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Toronto’s ‘Google City’ will get $1.3 billion investment

A plan to create a modern, high-tech city in Toronto will benefit from a C$1.3 billion (U$980 million) investment from Alphabet Inc. but the project has raised some questions from Waterfront Toronto.

The parent of Google will invest in the project through its Sidewalk Labs subsidiary and aims to work with local partners to finance the $3.9 billion development on Lake Ontario.

The plan to create a five-hectare neighbourhood includes tall-timber housing and a new Canadian HQ for Google and was set out by the firm in document released Monday.

“Our plan puts the public sector in the driver’s seat in ways that’s not the norm for a lot of tech companies in the world,” Dan Doctoroff, the company’s chief executive officer told Bloomberg at a media briefing. “Sidewalk aims to partner with the government in order to create the conditions for real estate developers, civic organizations, tech companies, and residents, workers and visitors to build a great community in the decades to come.”

Addressing housing affordability, Sidewalk has said that half of the residential units built would be purpose-built rentals, with 40% larger apartments with 2 or more bedrooms.

4 in 10 of all residential units built would be below-market rates and it believes that could bring around 1,700 below-market rate homes to the area.

Sidewalk will not be leading the entire development but focus instead on the area of the Google headquarters, around 7% of the entire project.

Waterfront Toronto concerns
In an open letter Stephen Diamond, the chairman of the board of directors of Waterfront Toronto, the body responsible for the revitalization of the waterfront, has responded with some concerns about the Sidewalk Labs Master Innovation and Development Plan (MIDP).

“Based on our initial review of the MIDP, there are a number of exciting ideas that respond to challenges we face, particularly related to environmental sustainability and economic development. There are also proposals where it is clear that Waterfront Toronto and Sidewalk Labs have very different perspectives about what is required for success,” wrote Diamond.

He set out the early causes for concern:

Sidewalk Labs proposes the up-front creation of an IDEA District that covers a much larger area than the 12 acres of Quayside. Waterfront Toronto has told Sidewalk Labs that the concept of the IDEA District is premature and that Waterfront Toronto must first see its goals and objectives achieved at Quayside before deciding whether to work together in other areas. Even then, we would only move forward with the full collaboration and support of the City of Toronto, particularly where it pertains to City-owned lands.
Sidewalk Labs proposes to be the lead developer of Quayside. This is not contemplated in the PDA. Should the MIDP go forward, it should be on the basis that Waterfront Toronto lead a competitive, public procurement process for a developer(s) to partner with Sidewalk Labs.
Sidewalk Labs’ proposals require future commitments by our governments to realize project outcomes. This includes the extension of public transit to Quayside prior to development, new roles for public administrators, changes to regulations, and government investment. These proposals raise important implementation concerns. They are also not commitments that Waterfront Toronto can make.
Sidewalk Labs has initial proposals relating to data collection, data use, and digital governance. We will require additional information to establish whether they are in compliance with applicable laws and respect Waterfront Toronto’s digital governance principles.
A review and evaluation process is now beginning including consultations with the public and other stakeholders.

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Why are Toronto condo sales finally slowing down?

Toronto condo prices might hit a ceiling soon.

When Toronto’s market began correcting in 2017, it appeared someone forgot to tell the condo market. Sales and prices soldiered on upwards, while the low-rise market languished — but the soaring performance of the high-rise segment could be winding down, suggests realtor John Pasalis.

Pasalis, whose research work has been cited by the Bank of Canada, outlines what he says is behind slackening sales, which are down nominally for the first five months of this year when compared to the same period in 2018.

“What’s the cause of this cooling in demand for condos? High prices,” writes Pasalis, also the president of the Toronto-based Realosophy brokerage, in a blog post.

“More specifically, the fact that condo prices have been rising while low-rise prices have been trending down — condos are starting to look a bit expensive relative to detached and semi-detached houses,” he explains.

According to May home sales data from the Toronto Real Estate Board, the average price of condo apartment is $590,876 compared to $1,042,218 for a detached home. While the difference in price is no small amount, it’s less pronounced than it was at the height of the market, Pasalis notes.

The Toronto housing market peaked in March 2017, and when it did, the gap between condo prices and detached home prices was a lofty $700,000. As of May, the price gap narrowed to $450,000, according to Pasalis’ calculations.

Over that two-plus-year period, condo-apartment prices increased 14 percent, while row house and condo townhouse values are approximately flat.

The new-condo segment is already seeing more muted gains. In April, the average asking price for an available new condo was $758,585, an increase of 2.5 percent from a year earlier, according to the Building Industry and Land Development Association.

So what’s the upshot of all this?

“The supply for condos is still relatively tight which is keeping prices up, but if we continue to see a cooling in the demand for condos, we may see condo prices hit a plateau,” Pasalis concludes.

For now, listings remain down from a year ago. At the end of May, there were 3,806 condos listed on the market in the GTA, down from 3,993 in May 2018.

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First-Time Home Buyer Incentive

The First-Time Home Buyer Incentive (the Incentive) helps qualified first-time homebuyers reduce their monthly mortgage carrying costs without adding to their financial burdens.

You need to have the minimum down payment to be eligible. You can then apply for a 5% or 10% shared equity mortgage with the Government of Canada. Your maximum qualifying income is no more than $120,000 and your total borrowing is limited to 4 times the qualifying income.

The Incentive has an equity-like payout, where the government would share in the upside and downside of the property value.

The First-Time Home Buyer Incentive launches September 2, 2019*.

* Barring any unforeseen circumstances the program will launch on September 2, 2019. The first closing will take effect on November 1, 2019.

Program Details

How does it work?
The Incentive enables first-time homebuyers to reduce their monthly mortgage payment without increasing their down payment. The Incentive is not interest bearing and does not require ongoing repayments.

Through the First-Time Home Buyer Incentive, the Government of Canada will offer:

-5% of a first-time buyer’s down payment for the purchase of a re-sale home

-5% or 10% of a first-time buyer’s down payment for the purchase of a new construction

How do I know how much I have to pay back?
You can repay the Incentive at any time without a pre-payment penalty. You have to repay the Incentive after 25 years or if the property is sold. The repayment of the Incentive is based on the property’s fair market value:

  • You receive a 5% incentive of the home’s purchase price of $200,000, or $10,000. If your home value increases to $300,000 your payback would be 5% of the current value or $15,000.
  • You receive a 10% incentive of the home’s purchase price of $200,000, or $20,000 and your home value decreases to $150,000, your repayment value will be 10% of the current value or $15,000.

NOTE: If your property value goes down, you are still responsible for repaying the shared equity mortgage based on the current home value at time of repayment.

 

Funding Available
The First-Time Home Buyer Incentive works on a first-come-first-serve basis. The total amount of funding will be $1.25 billion over 3 years.

Eligibility & Requirements

Who can apply?

  • Canadian citizens, permanent residents, and non-permanent residents who are legally authorized to work in Canada
  • Borrowers must have a maximum qualifying income of $120,000
    -Total qualifying income cannot exceed $120,000 per year
    -This is subject to qualifying income requirements set out by lenders and mortgage loan insurers
  • At least one borrower must be a first-time homebuyer, as per the definition below.

Are you a first-time homebuyer?

You are considered a first-time homebuyer if you meet one of following qualifications:

  • you have never purchased a home before
  • you have gone through a breakdown of a marriage or common-law partnership (even if you don’t meet the other first-time home buyer requirements).
  • in the last 4 years, you did not occupy a home that you or you current spouse or common-law partner owned
  • IMPORTANT: With the 4-year clause, it is possible that you or your spouse or common-law partner qualifies for the first-time homebuyer incentive (if you are in a married or common-law relationship). Even if you or your spouse or common-law partner has previously owned a home in the last 4 years.

How does the 4-year period work?

  • The 4-year period begins on January 1 of the fourth year before the year you purchased your home. It ends 31 days before the date you purchase your new home. Here are a few examples:
    -if you purchase a home on March 31, 2015, the 4-year period begins on January 1, 2015 and ends on February 28, 2019
    -if you sold your home you lived in in 2013, you may be able to participate in 2018 or if you sold the home in 2014, you may be able to participate in 2019

Are there other mortgage details?

  • Total borrowing is limited to 4 times the qualifying income. The combined mortgage and Incentive amount cannot exceed four times the total qualifying income.
  • The amount for the mortgage loan insurance premium is excluded from this calculation.
  • The Incentive will be a second mortgage on the title of the property. There will be no regular principal payments, it’s not interest bearing and has a maximum term of 25 years.
  • The Incentive will have an equity-like payout, where the Government of Canada will share in the upside and downside of the property value upon repayment.

Is Mortgage Loan Insurance required?

  • Mortgages must be eligible for mortgage loan insurance. The first mortgage must be greater than 80% of the value of the property. This is subject to a mortgage loan insurance premium based upon the amount of the first mortgage.
  • Mortgage loan insurance premiums may be subject to provincial taxes.

What are the down payment requirements?

  • Minimum down payment is 5% of the first $500,000 of the lending value. It is 10% of the lending value above $500,000 from traditional down payment sources.
  • Traditional down payment comes from the borrower’s own resources and may include:
    -savings
    -withdrawal/collapse of a registered retirement savings plan (RRSP)
    -non-repayable financial gift from a relative
    –Note: Unsecured personal loans or unsecured lines of credit used to satisfy minimum down payment requirements are not eligible for the program.

What properties are eligible?

  • The Incentive is to help first-time homebuyers purchase their first home. Eligible properties include:
  • 1 to 4 unit residential properties which includes

-new construction

-re-sale home
-new and re-sale mobile/manufactured homes

  • The property must be located in Canada and must be suitable and available for full-time, year-round occupancy.

What are the terms of repayment?

  • The first-time homebuyer will be required to repay the Incentive amount after 25 years or when the property is sold, whichever comes first. The homebuyer can also choose to repay the Incentive in full at any time, without a pre-payment penalty.

 

How is repayment calculated?

  • If a homebuyer receives a 5% (or 10%) Incentive, he would repay 5% (or 10%) of the home’s value at repayment.
  • Repayment is based on the property’s fair market value.

 

Let’s look at a specific situation
Anita wants to buy a new home for $400,000.

Under the First-Time Home Buyer Incentive, Anita can apply to receive $40,000 in a shared equity mortgage (10% of the cost of a new home) through the program. This is on top of the minimum required down payment of $20,000 (5% of the purchase price) from her savings.

This lowers the amount she needs to borrow and reduces her monthly expenses.

As a result, Anita’s mortgage is $228 less a month or $2,736 a year.

* This example is for illustrative purposes only. Anita will need to repay the incentive at 10% of the fair market value when she sells the property or after 25 years, whichever is earliest.

Here’s another situation
John has an annual qualifying income of $83,125.

To be eligible for Canada’s First-Time Home Buyer Incentive, he can purchase a home up to $350,000. John still has the required minimum down payment of 5% of the purchase price, $17,500 from his savings. He can receive $35,000 in a shared equity mortage — 10% of a newly constructed home.

This would reduce John’s mortgage payments by $200 a month or $2,401 a year.

* This example is for illustrative purposes only. John will need to repay the incentive at 10% of the fair market value when he sells the property or after 25 years, whichever is earliest.

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The Well is expected to add over $4 billion in economic activity to downtown Toronto

Picture-perfect skies served as the backdrop to this week’s special event and launch of the residential condominium component at The Well by Tridel. Situated on the northwest corner of Front Street West and Spadina Avenue, The Well is a master-planned community now under construction that will transform the former Globe & Mail site with a diverse mix of shops, restaurants, workspaces and residences.

The ambitious development project is the largest of its kind in Toronto at 7.8 acres and is expected to generate $4.2 billion in economic activity upon full completion, according to a new report by Altus Group. The details of the report were unveiled Monday afternoon by Toronto Mayor John Tory alongside Tridel Executive Vice-President Andrew DelZotto, Tridel Director and Executive Vice-President Andrea DelZotto, RioCan President and COO Jonathan Gitlin, and Woodbourne President Jake Herman, who, together with Allied Properties, make up the development team behind The Well.

“The Well is a transformational project and one of the most complex, multi-faceted developments Tridel has ever worked on,” said Andrew DelZotto. “This is choreographed city building, and it’s an honour and privilege to know that together with our collaborators at RioCan, Allied and Woodbourne, we are generating billions of dollars in economic activity and contributing directly to the growth of Toronto and the GTA as a whole.”

A large portion of the annual economic benefits of The Well stem from its commercial spaces, retail stores and overall management of the property. When completed, the development will be comprised of seven mixed-use towers and mid-rise buildings, space for 5,000 new office jobs, 1,200 new retail jobs, and over 750 new condominium units by Tridel.

Designed as an extension to the urban vibrancy and feel of King West, The Well is anticipated to become an exciting lifestyle and entertainment hub in the heart of downtown Toronto. Residents of the condominiums and rental suites will have access to world-class food markets, innovative retailers, globally-inspired restaurants, and modern office spaces all within a pedestrian and public transit-friendly neighbourhood.

Multiple architectural teams and visions came together to tell a cohesive story characterized by modern structures that pay homage to the neighbourhood by pulling visual cues from the existing architecture along King Street West. In addition to the gleaming glass towers and brick-clad podiums, The Well boasts a soaring glass canopy and centre atrium, sheltering pedestrians as they move along the multi-level shopping concourse and verdant green spaces.

“The Well has the ability to transform the downtown core and create an entirely new community,” said Mayor John Tory. “Investments like this are a reflection of the growth we are experiencing in Toronto and the confidence that businesses have in our city.”

Three purpose-built rental buildings will be developed by Rhapsody Property Management Services and RioCan Living, while the three condominiums, named the Classic Series I, II and the Signature Series are by Tridel. Classic I and II will take the form of two high-rise towers standing at 38- and 22-storeys tall , and the Signature Series will be a 14-storey midrise facing Wellington Street. Suites will offer thoughtfully-designed layouts, stunning views of the city and streetscapes, and expansive windows allowing for abundant natural light. The first occupancies at The Well are slated for late 2022.

 

 

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Toronto is growing faster than any other city in Canada and the US

It doesn’t look like underlying demand for Toronto housing is relenting, as the city is the fastest growing in not just Canada but the US as well.

Experts often talk about population growth as a fundamental driver of housing demand, and new analysis from Ryerson’s Centre for Urban Research and Land Development puts Toronto’s in perspective.

In fact, in a 12-month period ending last July, the city’s population ballooned by a jaw-dropping 77,435 people.

For context, the second-fastest-growing city, Phoenix, added 25,288 people over the same period.

Toronto’s gains overshadowed the combined population increases of America’s three most rapidly growing cities. Third-ranked San Antonio added 20,824 people, while Fort Worth followed at 19,552.

In a comparison of broader metro area’s, Toronto places second claiming 125,298 new residents in 12 months versus the Fort Worth area’s 131,767.

“The sources of growth for Toronto and Dallas-Fort Worth-Arlington metropolitan areas were quite distinct,” reads the blog post by the centre’s director Frank Clayton and researcher Hong Yun Shi.

“For metropolitan Dallas-Fort Worth-Arlington, births were by far the largest component of growth, followed by net domestic migration and net international migration,” they continue.

Meantime, Toronto international migration was the biggest contributor to the metro area’s population boom, with births a secondary source.

“Net migration into Toronto from other parts of Canada was very small compared to Dallas-Fort Worth-Arlington,” the blog post states.

Migration into Canada’s biggest cities has been a boon for residential construction investment as homebuilders continue to break ground for more housing for all these new arrivals.

Municipalities across the country issued $4.8 billion worth of residential building permits in March alone, according to the latest data from Statistics Canada.

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Top 10 Richest People In The World

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Toronto New Home and Condo Sales up 120 % in April

Following last month’s explosion in search and purchase requests from Toronto condo buyers,

GTA new home and condo sales are up 120 % from April of 2018.

According to Altus, high-rise condo sales are up 137% from April 2018, as well as low-rise sales, up 81%.

Considering, April’s increases in both purchase requests and sales, our user insights have reported a 20% increase in purchase requests in May of 2019 from May of 2018.

Could this continued wave in interest indicate another potential sales surge?

Let us know what you think.

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