Five examples of Canada’s dysfunctional housing market and the Home of the Week: Canadian real estate news for July 5

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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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New 30-year mortgages are coming, but the devil’s in the details

Starting Aug. 1, Canadian first-time homebuyers purchasing a newly built home with a down payment smaller than 20 per cent will be able to opt in to an insured 30-year amortization period – up from a 25-year maximum. But the strict eligibility requirements have cast doubts on the true benefit of the new policy for housing affordability, writes Mariya Postelnyak. Mortgage brokers say the criteria to qualify will exclude many Canadians trying to access the resale market and limit buyers to the condo market — the rules are exclusively for buyers of new builds under $1-million, which are increasingly scarce as home prices increase.

Inside the crisis facing Canada’s dysfunctional housing market

From any angle, Canada’s housing market is badly broken. The promise of home ownership, long the ultimate expression that one had secured a spot in the Canadian middle class, has faded away, not just in the usual suspect cities for real estate exuberance – Toronto and Vancouver – but in towns and communities across the country. Reporters Jason Kirby, Matt Lundy, Shane Dingman and Frances Bula found that despite the many efforts and policy pledges aimed at bringing sanity back to Canada’s housing market, absurdities abound that reflect deeper, more intractable problems.

Families are being squeezed out of their cities and forced to move further away, outdated zoning rules in Vancouver will see an aging apartment building replaced with high-priced detached homes, the University of Guelph is struggling to solve its student-housing debacle after admitting far more first-year students than its residences can accommodate and the country’s rental vacancy rate is quickly shrinking. Solutions exist, but as each of these scenes from Canada’s housing crisis shows, none are easy or quick, meaning relief is likely a long way off.

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Toronto home sales rise but ‘emboldened’ buyers take their time, report says

Toronto home sales rose 4.2 per cent in June after four straight months of declines, but activity was relatively slow as new home listings surged and would-be buyers became emboldened with the growing abundance of options, writes Rachelle Younglai. More buyers had been expected to enter the market after the early June interest-rate cut, but as homeowners continue to put their properties up for sale, prospective buyers feel no rush to buy right now. Even if the central bank cuts the rate again at the end of July, realtors are not sure that will motivate buyers given the amount of inventory available.

Opinion: Clever planning can make a cottage transfer tax-smart

As some cottage owners raced to sell off their lakeside home before changes to the capital gains tax took effect last month, others were more interested in transferring ownership of the property to their children. But there can be a number of tax issues related to a transfer, and smart structuring is key, writes Tim Cestnick. Accepting less than market value for the property could leave your kids with a hefty capital gains tax. But selling the cottage for its full value, and then forgiving the debt on your death — with no negative tax consequences — can make for a smoother transition.

Home of the week: Fond memories at the former home of Four Seasons founder Isadore Sharp

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36 Green Valley Rd., Toronto – Full gallery here

The sprawling five-bedroom Toronto bungalow was originally built by Isadore Sharp, the founder of the Canadian luxury hotel brand Four Seasons, and the hotelier’s influence remains. With the work of architect Peter Dickinson and Mr. Sharp’s wife, Rosalie Wise Sharp, influences from the Four Seasons are preserved in the form of stone walls, cedar beams and walls of glass. A double-sided stone fireplace divide the living area from the dining room, which also has a wall of glass providing a view of the greenery outside. The house is sheltered by a treed slope at the rear and surrounded by a large lot, with an in-ground pool put in by former owners but no longer used.