The bike path that the city intends to create on Cote Ste Catherine will be dangerous to cyclists, drivers and pedestrians. While the idea of creating a bike path on Cote Ste Catherine may have some merit, and will certainly have supporters, the city must adjust it’s plan for the path, to make the path more useful for cyclists while allowing the street to be friendly to cars and pedestrians as well.

As it stands, Cote Ste Catherine has 4 lanes of car traffic (2 in either direction), plus 2 lanes for parking (1 on either direction).  The city is planning to remove both lanes of parking in order to make space for the bike path as well as install a large concrete divider separating the path from the road. On the north side of the street, parking will only be permitted at off rush hour times. On the south side of the street the parking will be completely removed. Cars traveling eastbound will in effect be driving right up against the bike path, while cars, buses and trucks traveling westbound will be driving within inches of pedestrians on the sidewalk. This is a ridiculous plan.

As with the carelessly constructed de Maisonneuve bike path, the wide concrete divider will be a complete waste of resources. The city contends that this divider is however needed so that the cyclists on the path have enough clearance from the side mirros of vehicles traveling beside them.

However, on the other side of the bike path, pedestrians will have cars zooming within inches of their bodies. Since Cote Ste Catherine also has bus service, the pedestrians on the sidewalk will also face the dangerous and now famously deadly side view mirrors on the STM buses. The killer bus mirrors will come within inches of pedestrians walking on the sidewalk, and will make the sidewalk all but unusable.

The concept for this bike path was not thought out properly, and together we must force the city to adjust its design.

Cyclists, myself included, tend to stay clear of Cote Ste Catherine due to the vehicular traffic. But, with the abundance of quiet residential streets in the area, this is fine. I never complained, and I have never heard any other cyclist complain about the situation. We simply ride or bikes on other streets.

In my opinion, the bike path on Cote Ste Catherine is not needed, since many cyclists can, and do, simply use other streets in the area.

On a seasonally adjusted basis, dollar volume was valued at $36.0 billion in the second quarter, down 3.1% quarter-over-quarter, CREA reported. This was the fourth quarterly decline since dollar volume peaked one year ago. In June, the seasonally adjusted dollar value of MLS sales edged 0.2% higher on a month-over-month basis to $12.0 billion.

For the January-June period, the MLS residential average price rose 3.6% year-over-year to $313,610. On a quarterly basis, the average price was $315,760 in the second quarter, up 1.8% from the second quarter of 2007. In June, the national average price held steady on a year-over-year basis at $314,028.

New listings continued to outpace sales in the first half of 2008, hitting a record 518,270 units in the first six months of the year, up 9.6% from the previous record set in the same period last year. This is the first time in any six-month period that new listings topped half a million units, CREA reported.

For the fourth time in four months, seasonally adjusted new MLS residential listings topped 75,000 units in June 2008.

By Geoff Matthews, gmatthews@economicnews.ca, edited by Sarah Sussman, ssussman@economicnews.ca

CEP Newswires – CEP News ? 2008. All Rights Reserved. www.economicnews.ca

The Copying, Broadcast, Republication or Redistribution of CEP News Content is Expressly Prohibited Without the Prior Written Consent of CEP News.

New condos are still shooting up to crowd the Toronto skyline, but behind the scenes the condo boom times are ending, a new report predicts.

“We’re expecting a slowdown in 2009,” said Jane Renwick, editor and vice-president of Urbanation, a condominium market research company.

“So we would say that we were at 22,000 [condo] sales at the end of 2007. We’re predicting 16,000 sales to round out this year. And we’re expecting sales to dip beyond that in 2009.”

Urbanation released a report yesterday about the Toronto condo market’s second quarter of 2008.

Following record condo sales in 2007, she said, the market is now back to 2005 and 2006 levels.

Currently, she said, the market appears “more normal and predictable,” with sales volumes returning to earlier levels and prices climbing slightly.

But economic woes in the United States, a high dollar and a loss of manufacturing jobs, she said, are pointing toward a recession and a condo market contraction.

“We’re not predicting a crash by any means,” she said. “I would say that we’ll have a correction in terms of sales volume, but I don’t think we’ll have the same correction in terms of price.”

The good news, she said, is that this contraction shouldn’t be on the level of the condo market crash of 1989 to 1991.

Starting in 1986, she said, prices started increasing by 6 and 7%, quarter over quarter. In 1987, the price increases exceeded 20%, year over year.

At the end of 1988, condos were selling for 39% more than the year before. And in 1989, there were a couple of quarters with 40% price increases, year over year.

“Those things say a correction is inevitable — it’s price inflation,” she said.

And the result, she said, was that in 1991 and 1992, condo pricing dropped by 17%, 16% and 15% year over year.

But this time, she said, the price increases are more modest.

In 2007, she said, price inflation was between 10 and 12%, year over year, relative to the year prior; now it’s at 8%.

“There was some price inflation last year which always happens in a heated market, but it didn’t get out of control to the point where it was requiring a correction to bring it back down in line with value,” she said.

The number of condos being built, she said, are likely to decline from both a rise in construction costs and a credit crunch in the banking sector, which is making it tricky for less-established developers to find financing.

“So ABC developer launches a building, thinking everything is fine with what they consider the historic pre-sale requirements in order for the financing to kick in,” she said, “and the banks are saying we actually don’t have an appetite for this because we can’t.”

Even if supply diminishes, she said, Urbanation predicts that prices will flatten out as opposed to rising.

“We’re also saying that the demand will wane — hopefully those two things happen in unison and create some kind of balance,” she said.

Maureen O’Neill, the president of the Toronto Real Estate Board, said that the advantage to the current softening real estate market is its stability.

“Because it’s declining, it’s correcting, it’s balancing to make it a lot more stable,” she said. “At least now we know what we’re looking at.”

Photo by Peter

Housing starts sank 13.6% in July to an annualized 186,500 units from a downwardly revised 215,900 in June (originally reported as 217,800). Expectations had been for a relatively modest 3.6% decline. However, the weakness was likely slightly overstated with the drop largely concentrated in Ontario, which contributed 30,300 units to the overall national decline in starts.

The drop in starts reflected weakness in both urban singles and multiple units, dropping 6.6% and 20.2%, respectively. The latter can be quite volatile month to month with the singles component historically more indicative of the underlying trend in the overall housing market. As well, the weakness was almost solely concentrated in Ontario, where starts dropped 38.8% to an annualized 47,800 in July from 78,100 in June. The Prairie region saw activity move lower as well, although by a relatively modest 1.6%. All other regions/provinces showed small increases.

Housing activity is definitely on a downward trend consistent with indications of deteriorating affordability through last year. This factor is expected to keep new residential construction activity under downward pressure going forward. Our forecast assumes that starts will drop on average 5.3% this year and 14.8% next year. (The level of 2007 starts was relatively unchanged compared to 2006.)

Forecast declines for this year and next represent a modest pace of slowing in contrast to the crash in activity in the United States, where starts fell 26% last year and are expected to decline another 30% this year before modestly recovering 5% in 2009. However, given the experience in the United States, the unexpected weakness in July housing markets will likely keep the Bank of Canada wary about ratcheting up the still relatively stimulative 3.00% overnight rate. We expect that downside risks to growth will result in the central bank maintaining rates at current levels through the remainder of this year.

U.S. markets to take cue from data this week
There are no U.S. economic reports today, but a reasonably busy economic calendar for the week as a whole. With second-quarter earnings reports largely (and thankfully) in the rear view mirror – 453 of the S&P500 companies have now reported – markets are now more likely to take direction from the combination of this week’s activity repots and from foreign exchange market developments after the U.S. dollar enjoyed its best weekly performance on a trade-weighted basis since the beginning of 2005 last week.

This week’s economic data will be largely unaffected by gas price movements (they were flat from June to July), the highlights being the trade balance on Tuesday, retail sales on Wednesday, inflation on Thursday and industrial production/capacity utilization on Friday. While these reports are not expected to be barn-burners (core retail sales expected up 0.5%, for example), negative growth surprises are coming more from abroad than in the United States at this stage and may keep the U.S. dollar supported.

As you can see from the above chart, the number of residential sales in 2008 has slowed dramatically. Sales were down 8% in January, down 7% in March, and down another 7% in May from the same periods in 2007. The other months only showed modest improvements over 2007, of about 3%. In total, year to date, sales are down 9% from 2007.

This data does not even include the current month of August which is on track to be the worst August sales month in years.

The fantastic Montreal real estate “money well” seems to finally have run dry!