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Vancouver, BC, Vacancy Rates Drop and Real Estate Transactions Soar
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(Posted on Nov 18, 2018 at 10:33AM by Danielle Smyth)
According to recent statistics, now is a fantastic time to be an investor in the commercial real estate market in Canada. For instance, especially in the office building sector in Vancouver, BC, record prices were reached in the first half of 2018. The number of sales in this category is up, too, very significantly from the same time last year.What’s more, vacancy rates have reached historic lows across all classes of real estate. This puts pressure on owner-occupiers to purchase strata units. Because of overall growth of the economy and the perceived potential for future earnings, many investors are taking this opportunity to purchase additional properties. In a lot of cases, these decisions are made more for the long-term redevelopment potential of a location than its immediate capacity to generate income for the investor.
There were $16.5 billion recorded in commercial real estate transactions throughout the nation as of September year to date, and those numbers have continued to soar. Toronto and Vancouver remain the primary buying locations, with Toronto attracting $5.7 billion and Vancouver accounting for $3.2 billion of the deals mentioned.
This means now is a great time to invest! If you’re interested in learning more, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to help!
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National Industrial Statistics for Vancouver, BC
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(Posted on Nov 18, 2018 at 10:20AM by Danielle Smyth)
According to recent reports, things are going very well for Canada when it comes to commercial real estate, particularly in the industrial sector. In fact, Ottawa and Vancouver each have fewer than two years’ supply of vacant and under construction industrial space. This is a bit below the national average, because the nation’s six largest cities have 2.6 years of supply. All markets are seeing growth, with annualized occupancy increases of 1.77 percent overall this year so far.It’s a great time to be an investor. When it comes to commercial real estate absorption, this year has seen 6,877,000 square feet, representing an increase in absorption of 4,168,000 square feet over this year’s second quarter numbers. Specifically, there has been absorption of between 2.9 million  and 3.8 million square feet so far this year in Toronto, Edmonton and Vancouver. Even better, the national average vacancy rate for markets that have over one million residents has dropped significantly, falling to 2 percent. This is a new record for the category.
If you’re interested in learning more about opportunities for investment throughout Canada, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
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Affordable Housing Programs Impact Investors in Vancouver, BC
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(Posted on Nov 16, 2018 at 11:37AM by Danielle Smyth)
Keep an eye on the housing market in Vancouver, BC. According to a recent report, big changes are on the horizon, especially in the Burnaby area. Thanks to several recent political shifts, affordable housing may grow more and more possible for large portions of the population.According to The Globe and Mail, since 2002, many residents of Burnaby have been forced to relocate to neighboring cities and towns due to a lack of affordable housing. Apartments that would have been within reach for many families were replaced with higher-end properties that they could ill afford.
As a result, the recent election brought to light many candidates with a vision for change in the Burnaby housing market. Vancouver, for instance, is looking to build 600 temporary modular units housing for those who are homeless. In addition, affordable housing endowments could be used to collect land for building projects. According to the article, “If Burnaby develops strong policies to protect rentals and develop non-market and social housing...it will help ease the stress on Vancouver and New Westminster.â€
Would you like to learn more about how this could impact you as a commercial investor? Get in touch with Marcus & Millichap's Vancouver office today! One of our experienced commercial real estate advisors will be happy to provide additional information.
2018 Housing Market Outlook for the Vancouver, BC, Area
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(Posted on Nov 16, 2018 at 11:21AM by Danielle Smyth)
Good news for investors in the Vancouver, BC, area! According to the Canada Mortgage and Housing Corporation's 2018 Housing Market Outlook, markets throughout the country “should see a moderation in both housing starts and sales in 2019 and 2020, while home prices are expected to reach levels that are more in line with economic fundamentals such as income, job and population growth.â€They expect that trends will begin to move downward, from 193,700 to 204,500 sales in both the single and multi-unit markets. In addition, MLS sales should be somewhere between 478,400 and 497,400 units, with prices between $501,400 and $521,600.
This means now is a great time to invest, if you’re planning on breaking in to the multi-unit housing market. Income, job, and population growth are leveling off, which could indicate an increased need for apartments and two-family homes that would make for a solid investment.
Curious how trends like these might ultimately affect the market in BC? Get in touch with Marcus & Millichap's Vancouver office. Ask to speak with one of our experienced commercial real estate advisors, who will be happy to help!
Commercial Real Estate is Stable in Vancouver, BC
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(Posted on Nov 11, 2018 at 04:44PM by Danielle Smyth)
In a recent report, Marcus & Millichap analysts have reported that stock market volatility has not had a negative impact on commercial real estate. Instead, they indicate that the stability of commercial real estate is “increasingly appealing for investors.†You might wonder why this is the case. Well, they explain, “carrying competitive yields and relatively less volatility, commercial real estate represents a viable alternative to equities. Additionally, property values typically reflect the economic strength of the real economy, underpinned by low unemployment, positive demographics and continued growth in consumer spending, reinforcing a healthy outlook for the coming year.â€This is great news for anyone considering an investment in commercial real estate. The report further suggests that commercial leases align quite well with the rise in inflation. Over the past 12 months, core CPI has risen 50 basis points to 2.2 percent. In addition, many commercial leases tend to have built-in clauses that speak to inflation adjustments or lease resets, so that investors can deflect the costs that might be associated with an increase over time.
If you’re interested in learning more about opportunities for investment throughout Canada or how economic changes might impact you, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
Rental Properties Win Big This Quarter in Vancouver, BC
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(Posted on Nov 11, 2018 at 04:35PM by Danielle Smyth)
According to a recent report, home sales have slowed in Canada. Though the 30-year mortgage rate has remained low, it has increased since 2011, reaching its highest level in those 7 years. As a result, much of the demand in the housing market has shifted towards apartments and rental units. Clearly, this is great news for commercial real estate investors who might be considering the purchase of such properties.Analysts from Marcus & Millichap report that the median price of an existing single-family home as of August 2018 is $267,300. They anticipate that there are 4.3 months of stock, assuming that things continue on pace as they have been. The monthly mortgage payment for a home is now $339 more than an average monthly rent, which could further encourage potential buyers to rent instead.
Furthermore, continued job growth is leading to the formation of more households. However, demand is concentrated in apartments. As a result, there are fewer and fewer multifamily units available. The report states that “Nationally, nearly 82,900 units were constructed in the third quarter, but the positive absorption of more than 107,000 units pushed down the third quarter apartment vacancy rate 40 basis points from the previous quarter to 4.2 percent, the lowest level since 2001.â€
If you’re interested in learning more about opportunities for investment throughout Canada, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
Great News for Vancouver, BC, Commercial Real Estate Investors
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(Posted on Nov 11, 2018 at 04:22PM by Danielle Smyth)
A recent report on updates to the market in Vancouver revealed some great news for Canadian investors. For instance, on the whole, the nation saw an overall growth of 2.5%, annualized, year-over-year. In addition, when it came to office space, finance- and insurance-related companies saw gains of about 1.0 percent. General real estate was also up, seeing a 0.3 percent increase largely tied to home sales. Professional services saw similar gains.According to CoStar Canada, “The  office, industrial and retail commercial real estate markets in the [Greater Vancouver Area] remain deeply embedded in favour of landlords.†They spoke further to the increased demand from companies like Amazon, as well as co-working companies, all of whom are seeking office and warehousing space in the Vancouver region. The market assessment further stated that, despite “an additional 2.4 million SF of retail space currently under construction, due to low vacancy and relatively consistent demand, rental rates are expected to continue rising.â€
All of this is excellent news for investors, who should take the leap now if they wish to grab hold of some amazing opportunities in Vancouver. Don’t miss out on this wonderful chance! If you’re interested in learning more about opportunities for investment, contact Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to help you!
Commercial Real Estate Property Tax Ratios in Vancouver, BC
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(Posted on Nov 10, 2018 at 08:57PM by Danielle Smyth)
The commercial real estate property tax ratio is high in Canada, says a recent report. In fact, commercial taxes are almost three times as high as property taxes. In Vancouver, the ratio is even higher, at four to one. This is in spite of the fact that the city had the largest decrease, of 9.72 percent, and the largest drop in its commercial tax rate, at 12.78 percent. This is because commercial real estate values increased at a higher rate than residential values.According to the article, Vancouver remains a hot market for commercial real estate. This is great news for investors. Having a sizable tax base of commercial buildings in the city is a wonderful thing, as it encourages growth and makes the city seem like a great place for businesses to move. Toronto, also, is doing very well in this regard and remains a wonderful place for investors.
If you’re interested in learning more about opportunities for investment throughout Canada or about how commercial real estate property tax ratios can be beneficial for you, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
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Bidding Wars in Kitimat are Great for Vancouver, BC, Investors
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(Posted on Nov 10, 2018 at 08:37PM by Danielle Smyth)
In Kitimat, bidding wars on commercial real estate are creating soaring rents. This is all a result of the fact that the LNG Canada project was recently approved. The $40 billion liquefied natural gas pipeline is going to make a huge impact on the market throughout the area.Since the October 1 approval of the pipeline, rents and prices in home sales have soared. For instance, the average house price in the area has jumped to $256,500, up from $214,800 a year ago. Virtually no housing has been built in the area in recent years, and a whopping 42% of apartment units are vacant. This is good news for real estate investors, though, since rents could now be set at much higher levels in those properties.
Investors in the Kitimat area are being cautioned to move quickly if they want to get in on these fabulous opportunities, because homes and units are selling so fast. Don’t miss out on this wonderful chance! If you’re interested in learning more about opportunities for investment while there’s still time, get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
Vancouver, BC's New Mayor to Tackle Housing Crisis
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(Posted on Nov 10, 2018 at 08:25PM by Danielle Smyth)
Kennedy Stewart, the new mayor of Vancouver, has vowed to tackle the housing crisis immediately. The city’s first independent mayor in over 30 years, he campaigned on a promise of building 85,000 units of non-profit, rental, and market housing over the course of the next ten years. In addition, Stewart has sworn to triple the empty-homes tax and protect as much as one-half of the homes in the city from foreign speculation.Stewart was quoted as saying that he is frustrated by the possibility that a company might “operate a business for 30 years in one location and they rezone your area or a development permit gets approved, the building won’t be built for five years, but your commercial property taxes go through the roof, and because of the triple-net lease, you’re responsible for them.†As such, he is hoping to look at assessments on commercial properties.
All of this is could be good news for investors in the long run, as policies shake out and encourage growth of business in the city. Curious how trends like these might ultimately affect the market in Vancouver, BC? Get in touch with Marcus & Millichap's Vancouver office. One of our experienced commercial real estate advisors will be happy to provide additional information.
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