pipeline

Five hottest British Columbia news stories of 2018

Western Investor's most-read stories, from dual-agency regulation to new and expanded residential real estate taxes

During a year of major real estate policy and regulation change, it comes as no surprise that WesternInvestor.com’s most-viewed B.C. stories gave readers the insight into these new developments, including B.C’s foreign buyer tax, restrictions on assignment sales to prevent ‘shadow flipping’ and ‘ double-ending’. Readers also frequented the sight to get the lowdown on up-and-coming investment destinations.

Here is our annual countdown of our five most-read British Columbia stories published in 2018.

5. Mill town of Powell River becomes low-cost investment destination

Our first story to garner the most views this year focuses on the economic growth of Vancouver Island town Powell River, a los-cost alternative to the mainland with a 80.3 per cent increase in housing sales year-over-year. 

4. Dual agency rules will disrupt housing market, real estate agents claim

Changes to the B.C. Real Estate Services Act that came into effect June 15, 2018 prohibited "double ending" – representing both a buyer and a seller in a real estate transaction. In our story, real estate professionals worried it could slowdown sales – and as the year progressed, they may have had a point. 

3. China's largest online retailer to start selling Canadian real estate

This quick-hit story on Chinese real estate portal Juwai.com and retail site JD.com teaming up to offer Canadian real estate to Asian consumers garnered the third-most views this year, showing us that readers are still drawn to stories on foreign investment in Vancouver property. 

2. Higher-priced house markets nailed by tax hike

Our second-most read story of the year focused on the first effects on the housing market following the B.C. Budget 2018 housing measures announcement. Pricey markets like Vancouver’s west side were the first to fall, seeing prices down 70 per cent in April 2018 versus April 2016. 

1. Canada Revenue Agency recruited to help fight mortgage fraud

Our most-read story of the year covered the CRA’s recruitment to combating mortgage fraud together with the Canadian Mortgage and Housing Corporation, by allowing lender to have access to an applicant’s tax data. Together with numerous Bank of Canada interest rates this year, it’s no surprise that readers we’re reading and watching to see how new regulations would affect mortgage eligibility in a changing market. 

After a relatively sedate 2018, Toronto is heating up again

After exhibiting relatively modest performance for most of 2018 with the advent of stricter mortgage qualification rules, Toronto is seeing a resurgence in market competition once again.

The latest numbers from the city’s real estate professionals’ association indicated that the total number of active for-sale listings in the GTA saw a 9.8% year-over-year decrease in November, down to 16,420 units.

During the same time frame, the volume of new for-sale listings in the region shrank by 26.1%.

“New listings were actually down more than sales on a year-over-year basis in November,” TREB President Garry Bhaura said, as quoted by Bloomberg.

Read more: Toronto apartment inventory having trouble catching up with demand

“This suggests that, in many neighbourhoods, competition between buyers may have increased. Relatively tight market conditions over the past few months have provided the foundation for renewed price growth,” Bhaura added.

Average home sales price last month was $788,345, growing by 3.5% from the same time last year.

Meanwhile, total sales in November stood at at 6,251 completed deals, representing a 14.5% annual decline.

TREB stressed, however, that any year-over-year comparison should take into account that November 2017’s performance is “distorted” due to a large number of buyers rushing to beat the implementation of B-20 in January 2018.

www.canadianrealestatemagazine.ca
by Ephraim Vecina07 Dec 2018

Mortgage stress test could become election issue

The Conservative Party of Canada plans to make the mortgage stress test a hot button issue in time for next year’s election, but explaining such a convoluted issue to Canadians could pose a challenge.

The party’s Deputy Shadow Minister for Finance tabled two motions this year to study the impact of the stress test, known as B-20, but they were both rejected by the Liberals. Nevertheless, MP Tom Kmiec has vowed to put the mortgage stress test on the agenda in time for the Oct. 2019 federal election.

“It will be an election issue, absolutely,” said Kmiec. “I’m willing to use procedural tools to get this study done. I’m not necessarily saying to get rid of B-20 completely; I’m saying take a look at the data and then make a decision on it. I’m asking the Liberals to provide any internal documents they have showing why the mortgage rules were introduced in the first place.”

Kmiec has started a website to pressure the Liberals into studying B-20’s effects. He claims that he was initially told B-20 wouldn’t be examined in the absence of more data, however, much has since come to light about Canadians being shut out of the housing market.

Kmiec is dogged, to be sure. He participated in the electoral reform committee’s filibuster.

“If it comes down to it, I’m happy to use up every two-hour time limit on every single committee until we agree to do a mortgage study,” said Kmiec. “I’m not asking for the moon, either. All I want are a few meetings in Ottawa where we can invite people with data who can then tell us what’s happening with the market.”

But communicating the message will doubtless be challenging for the Conservatives. Ron Butler of Butler Mortgage can attest to how difficult buying homes has become this year, but too few Canadians have born that brunt for the impact to truly be understood.

However, given that mortgage renewals are subject to the same stringent B-20 qualification rules, Butler believes it is still possible to make Canadians understand how detrimental the stress test is.

“It won’t be hot button, but if it’s messaged right, it could be,” he said. “If it’s presented properly as a group of themes about the incompetence, in terms of the ability to handle the file—why has Mexico settled NAFTA already and Canada hasn’t? Why did we buy a pipeline that got shut down? It’s a good thing to add to the general list of incompetence. On its own, it isn’t a hot button issue, but if you want to weave it into a tapestry of every day, practical fiscal management, it could work.”

 

by Neil Sharma01 Oct 2018, www.canadianrealestatemagazine.ca

Zoning could be key to funding downtown relief line

Toronto’s downtown relief subway line—should the political will needed to build it ever materialize—could partly fund itself, to say nothing of the skyrocketing valuations that will result.

According to Andy Manahan, executive director of the Residential and Civil Construction Alliance of Ontario, the municipal government can use zoning as a bargaining chip with developers to pay for the proposed network expansion by negotiating additional storeys.

 

“If a building is only zoned for five storeys but the developer is given 20 storeys, that extra 15 storeys is worth a lot of money and developers would be willing to pay it,”said Manahan. “If we build a relief line, we have to place more density at the station so that there’s more land value capture. If you do that link between land use and transit, you can do some creative financing in the long-run as well, and get some more developers on board.”

Many existing TTC subway stations were created as architectural monuments rather than into the sides of buildings, which is what would adequately succour density.  And if the mere rumour of below-grade infrastructure is enough to cause property values to rise, imagine what a unit 25 storeys above a subway platform would be worth.

“Typically, once an announcement is made about where the line will go, property values do increase, so the trick is how we ensure we can capture some of that increase in value,” continued Manahan.

However, more is at stake than optimizing real estate values. Toronto’s current subway network is overcapacity and its platforms dangerously brim with people. Given how many skyscrapers will continue sprouting downtown, not to mention the already low office vacancy rate, Manahan warns that the network’s capacity troubles are worsening.

“We have a lot of growth in the downtown core, and it’s not just residential,” he said. “There’s about 5.7mln square feet that will be added to the downtown office segment by 2020.”

Davelle Morrison of Bosley Real Estate echoed Manahan: “Right now, without further additional building of office space downtown, we already know we need the relief line. If you add more people working downtown and more people living downtown, because immigration numbers are high and more and more people are moving to Toronto in particular, it’s a no-brainer to me about why you would need the downtown relief line. It’s already needed, but 10, 15 years from now, it’s going to be needed even more.”

The RCCAO has been an outspoken proponent of the downtown relief line, taking out full-page newspaper ads and even launching a Twitter campaign called #GimmeRelief.

The earliest the downtown relief line could complete is 2031, however, there’s no official plan to build it. In fact, it’s as much of a pipe dream today as it was a decade ago—and making matters more frustrating for commuters, the Scarborough subway line has been given priority.

Backwards thinking, says Manahan, because sequencing is important and dictates building the network outward rather than inward, where support infrastructure is presently non-existent.

But he takes solace in Ontario’s political parties acknowledgment that the downtown relief line needs to be built.

“Over the last 50 years, the relief line is talked about occasionally and never gets built. It’s an important project and recognized by all four provincial parties. After June 7, no matter which party is in power, they will have to continue.”

by Neil Sharma30 May 2018 | Canadian RealEstate Wealth

Unlikely Canadian city attracting foreign buyers

Ottawa is experiencing a rental shortage, and savvy foreign investors are swooping in.

“There’s a shortage of inventory in the rental market here, so there’s a need for rental properties,” said Chris Lacharity, a sales representative with Marilyn Wilson Dream Properties, which deals in the luxury market. “An astute buyer knows that. There are a lot of foreign buyers who buy for personal use, but there’s a lot of investment, too.”

 

The nation’s capital is situated between Toronto and Montreal—two cities with significant foreign buyer activity—so the presence of non-resident investors shouldn’t come as much of a surprise.

“Ottawa is growing faster than it ever has, but there’s still growth potential,” said Lacharity. “It has a ways to go, in terms of growth, but it’s also a capital city, a government city. It has rivers and lakes, and it’s aesthetically pleasing. If you have a family, it’s safe and hasn’t experienced all the issues that come with large metropolises. It’s also close to Montreal and Toronto.”

Montreal has arguably the hottest real estate market in Canada right now. Government initiatives brought in to cool skyrocketing housing prices in Vancouver and Toronto are believed to be responsible for that. But Ottawa is another city in the midst of a renaissance. In addition to an LRT project, it has a thriving tech sector, robust student population, and well-paying government jobs.

It is also very stable—and given investors’ distaste for volatility, that’s perfect.

“Real estate doesn’t just shoot up, it conservatively rises here 3-5% on average,” said Lacharity, adding foreign buyers park money in the city’s real estate. “It’s a pretty safe bet for that.”

Bernadette Deschenes of Your Choice Realty notes overheating in Toronto and Vancouver are catalysts for foreign buyer activity in Canada’s capital city. But the city’s two universities have also impelled foreign buyers into action.

“They buy more student residences, like condos or townhomes,” said Deschenes. “Most of our foreign buyers are buying for their children who are attending university. We have a huge student population in this city. There’s a fair bit of older brownstone that’s near Ottawa U in the Sandy Hill region.”

by Neil Sharma09 May 2018 | www.canadianrealestatemagazine.ca

Alberta-B.C. pipeline battle opens a northern front

Alberta’s recent objection to a new $1.4 billion pipeline from the northern B.C. gas fields is just the latest intrusion into a northern economy still staggered from cancellations of liquefied natural gas projects and threats to kill BC Hydro’s Site C dam.

The frustration is particularly close to the surface in the Northeast, which has the only oil and gas projects working in B.C. – those five projects a far cry from what was expected just two years ago. 

Many locals blame southern press, environmentalists and politicians for helping to scuttle resource projects that the north provides and the provincial economy depends on.

“I would not say it’s just a bit frustrating;  I would say it consumes our lives,” said Moira Green.

Green is the economic development officer for Fort St. John, the second-largest city in the north, a major natural gas hub and a city that nearly borders the $8.8 billion Site C dam.

A perceived threat to cancel Site C by the NDP provincial government in 2017 – a threat later taken off the table – stoked northern suspicion that southern politics trumps northern prosperity.

Green said it’s a never-ending source of discussion around Fort St. John, that elitist – read southern B.C. – sentiment towards projects like the Site C dam is negative, and backing resource investments for economic reasons is short-sighted and narrow-minded.

“It’s infuriating that we cannot be heard because we’re the provincials, the uneducated, the ‘how could you possibly know what’s good for us rural dwellers,’” Green said. 

Many northerners also blame the provincial government for the pipeline-sparked trade war with Alberta. They see Alberta’s filing against the new gas pipeline as just the latest salvo it that battle, though both Victoria and Edmonton deny it. 

In March, the Alberta government filed its objection over TransCanada’s $1.4 billion, 301 kilometre North Montney Mainline project that would run from the giant gas fields near Dawson Creek.

TransCanada is looking to build the repurposed pipeline to bring B.C. gas to markets in the East, as it originally planned to bring gas to the shuttered Pacific NorthWest LNG project on the northern B.C. 

But B.C. also wants to levy a tariff on the pipeline that all those using it would have to pay. The Alberta stance is that the gas pipeline would be built to benefit B.C. gas producers, but that Alberta producers would be expected to help pay for it. 

“This is all part of the politics around the oil pipelines,” said Dawson Creek Mayor Dale Bumstead of the latest interprovincial dispute. “It has just moved upstream.”

B.C. wants to restrict the flow of increased volumes of the product through the province, namely through the Trans Mountain expansion that would pipe Alberta bitumen to an export terminal in Metro Vancouver.

Alberta has already suspended electricity purchase talks with B.C., and had imposed a brief import ban on B.C. wine in protest.

Alberta’s energy minister said its stance against the Mainline gas project is unrelated. 

“Our filing has nothing to do with the recent dispute with the government of B.C. This is about standing up for Albertans and our energy industry,” said a statement emailed from the office of Alberta Energy Minister Margaret McCuaig-Boyd

“Our position is that rolled-in tariffs will result in subsidization beneficial to the B.C. North Montney extension project at the expense of existing Nova Gas Transmission Ltd. (NGTL) shippers. This negatively impacts our royalty income, taxes, and Albertans’ employment in the sector,” according to McCauig-Boyd.

Peace River South MLA Mike Bernier noted that Alberta hadn’t expressed opposition to the project until now.

“The trade war is expanding and the job losses are mounting. It is ridiculous that another project is being dragged into [B.C. Premier John] Horgan’s trade war,” Bernier said.

TransCanada had planned to start construction of the project this year, subject to regulatory approvals. It would give producers various options including deliveries to local distributors, Eastern Canada, the U.S. Midwest or California/Pacific Northwest. It would also pipe liquids needed to facilitate the flow of bitumen from the Alberta oilsands. 

A 2015 study estimated the project would pump more than $800 million into the B.C. economy, including $8 million in property taxes to the Peace River Regional District. Construction is expected to create up to 2,500 direct jobs. TransCanada said it would also add a $2.4 billion expansion to its NGTL system to deal with the increased supply.

The National Energy Board approved the North Montney Mainline pipeline in April 2015, with conditions.  B.C. granted the project an environmental certificate in January 2017.

Frank O'Brien Patrick Blennerhasset Alaska Highway News

April 4, 2018



 

 




 

TransCanada undertakes natural gas pipeline maintenance work on a pipeline in its existing Nova Gas Transmission pipeline project in northeast B.C. | TransCanada

 

Alberta’s recent objection to a new $1.4 billion pipeline from the northern B.C. gas fields is just the latest intrusion into a northern economy still staggered from cancellations of liquefied natural gas projects and threats to kill BC Hydro’s Site C dam.

The frustration is particularly close to the surface in the Northeast, which has the only oil and gas projects working in B.C. – those five projects a far cry from what was expected just two years ago. 

Many locals blame southern press, environmentalists and politicians for helping to scuttle resource projects that the north provides and the provincial economy depends on.

“I would not say it’s just a bit frustrating;  I would say it consumes our lives,” said Moira Green.

Green is the economic development officer for Fort St. John, the second-largest city in the north, a major natural gas hub and a city that nearly borders the $8.8 billion Site C dam.

A perceived threat to cancel Site C by the NDP provincial government in 2017 – a threat later taken off the table – stoked northern suspicion that southern politics trumps northern prosperity.

Green said it’s a never-ending source of discussion around Fort St. John, that elitist – read southern B.C. – sentiment towards projects like the Site C dam is negative, and backing resource investments for economic reasons is short-sighted and narrow-minded.

“It’s infuriating that we cannot be heard because we’re the provincials, the uneducated, the ‘how could you possibly know what’s good for us rural dwellers,’” Green said. 

Many northerners also blame the provincial government for the pipeline-sparked trade war with Alberta. They see Alberta’s filing against the new gas pipeline as just the latest salvo it that battle, though both Victoria and Edmonton deny it. 

In March, the Alberta government filed its objection over TransCanada’s $1.4 billion, 301 kilometre North Montney Mainline project that would run from the giant gas fields near Dawson Creek.

TransCanada is looking to build the repurposed pipeline to bring B.C. gas to markets in the East, as it originally planned to bring gas to the shuttered Pacific NorthWest LNG project on the northern B.C. 

But B.C. also wants to levy a tariff on the pipeline that all those using it would have to pay. The Alberta stance is that the gas pipeline would be built to benefit B.C. gas producers, but that Alberta producers would be expected to help pay for it. 

“This is all part of the politics around the oil pipelines,” said Dawson Creek Mayor Dale Bumstead of the latest interprovincial dispute. “It has just moved upstream.”

B.C. wants to restrict the flow of increased volumes of the product through the province, namely through the Trans Mountain expansion that would pipe Alberta bitumen to an export terminal in Metro Vancouver.

Alberta has already suspended electricity purchase talks with B.C., and had imposed a brief import ban on B.C. wine in protest.

Alberta’s energy minister said its stance against the Mainline gas project is unrelated. 

“Our filing has nothing to do with the recent dispute with the government of B.C. This is about standing up for Albertans and our energy industry,” said a statement emailed from the office of Alberta Energy Minister Margaret McCuaig-Boyd

“Our position is that rolled-in tariffs will result in subsidization beneficial to the B.C. North Montney extension project at the expense of existing Nova Gas Transmission Ltd. (NGTL) shippers. This negatively impacts our royalty income, taxes, and Albertans’ employment in the sector,” according to McCauig-Boyd.

Peace River South MLA Mike Bernier noted that Alberta hadn’t expressed opposition to the project until now.

“The trade war is expanding and the job losses are mounting. It is ridiculous that another project is being dragged into [B.C. Premier John] Horgan’s trade war,” Bernier said.

TransCanada had planned to start construction of the project this year, subject to regulatory approvals. It would give producers various options including deliveries to local distributors, Eastern Canada, the U.S. Midwest or California/Pacific Northwest. It would also pipe liquids needed to facilitate the flow of bitumen from the Alberta oilsands. 

A 2015 study estimated the project would pump more than $800 million into the B.C. economy, including $8 million in property taxes to the Peace River Regional District. Construction is expected to create up to 2,500 direct jobs. TransCanada said it would also add a $2.4 billion expansion to its NGTL system to deal with the increased supply.

The National Energy Board approved the North Montney Mainline pipeline in April 2015, with conditions.  B.C. granted the project an environmental certificate in January 2017.

 

 

Frank O'Brien

Frank O'Brien is the editor of Western Canada's biggest commercial real estate newspaper, Western Investor, as well as a contributing editor at West Coast Condominium, real estate contributor to Business in Vancouver and a regular media commentator on real estate investment.

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