Article courtesy of Real Estate Board of Greater Vancouver, Commercial Market News, February 2012

The BCREA Commercial Leading Indicator (CLI) rose for the second consecutive quarter, advancing 1.1 points to an index level of 111. On a fourth-quarter over fourth-quarter basis, the CLI moved 1.6 per cent higher in 2011. While this is a marked slowing from the 5.2 percent surge in 2010, the index picked up considerable momentum in the third and fourth quarter of the year, more than making up for a weak first half of 2011.

The trend in the CLI turned up slightly as early softness in economic activity was smoothed out by a stronger second half of the year. This change in trend indicates a positive economic environment for the BC commercial real estate sector in 2012. “Improving economic data provided a strong tailwind for the CLI in the second half of 2011,” said Brendon Ogmundson, BCREA Economist. “However, growing anxiety surrounding the global economy could constrain the economic environment for commercial real estate this year.”The full BCREA Commercial Leading Indicator index is available at:

Francine Tracey


Real Estate Investment Opportunities: (Referral Fees Paid to any licensed mortgage broker or real estate agent and non-licensed agents will receive a generous gift)


I currently have the following investment opportunities on my desk. These investments range from $50,000 to $4,500,000.


  • $50,000 minimum: Developer selling limited partnerships in his property which is a multi family condiminimum project located in the desireable Commercial Drive area. This developer has another project in the same area which may be reviewed by the investor as to it's progress and success.
  • $100,000: Busy and reputable café for sale in the Commercial Drive area.
  • $131,800: Purchase a revenue property in the desireable Vancouver Heights area, the lowest price in the neighbourhood at $659,000. This is a well maintained, fully renovated four bedroom home. Minimum down payment if the buyer is intending to live in the property: only $32,950.
  • $150,000: Established Granite Counter Top and Custom Granite works shop for sale in the Richmond area.
  • $1,125,000: Industrial property owner in Surrey BC requires a quick sale of his property. Property appraised at $5,800,000. Owner willing to review any reasonable offer. Current mortgage lender willing to extend mortgage terms to new buyer with minimum investment of $1,125,000. This property requires some slight renovations for excellent upside potential for the right investor.
  • 1,200,000 - $2,200,000: Did you know CMHC reports on Saskatchewan are extremely favourable? Saskatchewan boasts a strong economy with excellent resource base including food, potash, and much more. Real estate markets there are still showing excellent value and are trending upwards. I have a developer wanting to sell 25% of his property to raise funds for his multi family project there, which is 50% presold. Minimum investment is $1,200,000. Projected return based on pre-sale prices in the 64% range. This opportunity can also be structured as a mortgage investment at 20% return.
  • $2,950,000 – Development site in New Westminster, in highly desireable up and coming neighbourhood, for mixed use multi-family / retail building.


Commercial Lease Space:


  • Currently working on leasing up 20,000 square feet of warehouse space in east Vancouver neighbourhood. Excellent building in clean neighbourhood. Can portion the space down to minimum 5,000 square feet for the right tenant.
  • Coming soon: 3500 square feet of office space in a building under renovations in Mount Pleasant neighbourhood on Broadway. Spaces can as small as 400 square feet available. As renovations are currently in the works the space can be customized for the new tenants needs.
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Summary highlights from CMHC’s Canadian Housing Observer 2011 Report:

(Substantially  based on 2010 data)


Although this report is substantially based on 2010 data, it is insightful and important points are made for making real estate decision moving forward.  CLICK HERE to review the full PDF report from CMHC.



Canadian Household Finance

  • During 2011 the Bank of Canada increased it’s lending rate by .75% from .25% to 1.0%
  • Residential mortgages grew to 1.042 Trillion as of March 2011.
  • In 2010 mortgages represented 68% of household debt. 
  • Household liabilities increased faster than assets and net worth during 2000-2010 period
  • Personal lines of credit have increased in popularity taking over for personal loans.
  • Most mortgage holders have substantial equity in their homes with 79% of home owners with greater than 25% equity (note that in US more than 25% of home owners had mortgages greater than the value of their homes).  
  • Trends in total household debt - Annual Growth rates of Total Household Debt:  1981-1990 10%, 1991-2000 6.0%, 2001-2010 9.4%. 
  • Household debt loads are considered to be currently manageable because of low interest rates, rising household income and net worth, and innovative financial products allowing for lower monthly payments.


Housing Markets and Demographics

  • Sales to listing ratio at the end of 2010 was 52.3% indicating a balanced market
  • The national apartment vacancy rate for major urban centers moved down to 2.9%
  • Economic recovery continued throughout 2010.  The real disposable income indicator (disposable income/consumption deflator) rose to 126 from a low of 75.  (This indicator had peaked in 2006 at 200). 
  • Canada’s Population grew faster over the past 3 years than in any other time since the early 1990’s
  • Saskatoon led CMA population growth from 2008 -2010 followed by Vancouver, Calgary, Regina, and Toronto and Edmonton.  Notably Kelowna also experienced high levels of immigration.
  • New immigrants tend to spend higher fractions of their incomes on shelter, with the number of new immigrants landing in Canada in 2010 reaching 271,000
  • Canada’s population of 65 and over will more than double by 2036.
  • One person households will become the largest type of household by the 2020s accounting for 28% of all households.
  • Average prices in 2010:  Vancouver $675K, Toronto $432K, Calgary $398K, Canada $339K, Montreal $297K, Saskatoon $296K.
  • Average monthly  rents in 2010:  Iqaluit $2265, Vancouver $1,185, Toronto $1,123, Calgary $1,069, Montreal $700,  Saskatoon $934


Credit Markets:


In February 2010 the Government of Canada announced changes to the standards governing mortgage back insured mortgages, which represented a tightening of credit standards.  These included higher qualifying interest rates, lower equity withdrawal limits, and larger down payment requirements for rental properties.

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