Allied REIT buys out Westbank on two condo projects: Canadian real estate news for March 16
Here are The Globe and Mail’s top housing and real estate stories this week and one home worth a look.
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Canadians’ wealth is bolstered by stock rally amid housing slump, Statscan says
In the fourth quarter, households saw their net worth rise by $290-billion, or 1.8 per cent, to roughly $16.4-trillion, Statistics Canada said in a report Wednesday. But many homeowners have yet to face the full brunt of higher interest rates until they renew their mortgages, writes Matt Lundy. Others have variable-rate mortgages with fixed payments, which means that as rates have increased, more of their bill is going toward the interest portion rather than paying down the principal. The looming renewals, among other factors, led Canadians to stay cautious about taking on new debt — financial liabilities only rose by 3.4 per cent in 2023.
Allied REIT takes control of two towers co-developed with Westbank
Allied Properties REIT AP-UN-T is buying out its partner, Westbank Corp., on two office skyscrapers as the Vancouver-based real estate developer faces rising costs and legal claims at projects in Toronto and Seattle, writes Rachelle Younglai and Shane Dingman. The deal, which is expected to close in early April, will significantly cut the amount of debt Westbank owes Allied — giving them an infusion of cash in the process. In November, The Globe and Mail reported that Westbank faced legal claims for $25-million in unpaid work at the Mirvish Village development in Toronto.
Why rent inflation is much higher for rental apartments than for condos
In Canada’s overheated rental market, tenants are increasingly gravitating toward purpose-built rentals, experts say – demand that is driving up rent for these units much faster than for condos, writes Erica Alini. Advertised rents for purpose-built rentals, also called rental apartments, were up 14.4 per cent nationwide in February, compared with last year— rents for condos, on the other hand, grew by just 5 per cent in the same timeframe. A severe supply shortage, affordable prices and the allure of rent control in older buildings is driving up the prices in purpose-built rentals.
Renters have harder time accumulating wealth than homeowners, RBC report says
According to the report, homeowners have seen their net worth grow from nine times household disposable income to 13 times since 2010, while for renters, net wealth grew from three to 3.5 times over the same period. The gap has widened even though renters’ incomes have risen at the same pace as homeowners. Meanwhile, homeowners are also accumulating home equity with their housing payments. The tightening of renters’ incomes will make it even harder to save up for a down payment, economists say.
Home of the week: Festival Tower penthouse with an interior designer touch
80 John St., Upper Penthouse 1, Toronto
The 46th-floor penthouse sits right above the TIFF Lightbox theatre, which is home to the Toronto International Film Festival. When you first enter the two-bedroom-plus-den condo, you’re greeted by 11-foot-tall ceilings leading you into the living room. The previous owners had white-lacquered book cases installed on the wall separating the living area from the kitchen — which frames the spacious room — and the primary bedroom has its own hotel-style bathroom attached. The 180-degree view from the penthouse features a panoramic view of the city’s downtown. and stretches across Lake Ontario.
What do you think is the asking price for the property?
a. $2,999,000
b. $3,875,000
c. $4,195,000
d. $4,500,000
c. The asking price is $4,195,000.