eee Ee, i ar i he a ae I rs Madge NS ee ee ' : 4 i 7 : ‘ , 4 ; : : 3 i d : } :, ( p : a d " Si p But B. C. | “expects to see ‘positive growth’ The Jatest estimate on housing. starts. for 1980 in- dicates a drop ftom 169,000 units predicted in March to 160,000, with next year expected to. produce a recovery to more than 200, 000 new starts. The forecast was issued June 11Lby the Economic Re- search. Committee of the Housing: and “Urban Deve- lopment . Association of Canada following a meeting in Ottawa held in con- junction with meetings of the Executive. Board and other: National. Committees and Councils. HUDAC President George Frieser released the revised - figures at a news conference “which was also attended by ERC chairman Mac Campbell and Reg POE SEE ea, e' ! te yd eo nr ; a Ryan, President and Chief Executive Officer, Mortgage Insurance Company of Canada. Frieser said that a province by province survey of housing markets shown in the report revealed the sharpest decrease would be in Manitoba — from 5,800 last year to a projected 2,500 starts this year. Comparable Ontario starts are expected to drop from 57,000 to 42,000 in Quebec from 42,000 to 35,400 and from: 40,000 down to 32,500 in Alberta. _ The only provinces ex- pected to show positive growth in 1980 are New- foundland, up from 3,000 to 3,800 and British Columbia, increasing from 27,500 to 30,000 starts. Frieser said that among the factors that may result in an increase in starts toward the end of 1980 and into 1981 are the latent demand for housing which has existed for some time, a reduction of housing inventory across the country, low apartment vacancy rates and improve- ment in consumer con- fidence. Mortgage interest rates are expected to remain relatively stable in the 12'4 to 13 per cent range for the next quarter and probably for the balance of the year, Frieser said. Meanwhile, the current supply of mortgage funds appears to be adequate for anticipated demand in the near term. indicators improved The positive pointing to are of options in real estate deals Owner could lose money The Real Estate Council of British Columbia is still concerned that property owners may be harmed by entering into options for the sale of their property where only a token consideration, as little as $1.00, is given. The Council's concern, which was originally drawn to public . attention last August, is that the practice can cause the owner to lose considerable amounts of money in a rapidly rising real estate market, which again appears to be prevailing. The option effectively takes the property off the market for the duration of the option. "We hear of situations where these options are currently being sought for as much as six months,” a Council spokesman noted “The practice appears to be growing in popularity,” he added, which is why the council feels that the hazards of the practice should be drawn to public attention, After last year’s warning was issued, the Council canceled the licence of one real estate firm which had, among other failings, been engaging in the practice extensively. “Increases of five to ten per cent in real estate pnces over short penods of time are not uncommoninBC at present,” the Council spokesman said. and cx- pressed the opinion that “Those conditions make the option highly favourable to the buyer whose interest is to lic up the property in order to then make a gale to a third party at a higher price with the difference being pocketed by the 1in- termediary holding the option and not by the owner ” With an option in existence, the owner is forced to sell on demand so that Chere are three senous disadvantages to the owner in the option system under "rising market conditions. The real points out Estate council that an owner offering to sell property privately can take his property off the market at any time If a_ listing agreement has been entered into with a real estate agent, the owner may still refuse to sell even at the listed price. although he would then be hable to pay the agent a commussion (An offer below the hsted price can, of course, be refused without any hability ) With an option in existence, he must scll, and at the option price. The Council also noted that persons endeavouring to assemble land = parcels frequently use an option system as a_ legitimate practice, although in those circumstances owners normally obtain a reasonable financial consideration = for granting the option. Owners should of course, satisfy themselves that the price under the option” reflects good market valuc consumer confidence in the economy include the demand for mortgage financing, increased traffic at model homes and stabi- lization of interest rates both in Canada and the United States, according to the ERC report. The housing sector itself is also gearing up to meet new demands in both traditional and new housing markets and to respond to opportuni- ties in renovation and re- habilitation::;which show a potential 1980 market in the $1-2 billion range. Frieser said in the press release that HUDAC is concerned that the current Mortgage fee HHLONORTIESHORI a Home? LEGAL SERVICES Phone for a free estimate of fees downturn in homebuilding activity, which could result in an exodus of building firms and _ skilled trades people, will affect the in- dustry’s capacity to respond quickly and_ efficiently enough to the increased demand for housing when economic growth improves in the next few years. 986-6222 He indicated this would lead to severe upward pressure on the price of homes, and emphasized thaf with interest rates reduced to a more affordable level, “right now is an excep- tionally good time to buy a home before the rates rise again and_= shortages of housing occur.” J,