{"id":7403,"date":"2016-09-30T17:05:05","date_gmt":"2016-09-30T21:05:05","guid":{"rendered":"http:\/\/www.zoocasa.com\/blog\/?p=7403"},"modified":"2016-09-30T17:05:05","modified_gmt":"2016-09-30T21:05:05","slug":"monthly-real-estate-recap-september","status":"publish","type":"post","link":"https:\/\/www.zoocasa.com\/blog\/monthly-real-estate-recap-september\/","title":{"rendered":"Monthly Real Estate News Recap: September"},"content":{"rendered":"<p>The fall <a href=\"http:\/\/www.zoocasa.com\/\">real estate<\/a> market is always a busy one \u2013 in the listings and in the headlines. September has been no exception; from a new foreign investment tax, to bubble fears, to accusations of money laundering, here are the hottest housing news headlines this month.<\/p>\n<h2>A Whole Lot of Nothing<\/h2>\n<p>The Bank of Canada kicks things off anticlimactically with its September 7 <a href=\"http:\/\/www.ratehub.ca\/blog\/no-change-to-bank-of-canada-key-rate\/\" target=\"_blank\">interest rate announcement<\/a>, opting to leave its trend-setting rate untouched at 0.5%, where it has remained since July 2015. It\u2019s a non-move that signals the central bank may be hunkering down on monetary policy for the long term \u2013 meaning mortgage rates will remain at historic lows for the time being.<\/p>\n<p>The BoC says slower GDP due to Alberta\u2019s massive wildfires, weaker global conditions and a downside tilt to inflation are the main motivations for keeping rates low. However, it is optimistic the economy will see an uptick\u00a0in the third quarter, as oil production is expected to recover.<\/p>\n<h2>The New Reigning Champ<\/h2>\n<p>Toronto has officially usurped the title of hottest market in Canada from Vancouver, as the west-coast city experiences a drop in demand due to its new <a href=\"http:\/\/www.zoocasa.com\/blog\/vancouver-real-estate-sales-drop-26\/\">15% foreign investment tax<\/a>. This is according to TD economist Diana Petramala, who points to the 18% increase in housing prices in Toronto since 2015, and the city\u2019s record August sales numbers. Do they give out trophies for unaffordability?<\/p>\n<h2>Calling for Backup<\/h2>\n<p>Canadian Finance Minister Bill Morneau states the usual methods used to correct housing prices may be too little too late for the Toronto and Vancouver markets. Officials are currently considering all actions to cope with these \u201chighly charged\u201d markets, he stated, but added it\u2019s important to target them without negatively impacted Canada\u2019s other housing centres. According to Morneau, it\u2019s also too soon to tell if BC\u2019s foreign investment tax will truly solve the market\u2019s problems, saying it will take time for the benefits to be fully recognized.<\/p>\n<h2>A National Revision<\/h2>\n<p>The Canadian Real Estate Association revised its forecast for home sale activity via MLS, saying that while most markets are performing in line the association\u2019s expectations, Toronto and Vancouver are skewing the national numbers. CREA has since slashed Vancouver\u2019s forecast, accounting for the sharp downturn in sales, and has revised Ontario\u2019s higher, given there\u2019s no slowdown in sight for housing demand. It also tweaked Alberta\u2019s; the embattled oil province experienced better-than-expected activity in Q2.<\/p>\n<p>On a national level, CREA calls for a 6% sales activity increase, to 535,900 units in 2016 \u2013 up from its previous forecast of 6.1%. It also forecasts the national sales price to price 10.1%, to $487,800.<strong>\u00a0<\/strong><\/p>\n<h2>A Money Laundering Scandal<\/h2>\n<p>Canadian real estate is effectively acting as a front for massive money laundering practices, according to a report from the Paris-based Financial Action TaskForce. The study finds that Canadian real estate is at high risk of illicit activity, and a weak spot in the government\u2019s efforts to combat money laundering. The charitable and life insurance sectors were also named as high-risk industries.<\/p>\n<p>According to the TaskForce, money is easily moved around in schemes where foreign or domestic criminals funnel cash to local buyers who then sink it into the market, or by combining loans and mortgages via lawyer\u2019s trusts. The report alleges such activity is easily overlooked by financial agencies, which only do a cursory review into a buyer\u2019s potential connection to a criminal or terror group. The issue extends beyond Canada\u2019s biggest markets; Quebec was also identified as a hotspot.<\/p>\n<h2>Practically a Steal?<\/h2>\n<p>Despite numerous reports on how overpriced Canadian real estate has become, one new report says it\u2019s a relative bargain: A Bank of America Merrill Lynch Global Research study finds Canadian real estate is quite affordable for Americans \u2013 and Asians \u2013 due to the lower Canadian dollar.<\/p>\n<p>\u201cHomes are cheaper on both a U.S. dollar-adjusted and Chinese renminbi basis than in 2010 \u2013 2014,\u201d the report states. \u201cDespite high rates of home price appreciation, the continued appeal of Canadian real estate is reflected when adjusting home prices for the substantially weaker Canadian dollar.\u201d<\/p>\n<h2>Count on Lower for Longer<\/h2>\n<p><a href=\"http:\/\/www.bankofcanada.ca\/2016\/09\/living-lower-longer\/\" target=\"_blank\">In comments<\/a> made by Bank of Canada Governor Stephen Poloz to an audience of economists in Quebec, interest rates will stay low for the long term \u2013 and everyone needs to get on board.<\/p>\n<p>The governor points to factors such as low inflation, which are forcing interest rates lower in economies around the world, while acknowledging lower rates, while positive for home buyers, are making it tough for Canadian seniors to prepare for retirement. People are \u201crightly worried about their ability to live off their savings,\u201d he stated. \u201cI can certainly sympathize and understand these concerns.\u201d<\/p>\n<p>Poloz also indicates the corporate world must also adjust their interest rate expectations, as investment returns will likely never return to pre-crisis levels.<\/p>\n<h2>The Biggest-Ever Bubble<\/h2>\n<p>Everyone knows Vancouver\u2019s housing market is too-hot-to-touch \u2013 but it\u2019s also the riskiest in the world, according to a study by Swiss bank UBS. The Global Real Estate Bubble Index finds Vancouver is most vulnerable to a sudden downward correction in housing prices. The report assessed and ranked 18 global markets on how they\u2019d be affected by a rapid and steep increase in average housing prices, including economic factors such as wages, rents, lending patterns and construction activity.<\/p>\n<p>Vancouver was singled out after seeing real estate prices surge 25%. \u201cOver the last two years, the housing market has gone into overdrive due to strong demand for local properties among foreign investors and a loose monetary policy,\u201d states the report. \u201cCurrently, house prices in Vancouver seem clearly out of step with economic fundamentals and are in bubble risk territory.\u201d<\/p>\n<p><strong>What do you think the hottest real estate topic was this month? Tell us in the comments, or visit us on Twitter at <a href=\"http:\/\/www.twitter.com\/zoocasa\/\" target=\"_blank\">@Zoocasa<\/a>.<\/strong><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The fall real estate market is always a busy one \u2013 in the listings and in the headlines. September has been no exception; from a new foreign investment tax, to bubble fears, to accusations of money laundering, here are the hottest housing news headlines this month. A Whole Lot of Nothing The Bank of Canada [&hellip;]<\/p>\n","protected":false},"author":39,"featured_media":7405,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":[],"jnews_primary_category":[],"footnotes":""},"categories":[33],"tags":[],"class_list":["post-7403","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Monthly Real Estate News Recap: September | Zoocasa Life<\/title>\n<meta name=\"description\" content=\"Missed out on September&#039;s real estate news? 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Check out September&#039;s hottest headlines in Zoocasa&#039;s monthly real estate new recap.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.zoocasa.com\/blog\/monthly-real-estate-recap-september\/\" \/>\n<meta property=\"og:site_name\" content=\"Zoocasa Blog\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Zoocasa\" \/>\n<meta property=\"article:published_time\" content=\"2016-09-30T21:05:05+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.zoocasa.com\/blog\/wp-content\/uploads\/2016\/09\/Real-Estate-News.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"600\" \/>\n\t<meta property=\"og:image:height\" content=\"402\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Penelope Graham\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Zoocasa\" \/>\n<meta name=\"twitter:site\" content=\"@Zoocasa\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Penelope Graham\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.zoocasa.com\/blog\/monthly-real-estate-recap-september\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.zoocasa.com\/blog\/monthly-real-estate-recap-september\/\"},\"author\":{\"name\":\"Penelope Graham\",\"@id\":\"https:\/\/www.zoocasa.com\/blog\/#\/schema\/person\/9a2554dc39c550f5ef3339b25aa1f09c\"},\"headline\":\"Monthly Real Estate News Recap: September\",\"datePublished\":\"2016-09-30T21:05:05+00:00\",\"dateModified\":\"2016-09-30T21:05:05+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.zoocasa.com\/blog\/monthly-real-estate-recap-september\/\"},\"wordCount\":970,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.zoocasa.com\/blog\/#organization\"},\"articleSection\":[\"Real Estate News\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.zoocasa.com\/blog\/monthly-real-estate-recap-september\/\",\"url\":\"https:\/\/www.zoocasa.com\/blog\/monthly-real-estate-recap-september\/\",\"name\":\"Monthly Real Estate News Recap: September | Zoocasa Life\",\"isPartOf\":{\"@id\":\"https:\/\/www.zoocasa.com\/blog\/#website\"},\"datePublished\":\"2016-09-30T21:05:05+00:00\",\"dateModified\":\"2016-09-30T21:05:05+00:00\",\"description\":\"Missed out on September's real estate news? 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