First-quarter housing starts up over 2007 in city
TheStarPhoenix.com
Published: Tuesday, April 08, 2008
SASKATOON - Construction has started on nearly 600 housing units in Saskatoon in the first three months of 2008 and the pace is expected to continue through the spring, according to a new report released Tuesday.
The Canada Mortgage and Housing Corporation's (CMHC) residential construction survey for March shows that total housing starts for the year are 85 per cent higher than those recorded in the first three months of 2007, up to 590 units this year from 319 last year. Paul Caton, CMHC's market analyst for Saskatchewan, said the corporation isn't cutting back its housing forecast for Saskatoon until 2009. Most of the growth this year will come in the first two quarters, he added.
"The momentum continues," Caton said about the housing starts.
"We're seeing a 37-per-cent increase in housing starts in Saskatchewan's urban areas. On the single-detached side, we're seeing a 27-per-cent increase in the first quarter in housing starts and on the multi-family side, there's more than a 53-per-cent increase in the number of housing starts."
The last time Saskatoon recorded March numbers as high as last month's single-detached housing starts, at 128 units, was in 1983, according to the report. Multi-family housing starts, which include condominiums and apartments, are also up over last year to 86 starts last month from four in March 2007.
"The multi's are very strong, especially in Saskatoon which has always been sort of the condominium capital of the province. As a matter of fact we've got 900 to 1,000 multi-family units now under construction in Saskatoon, so we're forecasting that those types of housing starts should start to slow down mid-year or toward the end of the year," he explained.
With more than 1,000 single-family homes under construction in and around the city as well, Caton believes more rental units and resale homes will be available once homeowners move into the new properties. Most of the multi-family construction is being done on condos, he said, adding the few apartments included in the count are meant for families with limited income.
"Rents are increasing on the rental housing side such as they've never increased before, we have extremely low vacancies, there's a very low inventory on the resale side . . . and that pushed people into the new housing side whereas they usually would have stayed in the resale or residential housing," Caton said. "If we get those other two sectors loosened up, that is the rental housing and resale housing, that will probably cause people to drop back from new housing and get into the existing stuff again."
Saskatchewan cities with populations of more than 10,000 all saw an increase in housing starts, except for Estevan and Lloydminster, which dropped by 20 per cent and 85 per cent, respectively. Regina's total housing starts at the end of March increased 16.5 per cent from the first quarter of 2007, to 127 from 109.
Nationally, housing starts are down slightly from February, to 254,700 units in March from 255,600.
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Council backs apartment incentive plan
Lori Coolican, The StarPhoenix
Published: Tuesday, April 08, 2008
City council agreed in principle Monday to a $6-million rebate program to lure private developers into building 1,000 new apartments within the next two years.
"I wish it wasn't in principle. I wish it was the real McCoy tonight," said Coun. Maurice Neault, who congratulated civic staff on the proposal.
The exact details will need some working out, but the plan is "absolutely a step in the right direction," said Alan Thomarat of the Saskatoon and Region Homebuilders Association.
"I think we should meet as soon as possible to work on the details," he told council.
The proposed program would offer a cash rebate of up to $10,000 per unit to compensate investors for their land costs -- about half the current market value -- if they build multiple-unit apartment blocks.
The rebates would be contingent on construction being finished within 18 months, the suites being kept as rentals for at least 15 years and 20 per cent of them being rented at "entry-level" prices, which are defined by the city as $1,100 to $1,500 per month.
The timeline may be too short, and builders have some issues with the "entry-level" units, but it's a move in the right direction, Thomarat said.
Some councillors expressed concern about the short-term situation for renters, however.
"This only makes sense if we don't keep allowing buildings to convert to condominiums," said Coun. Charlie Clark, noting some 1,600 local apartments have been converted or begun the conversion process over the last year, shrinking the number of rental units in the city.
"If we keep converting units, I don't see why we'd spend (public) money to build more," Clark said.
Not long after agreeing to talk further with builders about the rebate program, council was confronted with applications from five property investors to convert nine more local apartment blocks into condominiums -- a total of 183 units.
Student Kimberly Erickson moved into one of them -- in a building on Arlington Avenue -- after her last place was converted into a condo. In late October, she and her neighbours were notified a numbered company from Alberta intends to convert the Arlington building.
"So where is a person supposed to go? If I move, what are my chances that the next building won't be converted?" Erickson wrote in an e-mail attached to city council's agenda.
"Not everyone can afford to purchase a home, especially at the prices these days. Thousands of students who are not from Saskatoon are in need of affordable places to live; and not everyone has wealthy parents who can buy a condo for them while they attend school."
More than a dozen residents of five buildings in the 2700 and 2900 blocks of Seventh Street East also wrote letters pleading with council to reject an Alberta-based investor's application to convert those buildings.
A man living in one of those buildings raised concerns about its state of repair -- including a serious ant infestation, mold and leaky windows that leave puddles on the floor.
"This is particularly worrying in view of the landlords' intent to sell the condominiums to existing tenants for $180,000 in their current condition," he wrote.
"(W)hilst I accept that conversion to condominiums is eventually inevitable in the current property market . . . it is my opinion that a serious investigation into health and other hazards of the building be made before any licence for conversion is granted, if ever. If, on the other hand, the landlords wish to continue to rent the apartments out to loyal tenants like ourselves, they will have our gratitude even given these problems."
The investor, Danny Perreault, said he intends to market the condos to other investors who will likely rent them out again.
Only Clark voted against the nine building conversions Monday. Two others, councillors Pat Lorje and Bob Pringle, were absent.
In an effort to ensure developers comply with the city's conversion policy, council voted to approve each of the applications only on condition the buildings' owners offer enforceable leases to existing tenants for two years at rental rates comparable to similar apartments in their area.
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City buys land for new neighbourhood
The StarPhoenix
Published: Tuesday, April 08, 2008
The City of Saskatoon's land bank is about to become the new owner of a 160-acre chunk of farmland in the city's northeast.
City council voted Monday night to approve the $3.99-million purchase for future neighbourhood development from the current owner of the land, Anderson Ventures Inc.
Located north of Agra Road and about three kilometres east of Central Avenue, the land is expected to be sold after the remaining lots in the nearby new suburb of Willowgrove have been absorbed, which will probably happen during the next two years, according to a report from civic staff.
"Preparation of the concept plan for this new neighbourhood is well underway and is scheduled to be submitted to city council for approval later in 2008," staff note.
"Once the concept plan has been approved, servicing work will be undertaken in order to provide new lots for sale starting in the fall of 2009."
The new neighbourhood, which has not yet been named, is expected to take between 10 and 15 years to complete.
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City to guarantee revitalization project
Lori Coolican, The StarPhoenix
Published: Tuesday, April 08, 2008
Profit-driven builders had no interest in buying two parcels of residential land to revitalize an inner-city area near St. Mary School, so the city is offering to pay them to do the work on its behalf instead.
A formal call for expressions of interest (EOI) in developing homes on the newly cleared land this winter resulted in four responses -- and all four came from non-profit groups who would rely entirely on government funding to proceed.
Private homebuilders in the city have said they did not respond to the EOI because "they are concerned about the potential risk of a new housing venture in a revitalization scheme when there are more attractive opportunities elsewhere," according to a report received by city council.
Civic officials are concerned the non-profit groups would not be able to proceed with construction on their own this year, leaving the land empty, the report states.
"There is also a desire to offer a certain amount of units as homeownership opportunities to avoid the perception that the revitalization project is only for rental units and social housing. . . . It is important that development commence within this area in 2008 to maintain confidence in the revitalization project."
Without debate, city council voted unanimously Monday to issue a request for proposals to local homebuilders to construct about 42 housing units on two parcels of newly cleared residential land near St. Mary School -- with all the risk born by the city, instead of the builders.
The builders would have to construct homes that conform to the concept plan for the site and offer up to half of the units for sale to the four non-profit groups who answered the city's earlier call for expressions of interest, on a right-of-first refusal basis, according to the report.
If none of those groups are interested in buying the completed units, they will be "offered to the marketplace," along with the other half of the units, by the homebuilders.
Any remaining units after that would be offered to Saskatchewan Housing Corporation, civic officials recommend.
If any units remain unsold in the end, they will be purchased by the city and rented out as "entry-level leases" to low- and moderate-income households.
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