadline does pass and the tax gets levied, that's when the purchaser has a nasty shock."

Lawyers generally look at property tax bills and ensure they're paid, Hogan said, but that might not be enough to catch the VUT charge. She said the buyer's lawyer should request tax certificates or some other explicit confirmation, so nothing falls through the cracks.

Hogan said there's another way to protect buyers that's increasingly finding favour as realtors begin accounting for the VUT in the sales agreement.

That can include a sworn statement confirming that the seller has submitted a declaration, and even an indemnification stating that the seller, not the buyer, is on the hook if anything goes wrong.

"We don't see that in every agreement of purchase and sale, but that's ... the ideal scenario," Hogan said.

Gagnon said he now has some clarity on what landed him with that $4,800 line on his property tax bill. The seller claimed a VUT exemption available after a death, but it turns out they didn't actually qualify because the home had been empty too long.

"When we submitted the documents to our lawyers on closing, the lawyers had no way of knowing that the home was vacant for more than two years. It was actually vacant for five years," he said.

He said his lawyer says they'll take care of the problem, and it might undergo an appeal. It could also be covered by title insurance, but Gagnon doesn't think that's a good solution.

"You don't want to have title insurance paying out these vacant unit taxes, because that's just going to increase everyone else's title insurance," he said.

Even if he gets off the hook, dealing with the VUT system hasn't been pleasant for Gagnon, especially amid all the stress of moving into a new home.

"It's a lot of money and a big shock," he said.

After reaching out to his lawyer, Pirker confirmed that the $3,670 charge on his bill stemmed from a mistake: It looks like the previous owner selected the wrong year for the start of a tenancy in 2023, he explained.

He said his lawyer has now contacted the seller's lawyer, who contacted the city, which, he's been told, has acknowledged the error and corrected it.

Pirker called the whole episode confusing. He doesn't plan to pay the VUT on his bill right now, but isn't sure whether it will really go away without a formal appeal.

"You just feel uneasy," he said. "Are they going to put a lien on my house?"

https://www.cbc.ca/news/canada/ottawa/ho...rom-city-s-new-vacant-unit-tax-1.7227977

[rocketphish]

Empty-nesters, retirees drive condo sales in Ottawa, while first-time buyers stay on sidelines

Mia Jensen, OBJ
October 9, 2024

A new report from Re/Max Canada found that the Ottawa condo market stalled in the first eight months of 2024, with affordability the top concern on the minds of potential buyers.

However, activity is expected to pick up next spring, according to the report, which examined condominium activity from January to August of this year.

“Downsizing empty nesters, retirees and first-time homebuyers fuelled steady demand in the Ottawa condo market in 2024,” Re/Max said about the findings in the report, which was released Wednesday. “But the number of condominium apartments and walk-ups sold between January and August fell short of year-ago levels.”

In Ottawa, 1,407 condos changed hands in the first eight months of 2024, a drop of 0.9 per cent compared to the previous year. Prices, meanwhile, saw an increase of 2.3 per cent compared to the previous year, with an average of $447,042.

Re/Max said buyers remain wary.

“Affordability remains a major concern in the Ottawa housing market, despite changes to monetary policy in recent months,” it said. “First-time buyers find themselves locked out of the freehold market, given high interest rates and stringent lending policies.”

Hesitation from buyers has led inventory levels to increase year-over-year, with more than 636 active listings in August, about 44.5 per cent more than in 2023, Re/Max said.

In the luxury market, inventory levels are tight, with fewer options at the $850,000 or above price point.

First-time buyers, the report added, are leaning toward condos priced around $500,000, with low monthly maintenance fees and parking.

Centretown and Dows Lake are popular locations. While less expensive units priced at around $350,000 are available in older buildings, monthly condo fees tend to be higher. Meanwhile, suburban condos in Kanata, Barrhaven and Orleans have been selling for $375,000 to $400,000, the report said.

Re/Max said the majority of activity in the local condo market is coming from empty nesters and retirees looking to downsize. Walkable and “community-forward” neighbourhoods such as Westboro, the Golden Triangle, Centretown and areas of gentrification such as the Glebe, Lansdowne and Old Ottawa East were the most desirable for those buyers, who are looking for proximity to restaurants, cafes, shops and walking paths.

Despite the stall in sales in 2024, Re/Max said activity is expected to pick up in the coming months.

“As consumer confidence grows with each interest rate cut, more and more buyers are expected to return to the Ottawa condo market,” the report said. “Fourth-quarter sales are expected to be comparable to year-ago levels, but the outlook for spring of 2025 appears to be bright. Pent-up demand is building and those first into the market will reap the rewards.”

Nationally, condo inventory is on the rise in most major markets as more sellers list their properties in anticipation of growing demand from buyers, the report said.

The report found B.C.’s Fraser Valley led year-over-year inventory growth at 58.7 per cent, followed by the Greater Toronto Area at 52.8 per cent and Calgary at 52.4 per cent.

Those regions were followed by Ottawa, with 44.5 per cent inventory growth from the same period last year, Edmonton at 17.7 per cent, Halifax at 8.1 per cent and Vancouver at 7.3 per cent.

The real estate firm attributed the influx of supply to sellers’ expectations that demand will pick up in the fourth quarter of this year and early 2025.

“High interest rates and stringent lending policies pummelled first-time buyers in recent years, preventing many from reaching their home-ownership goal, despite having to pay record high rental costs that mirrored mortgage payments,” said Re/Max Canada president Christopher Alexander in a news release.

“The current lull is the calm before the storm. Come spring of 2025, pent-up demand is expected to fuel stronger market activity, particularly at entry-level price points, as both first-time buyers and investors once again vie for affordable condominium product.”

The GTA was the only region where average condo prices declined year-over-year, with a 1.9 per cent drop to $732,648 for the period examined.

Calgary led the way for average price growth, posting a 15-per-cent gain to reach $347,203. Meanwhile, the Greater Vancouver Region was the most expensive market for condos with an average price of $823,550, up 1.9 per cent from 2023.

Edmonton was the cheapest, with an average price of $200,951, however, that was the second biggest gain of any market, up four per cent year-over-year.

For the first eight months of the year, Edmonton posted a 36.7-per-cent increase in sales compared with the same period in 2023, even as most regions saw sales decline from last year.

The GTA, Greater Vancouver and Fraser Valley each recorded sales declines of more than eight per cent.

“The current uptick in inventory levels is drawing more traffic to listings, yet buyers remain somewhat skittish across the country,” the report said.

“The first two Bank of Canada interest rate cuts did little to entice prospective homebuyers to engage in the market, given the degree of rate increases that took place. However, with further rate reductions expected and policy adjustments to address affordability and ease entry into the market, activity will likely start to climb, particularly among end users.”

The report warned that Toronto, where oversupply and lagging demand have plagued the condo market, may be the last market to emerge from sluggish conditions.

It said inventory levels have continued to climb as available resale units were joined by an influx of new completions, noting 20,000 new condo units are planned for the GTA in 2025, followed by 30,000 in 2026 and 40,000 in 2027.

“With a six-month supply of condominiums currently available for sale, the GTA market is heading into clear buyers’ territory,” the report said.

“With values at or near bottom and Bank of Canada overnight rates trending lower, the fall market may represent the perfect storm for first-time buyers … As absorption rates increase, the current oversupply will be diminished and demand will take flight, placing upward pressure on average prices once again.”

With files from The Canadian Press

https://obj.ca/empty-nesters-retirees-condo-sales-in-ottawa/

[BlueJay]

Originally Posted by AuxTown

That may be the case, but as folks interested in a growing and prosperous Ottawa we should not get too excited. The Cons are gonna cut like 20% from the public service. I wonder if we will see a mini local recession? I don't really have any skin in the game....other than being a homeowner in Ottawa but I know a lot of people are nervous not just about losing their jobs but about taking on the work of those that are cut.Cool update video, nonetheless. Some striking scenes along that little LRT line.

OK, everyone chime in on their anticipated first day of Trillium service....

I'm taking December 10th

Cutting 20% of the public service from a 40% in public service increase since 2016 will not equal a mini recession. A change in Federal Govt. will see a significant increase in new residential starts including two major 'landmark' projects in Ottawa that have been on the back burner the last few years. I would love to expand on my comment if someone here would propose an SSP meet!

My comment is not partisan driven. It is simply the facts that have come to light after many many meeting with officials from all three levels of government.

[urbanforest]

Can you expand on why a change in govt would trigger an increase in housing starts, and what two significant projects?

[zzptichka]

Shutting down immigration and sending back all international students will surely boost housing starts.

[AuxTown]

Originally Posted by BlueJay

Cutting 20% of the public service from a 40% in public service increase since 2016 will not equal a mini recession. A change in Federal Govt. will see a significant increase in new residential starts including two major 'landmark' projects in Ottawa that have been on the back burner the last few years. I would love to expand on my comment if someone here would propose an SSP meet!

My comment is not partisan driven. It is simply the facts that have come to light after many many meeting with officials from all three levels of government.

I'm not debating that the federal public service is bloated (it is), but bloated or not those 40%ers purchase/rent housing, many of them in Ottawa, and without a job they will leave. I'm pretty sure it's just math. We are lucky that Ottawa has become a bit more diversified in recent decades (high tech, biotech) but we are still a one horse town when compared to most large cities. Calgary might be the only city even close to us in terms of depending on a single industry to prop up their economy (O&G) and it sounds like they are in big trouble once the Cheeto takes power again in January.

We might see Lebreton finally coming to fruition so that will be amazing, but I even worry about it's sustainability if much of their plans revolves around building apartments/condos in the vicinity on discounted/subsidized land.

[kmcamp]

Originally Posted by AuxTown

I'm not debating that the federal public service is bloated (it is), but bloated or not those 40%ers purchase/rent housing, many of them in Ottawa, and without a job they will leave. I'm pretty sure it's just math. We are lucky that Ottawa has become a bit more diversified in recent decades (high tech, biotech) but we are still a one horse town when compared to most large cities. Calgary might be the only city even close to us in terms of depending on a single industry to prop up their economy (O&G) and it sounds like they are in big trouble once the Cheeto takes power again in January.

We might see Lebreton finally coming to fruition so that will be amazing, but I even worry about it's sustainability if much of their plans revolves around building apartments/condos in the vicinity on discounted/subsidized land.

I remember the big cuts in the 90s, definitely wasn't a great era for Ottawa. I also agree that the government is currently bloated, but there's no positive for Ottawa when the cuts inevitably happen. The one thing that's different though then the 90s is those jobs aren't as concentrated here and are more spread out across the country, so maybe it won't be so bad.

However, since we're talking Line 2 here, I don't think whatever happens will have a big impact on that lines ridership. Government workers have always tended to be concentrated in Orleans, as it was cheaper and easier to get downtown.

[wingman]

Originally Posted by kmcamp

I remember the big cuts in the 90s, definitely wasn't a great era for Ottawa. I also agree that the government is currently bloated, but there's no positive for Ottawa when the cuts inevitably happen. The one thing that's different though then the 90s is those jobs aren't as concentrated here and are more spread out across the country, so maybe it won't be so bad.

However, since we're talking Line 2 here, I don't think whatever happens will have a big impact on that lines ridership. Government workers have always tended to be concentrated in Orleans, as it was cheaper and easier to get downtown.

The only other consideration I can think of regarding the reduction of the public service would be that a lot of that is expected to come via retirements. The boomers are finally at that stage where many are ready to go, especially with the RTO mandates of late. Lot's of them are holding out for the Cons election win next year to snag an early no-penalty pension. The reason I bring this up, is because many of those are in the NCR, and will remain retired in the NCR. So I do wonder how many will move away? Obviously those seeking new employment are more likely to.

[AuxTown]

Originally Posted by wingman

The only other consideration I can think of regarding the reduction of the public service would be that a lot of that is expected to come via retirements. The boomers are finally at that stage where many are ready to go, especially with the RTO mandates of late. Lot's of them are holding out for the Cons election win next year to snag an early no-penalty pension. The reason I bring this up, is because many of those are in the NCR, and will remain retired in the NCR. So I do wonder how many will move away? Obviously those seeking new employment are more likely to.

That is a good point. There will for sure be a large proportion of cuts through attrition. I can only gauge on people I know and patients that I see and I know a bunch of people who were hired in lower-level public service jobs since the pandemic, most of them quite underqualified IMO, who are young and likely the first on the chopping block.

[YOWetal]

Originally Posted by kmcamp

I remember the big cuts in the 90s, definitely wasn't a great era for Ottawa. I also agree that the government is currently bloated, but there's no positive for Ottawa when the cuts inevitably happen. The one thing that's different though then the 90s is those jobs aren't as concentrated here and are more spread out across the country, so maybe it won't be so bad.

However, since we're talking Line 2 here, I don't think whatever happens will have a big impact on that lines ridership. Government workers have always tended to be concentrated in Orleans, as it was cheaper and easier to get downtown.

Even the small 2011 cuts were bad for transit and housing. This is likely to dwarf even 1990s cuts.

Civil Servants live all over the city and their Realtors, Dental hygienists etc will also be impacted. That's how recessions work. This is an oil crash in Calgary. The job cuts might be 30k 40k or even 50k with multiplier effect that is even worse. Impacting a lot of Ottawa households.

[BlueJay]

Originally Posted by zzptichka

Shutting down immigration and sending back all international students will surely boost housing starts.

That's an odd statement. No one is proposing to shut down Immigration
besides Max Bernie who has zero chance of becoming a politician again. The current government is doing the right thing by reducing International students.

That being said, we do need to revisit the number of newcomers we are projecting to ensure a right balance of supply and demand.