Monday, January 20, 2020

Housing starts in Canada slowed in December, Canadian real estate group says


OTTAWA -- Developers started building fewer homes than expected in December, mostly because of a decline in multi-unit projects, Canada's housing agency said Thursday.

Canada Mortgage and Housing Corp. said the seasonally adjusted annual rate of housing starts came in at 197,329 in December, down from 204,320 in November.

Analysts on average had expected an annual rate of 210,000 for December, according to financial markets data firm Refinitiv.

Bob Dugan, CMHC's chief economist, said multi-family starts in Toronto, Montreal and Ottawa were the main drags on starts, but stable activity in Vancouver and significant growth in Calgary helped offset those declines.

Starts in multi-unit dwellings in urban areas fell five per cent from November, including a 17 per cent decline in Ontario, while urban starts of single-detached homes edged up one per cent.

The six-month moving average of the overall monthly seasonally adjusted rate was 212,160 units in December, down from 219,921 in November.

"Housing starts lost a bit of steam toward the end of last year," said RBC senior economist Josh Nye in a note.

The annualized pace for the fourth quarter as a whole came in at 201,000, compared with 220,000 in the prior two quarters, he noted.

But Nye said starts should be in the middle of the range for the year ahead as the market rebounds, helped in part by Canada's fastest population growth rate since the early 1990s.

"That would be consistent with a resurgent housing market - which we see extending into this year - and strong demographics."

CIBC senior economist Andrew Grantham said the slowing starts in the fourth quarter contributed to a deceleration in overall economic growth, but that starts should clock in slightly above the 200,000 mark this year.

"We expect that the combination of lower mortgage rates (compared to the start of last year) and solid population growth will support demand for housing in 2020," he said in a note.

TD economist Rishi Sondhi said the drop in multi-unit starts was likely from past declines in pre-construction condo sales. Sondhi said the effects of past pre-construction sales declines would continue to restrain homebuilding in key markets this year.

This report by The Canadian Press was first published Jan. 9, 2020.

Housing construction reaches new peak


There were 274,829 housing units in construction across the country in the last quarter of 2019, a record that has never been witnessed by Canada, a market watcher said.

The number of homes under construction in Q4 2019 was up by 2.82% on a quarterly basis and 7.4% on an annual basis, according to the Canada Mortgage and Housing Corporation (CMHC). This created another peak for housing construction, which was a little over 30% higher than any previous peak.

Ontario accounted for the biggest portion of homes under construction. Of the total homes currently being built during the quarter, 118,576 were from the province.

"Units under construction are up a whopping 8.77% from the same quarter a year before. The previous peak for housing under construction was all the way back in 1973," said Daniel Wong, a market watcher at Better Dwelling.

British Columbia also represented a significant portion of housing construction for the quarter. The province recorded 65,941 housing construction, up 2.39% from the previous quarter and 8% from a year before. This new peak is almost 50% higher than any other previous records witnessed by the province.

Wong said Canada is witnessing skyrocketing construction levels due to the recent housing boom.

"Most of this supply won't be hitting the market in the near term, but when it does, it's going to relieve a lot of pressure for prices to move higher," he said.

Friday, January 3, 2020

Flat year on horizon for Greater Victoria real estate


After a flat sales year in 2019, the Greater Victoria Real Estate Board is expecting another without shocks, surprises, slumps or super-charged growth.

“I suspect it will be more of the same,” said incoming Victoria Real Estate Board president David Langlois. “There are no shocks we can see with respect to interest rates or any large world events, though obviously we can’t predict those things, but in terms of the cycle, we are right on track.

“We typically go through a period of frenetic activity and price raises, then a relatively long, flat period when not a lot happens.”

According to several real estate veterans, the frenetic periods of activity and price increases tend to last two or three years, while the plateau periods can last seven or eight years.

That’s where 2020 finds itself — in the midst of what many believe could be another long, flat period. According to market figures released by the board Thursday, the region is coming off a year that boasted 7,255 sold properties, a 1.47 per cent increase from the 7,150 sold in 2018. The 10-year average for property sales is 7,413.

By comparison, the busy year of 2016 saw 10,622 sales, and another 8,944 in 2017 before things started to slow down again in 2018.

Langlois said the board saw its benchmark home-price index peak in the summer of 2018 to about $900,000, since then it has moderated a little, “but not much.”

“[2020] will be an uneventful, unexciting, normal year from what we can tell,” he said, adding last year there were few appreciable gains other than condo prices in the core areas and the single-family homes at the lower end of the market.

Langlois said he expects to see the higher end of the market continue to be soft, with the bulk of activity reserved for the lower end and entry level, a result of the federal government’s mortgage stress-test rules.

In all, he expects it will be a relatively balanced market.

“The market is steady,” Langlois said. That was the case as 2019 came to a close.

Last month, the board reported 402 properties sold with sales of condominiums up 17.5 per cent to 121 sold, compared with December 2018. Single-family home sales increased 13.8 per cent to 198 at the same time.

The benchmark price of a single-family home in the Victoria core in December was $855,000, down from $860,400 a year earlier. The benchmark price for a condo last month was $520,700, up from $503,000 a year ago.

Outgoing president Cheryl Woolley said 2019 was “active, slow to grow and low in supply.”

“Last year, we saw many prospective buyers sit on the sidelines waiting for inventory to be added. As a result of this unmet demand, there was and continues to be a push from consumers to create townhomes and condos at accessible price points,” she said.

In a year-end statement, Woolley reflected they had started the year by looking at measures taken by the federal and provincial governments to cool off a housing market that had already started to slow down after 2016-17.

She said tighter mortgage lending rules lowered consumer borrowing power and pushed more buyers into the mid- and lower-priced property market. The result was pressure on pricing.

“Although we did not see huge price increases though 2019 like we did in the run up through 2016, we do see buyers entering into multiple offer situations and competing for properties,” she said.

The real estate market on the rest of Vancouver Island slowed down in 2019, as the Vancouver Island Real Estate Board reported total sales of single-family homes fell nine per cent to 4,119.

The average selling price, however, did jump five per cent to $535,577 last year, up from $511,839.

B.C. government sets a lower home value for those claiming a tax grant


VICTORIA -- The threshold is being lowered for homeowners who qualify for a grant to help offset property taxes in British Columbia.
The provincial government says a decline in housing prices is behind the decision to lower the property value threshold to qualify for the full grant.
The threshold for 2020 is set at $1.525 million, down from $1.65 million in 2019.
The Finance Ministry says 92 per cent of homeowners will be eligible for the full $570 grant in 2020, the same as last year.
BC Assessment said Thursday there was an 11 per cent annual decline in the typical value of single-family homes in Vancouver, with the average assessment standing at $1.57 million as of July 1, 2019.
Residents whose homes are over the $1.525 million threshold are still able to claim some of the grant, which is reduced by $5 for every $1,000 of assessed value above the threshold.
Those 65 and older who are living in their homes in northern and rural areas can claim as much as $1,045 off their annual tax bill under the grant program.
Homeowners may also be eligible for property tax deferment if they are 55 years or older or are financially supporting a dependent child.

Thursday, January 2, 2020

Greater Victoria home values mostly dip slightly or stay same in latest assessment


Most of Greater Victoria’s 13 municipalities saw the typical assessed value of single-family homes either drop or stay the same as last year, according to information released Thursday by B.C. Assessment.

The 2020 property assessment roll details the assessed values of about 374,600 properties on the Island and more than two million provincewide.

It shows the residential property values for a typical single-family home dropped by as much as six per cent in Oak Bay, while homes in Highlands and Central Saanich saw no change.

Only Langford, Sooke and View Royal saw increases in the typical assessment. All other municipalities saw values drop.

That should come as no surprise to property owners after B.C. Assessment warned last month values could drop by as much as 10 per cent in some areas of Greater Victoria due to a softening of the real estate market.

The Crown agency said some single-family homeowners could see increases of as much as five per cent.

“The market has stabilized in most areas of Vancouver Island this year. In the south part of Vancouver Island the majority of residential property values are moving [between minus five per cent and plus five per cent], while up Island the value increases are a little higher,” said assessor Tina Ireland. “The commercial and industrial markets are generally showing increases over last year.”

The west coast of the Island saw the largest increase this year, with Tofino seeing a 15 per cent increase in the assessment of a typical single-family home to $883,500 and Ucluelet seeing an 11 per cent increase to $445,000.

In Greater Victoria the greatest increase in assessed value was three per cent in Sooke where the typical home was valued at $517,000 as of July 1. Oak Bay saw the greatest decrease, six per cent, to $1.14 million.

The most highly assessed property in the region was once again James Island, at $56.47 million as of July 1, 2019. In the previous assessment, the island was valued at $56.76 million.

The most valuable single-family home is once again 3160 Humber Rd. in Oak Bay, assessed at $15.2 million, versus $16.16 million a year earlier.

The most valuable commercial property on the Island is Mayfair shopping centre which is valued at $306 million, while Hillside Centre ranks second at $270 million.

Catalyst’s Crofton paper mill, assessed at $133 million, is the most valuable industrial property on the Island followed by Victoria International Airport at $131 million.

Assessment notices will start to appear in mailboxes this week, and are available online now at bcassessment.ca.

The assessment is an estimate of a property’s market value as of July 1, 2019 and physical condition as of Oct. 31, 2019.

According to B.C. Assessment, changes in property value reflect movement in the market and can vary greatly from property to property.

Assessors take into account current sales in an area as well as the size, age, quality, condition, view and location of a property.

The entire Island roll increased in value this year to $255 billion from $246.9 billion in 2019. About $4.14 billion of the Island’s assessments reflect new construction, subdivisions and rezoning of properties.

The total value of real estate in B.C. — there were 2,091,135 properties on this year’s roll — is over $1.94 trillion, a decrease of 2.5 per cent from last year.

B.C. Assessment said 98 per cent of property owners accept their assessment without an independent review.

Ireland said the rate of assessment appeals has remained steady at below two per cent over the past 10 to 15 years, regardless of market activity.

“Property owners can find a lot of valuable information on our website including answers to many assessment-related questions, but those who feel that their property assessment does not reflect market value as of July 1, 2019, or see incorrect information on their notice, should contact B.C. Assessment as indicated on their notice as soon as possible in January,” Ireland said.

Property owners may submit a notice of complaint by Jan. 31 to ask for an independent review by a property assessment review panel.

The panels, appointed annually by the Ministry of Municipal Affairs and Housing, typically meet between Feb. 1 and March 15 to hear complaints.

Increases in assessments do not necessarily mean an increase in property taxes, Ireland said.

“How your assessment changes relative to the average change in your community is what may affect your property taxes,” she said.

B.C. Assessment can be reached at 1-866-825-8322. Information is also available online at bcassessment.ca.

aduffy@timescolonist.com

Saturday, December 28, 2019

B.C. real estate outlook 2020: a forecast summary



Looking back to last year’s round-up of B.C. housing market forecasts, on the whole, the pundits had it not far off. Many predicted that sales in 2019 would rebound after a soft 2018. And they were partially right, although it ended up happening too late in the year for the full-year total to be described as a recovery.

So what are the various real estate industry organizations and brokerages predicting for B.C.’s residential sales and prices in the coming year?

We compiled this summary of some of the key 2020 forecasts, and took our best stab at a general consensus.

Sales activity

Prone to bullishness about the B.C. housing market by nature, the B.C. Real Estate Association (BCREA) predicts that MLS residential sales across the province will increase 10.9 per cent to 85,500 units in 2020, which would take the annual total to just below the 10-year annual average of 85,800 units. However, it’s worth noting that BCREA’s forecast a year ago that sales would rise 5.2 per cent in 2019 did not come to pass.

What’s also worth bearing in mind is that BCREA’s predicted sales increase is for all of B.C. and flattens out the widely varying predictions across different regions. Most of the recovery in activity is forecast to be driven by rising sales in Greater Vancouver and the Fraser Valley, where the markets were hit hardest by the recent slowdown. Greater Vancouver residential transactions are predicted to increase by 18.2 per cent in 2020, compared with 2019, and Fraser Valley sales are forecast to go up 12.4 per cent next year. In comparison, Victoria’s resale transactions are expected to rise a more modest four per cent in 2020.


Central 1 Credit Union, which tends to forecast with more measured caution, is surprisingly even more optimistic about B.C. home sales in 2020. It predicts that the higher demand seen in the market this summer and fall will mean home sales across the province will rise 12.9 per cent in 2020 — a generous upward revision from its previous forecast of 8.8 per cent.

Brokerage Royal LePage agrees that this demand, particularly in the Greater Vancouver market, will be sustained in 2020. “Sales have picked up significantly this fall and there is momentum in our market. Buyers who took a ‘wait and see’ approach over the past 18 months are returning to the market looking to buy, confident that price drops have levelled off and may start to escalate,” said Randy Ryalls, managing broker of Royal LePage Sterling Realty, in the brokerage’s 2020 forecast.

Canada Mortgage and Housing Corp. (CMHC) makes the vote for considerably higher Greater Vancouver sales in 2020 unanimous. The federal housing agency, which breaks down its forecast by census metropolitan area rather than province, predicts that Vancouver CMA will likely recover the home sales lost in 2019 and return, in 2020, to approximately the “normalized” levels of activity seen in 2018. Victoria CMA will see sales level off in 2020 and 2021, said CMHC.

General consensus: The forecast is pretty much unwavering among the various pundits. B.C.’s housing market activity will strengthen on the whole, but most of the recovery will be in the Lower Mainland, where the market had previously been hardest hit.

Home price changes
In another show of bullishness, Central 1 Credit Union is confident that B.C.’s median sale price across the whole year will break new records in 2020, and again in 2021. After the downward blip seen in 2019, in which the median full-year price is expected to have fallen 2.4 per cent to $522,000, the credit union is forecasting a rise of 3.8 per cent to a new all-time provincial record of $542,000 in 2020.


BCREA predicted a similar whole-province average price rise, at 3.6 per cent in 2020. However, it seems the larger increase in predicted sales in the Lower Mainland doesn’t translate to larger increases in predicted home prices. According to BCREA, Greater Vancouver and the Fraser Valley are both expected to see an average MLS sale price rise of just one per cent in 2020. The association’s highest forecast for an average sale price increase is in the B.C. Northern region, where prices are expected to jump 8.1 per cent in 2020.

RoyalLePage mirrored this forecast for Greater Vancouver. It said in its most recent outlook: “In Greater Vancouver, house price appreciation is expected to stabilize in 2020 after declining in 2019. The aggregate price of a home in the region is forecast to rise 1.5 per cent to $1,125,200. Overall, British Columbia’s outlook is positive.”

RoyalLePage’s Ryalls added, “The concern for potential buyers may be that prices will escalate quickly but they should also be concerned that they won’t get the same selection of listings or time to look around. It varies between neighbourhoods, but areas such as East Vancouver are a seller’s market.”

Re/Max didn’t offer a whole-province prediction, but its area-focused forecast was something of an outlier, pegging Vancouver East and Vancouver West as seeing considerably higher price growth next year, at eight per cent and four per cent respectively. It said that Kelowna would see the province’s least amount of price growth, with prices flat to 2019, while Victoria would see a three per cent price uptick.

CMHC thinks that any Vancouver-area price growth will remain muted, but its forecast range predicts that a slight rise is more likely than a slight decline. Victoria’s home prices in 2020 are likely to remain flat with 2019 before rising slightly in 2021, according to the federal housing agency.

General consensus: This one is slightly more varied than the sales forecast, but it averages out to a sense of cautious optimism. Which is to say that B.C.’s average home prices will likely rise a few per cent next year, but Greater Vancouver and Victoria’s price trends will lag somewhat, with modest-to-zero increases and probably no loss of value.

Wednesday, December 25, 2019

Displaced tower residents to get more money for expenses: mayor


Renters who have left the Danbrook One building in Langford due to safety concerns are receiving an additional $150 for expenses, said Mayor Stew Young.

About 60 per cent of the 86 units that had been occupied in the 2766 Claude Rd. building have seen tenants move out after the city warned them Dec. 20 of structural safety issues in the new building. The building has a total of 90 units.

Langford staff and volunteers have pitched in to assist renters, using a $400,000 fund to pay for hotels and essentials. As well, a fundraising page for tenants has topped $32,000, with several developers chipping in.

“The community was really good,” Young said.

Residents of vacated units received $250 vouchers a few days ago. Young said that another $150 per unit was to be distributed Tuesday.

Langford is concentrating on helping residents up to Jan. 3, two weeks from when tenants were notified of issues, he said. Insurance coverage for renters would typically cover that period of time, he said.

If it gets to the point where Langford is running short of money, then Young hopes the province will step in.

Langford is hoping to recoup monies it has given to help renters and will be speaking to its insurance company, he said.

A special command response centre at 780 Goldstream Ave. set up to help tenants by finding hotel rooms and helping with moving was open Tuesday. It will not be staffed on Christmas Day but Langford remains ready to help citizens, who can contact the fire hall, Young said.

The building’s occupancy permit was revoked. It is not known how long it will take for repairs to be completed.

The 11-storey reinforced concrete building was constructed by Langford’s Design Build Services and is owned by Centurion Property Associates of Toronto. Company officials could not be reached on Tuesday.

As soon as two independent engineers from different firms sign off on remedial work, the city will approve a new occupancy permit, Young said.

The Association of Professional Engineers and Geoscientists notified Langford earlier this year about a complaint relating to the structural integrity of the building, the city said in a document posted on its website. Langford hired engineering firm WSP to examine structural documents for the building.

An overview of WSP findings, also posted on Langford’s website, said its “report highlights elements of the gravity system design that indicate a lower than code stipulated factor of safety and where the likely failure mechanism can occur with very little warning.” This report recommends immediate installation of temporary supports at level two.

Gravity load refers to the weight, including materials, people and their belongings, and elements such as snow, in a building's structure. A gravity system is the vertical loading support structure for a building, said Dr. Lina Zhou, an assistant professor in the department of civil engineering at UVic.

 spokeswoman for the Engineering and Geosciences organization, which is governed by B.C. legislation, said it was unable disclose more information about the building. “We are required by law to keep confidential any ongoing investigations and therefore I'm unable to share anything,” Megan Archibald said in an email. “When it comes to our investigation and discipline processes, our role as a regulator is to determine if a professional engineer or geoscientist has failed to meet the professional standards or ethical obligations of the professions. Our investigation will focus on whether those standards of practice were breached.”

cjwilson@timescolonist.com

Thursday, December 19, 2019

Six real estate trends to watch for in 2020



Thankfully, success in real estate doesn’t require an ability to predict the future. But having an idea where the market is heading is critical to making the right decisions.

PropertyGuys.com recently released a list of six trends that the company feels will have a lasting, potentially transformative effect on Canada’s real estate market in the coming years. Based on consultations with PropertyGuys’ network of agents, developers and customers in both Canada and the US, the trends presented paint a picture of a rapidly changing real estate environment where fulfilling tenant desires will require more of investors than simply adhering to the status quo.

PropertyGuys co-founder and lead analyst, Walter Melanson, says the trends identified suggest fundamental changes in the real estate market “that have us believing that this is more of what the future has to hold.”

Co-living
Before its catastrophic public flameout, We Work changed how the owners of commercial properties could exploit the sharing economy to drive rents for properties that were otherwise either vacant or failing to achieve the rent appreciation they needed to remain profitable.

Melanson says residential landlords are now considering using rental properties in the same way.

Most young city dwellers expect to have roommates anyway. By providing this new generation of renters what they’re looking for – furnished apartments, bigger shared spaces, free cleaning and wifi, and the company of likeminded people – landlords can charge premium per room rents. It’s like running a student rental, minus the holes kicked in the wall.

“The whole idea is that it builds community, it gives landlords a boost on rents that were going the wrong way for them, and it gives the people who rent the upside of having a way better place than they could ever afford on their own,” says Melanson.

Climate change impacting sales of new builds
As changing environmental standards force developers to alter how they build their properties, the cost of doing so will only increase over the short-term.

“We see this as one of the things that puts a lot of pressure on new development and new construction,” Melanson says. “The world’s becoming way more complex as it relates to building – getting permits, getting through the red tape. It changes so quickly, and it just gets harder and more expensive.”

Higher prices for new product could put a damper on sales of pre-construction properties, but the built-in appreciation associated with such assets should ensure that, by delivery date, an investor will have paid far less than the going rate.

New builds are old news
The increasing cost of new product and the built-out status of many urban communities has forced developers to move further and further away from city centres. Buyers still want new product, but the distances being placed between where they work and where they can afford to buy are becoming untenable. Melanson’s prediction is that buyers will see less value in new builds if it means being locked into an exurb lifestyle hours from where they actually want to live.

“What we’re seeing is people’s flight for affordability is pushing them as far as humanly possible from the city because there’s nowhere else to build,” he says.

That may be, but in Ontario and British Columbia, two provinces with surging populations, it’s safe to assume that there will always be someone willing to drive two hours to work if it means they can get a foot on the property ladder. And there is still plenty of room to build within minutes of most cities in Atlantic Canada.

Condos for families
Investors commonly think that the smallest property a family will be interested in renting is a townhouse. Melanson says that is no longer the case, and that new arrivals from overseas are frequently choosing condos as an affordable, convenient alternative to single-family properties.

“Newcomers don’t all have the same view as you and I on what a home’s supposed to be,” he explains. “We want all this space, and it doesn’t make sense for a lot of people moving from other parts of the world where they never had this space.”

Investors basing their choice between one- and two-bedroom units based on demand, take note.

Prices on the rise

Bad news for anyone hoping for a slowdown in the price increases affecting major markets like Montreal, Toronto, Vancouver and Victoria: increased demand will keep pushing home prices higher. The flatness in prices witnessed in Vancouver and Toronto over the first half of 2019 was a blip, a mirage. Investors looking for value will have to set their sights on less densely populated cities.

“Everyone in the world wants to live in Toronto, it would seem,” says Melanson. “And there’s nothing you or I could ever do to stop them. I don’t see anything in the foreseeable future that could change that fact.”

PropertyGuys also predicts noticeable price increases in Edmonton and Calgary. Based on recent government cuts and the headwinds that are still battering the province’s oil sector, CREW respectfully disagrees.

The move away from real estate agents
“Real estate is a hundred-year old business,” Melanson says. “The big brands trade the same way today they did almost a hundred years ago. The dynamics of their business being so agent-centric worked when the agent had the goods. They had the listing, they had the smarts, they had the data, and they had the secret data.”

Those days are over. With buyers growing more confident in the data they have access to, paying a realtor to provide similar, if not in identical, information will no longer be an automatic choice – particularly for new investors who may have never dealt with an agent before.

“You can learn more, do more, understand more and play the market a lot different than you would have 10 or 20 years ago when your reliance on a real estate agent was at its highest,” says Melanson.

CREW sees a day when buyers and sellers choose to market and list their own properties through an app rather than having to sit through a realtor’s sales pitch. But in our opinion, investors hoping to build a rock-solid, diversified portfolio are better off paying commissions to an investor-focused realtor than paying the higher long-term costs associated with choosing the wrong property. Working with an agent who is well versed in the legal, contractual and business side of real estate, will save you grief and headaches that seems to always be a challenge when dealing with this sector. The last thing you need is having the deal go side ways, for example, opening a contract with a change to possession date will give a buyer or seller an out. Real Estate is complicated, choose wisely when it comes to a realtor or lawyer.



Anaemic housing supply predicted in Canada








The sudden turnaround in sales activity during the latter part of the year will likely cause a supply shortage in Canada next year, according to the Canadian Real Estate Association (CREA).

National sales trends improved at a faster-than-expected pace over the second half of 2019 as new listings continued to deplete. "These trends have caused many housing markets to tighten, which has sharply lowered the national number of months of inventory," CREA said.

The balance between supply and demand hit its lowest since mid-2007 in November, resulting in increased competition among buyers. This provided a "fertile ground" for price gains, according to CREA.

The combined number of months of inventory in Canada, excluding the Prairies, and Newfoundland and Labrador, currently sits at a 15-year low and continues to fall.

"The number of homes available for sale in these provinces, which represent over 80% of national activity, is at a 15-year low. This is anticipated to support solid home price growth in 2020, particularly if current trends intensify," CREA said.

Given the limited supply, the national average sales price is expected to rise by 6.2% next year, led by projected gains in Ontario, Quebec, and the Maritimes.

On the other hand, prices in Alberta, Saskatchewan, and Newfoundland and Labrador are expected to decline slightly.

"In regions with supply shortages, price gains may exceed forecast levels should shortages become more acute than anticipated," CREA said.



Questions raised about structural safety of new Langford tower; tenants given option to move

Resident Bob Breuker in front of Danbrook One at 2766 Claude Rd. in Langford.
Photograph By DARREN STONE, TIMES COLONIST

Questions about the structural integrity of Langford’s tallest residential rental building prompted the city on Wednesday to offer temporary accommodation to all residents who feel unsafe.

The City of Langford has commissioned an independent review of the 11-storey concrete building called Danbrook One, at 2766 Claude Rd., in the city’s downtown. Of the 90 mostly one-and two-bedroom units in the building, 86 are occupied.

“If there’s a problem, then Langford will take the lead on it, and, fortunately, we are prepared for moving nobody or moving the whole building,” Langford Mayor Stew Young said on Wednesday evening. “I’m prepared for any action.”

Residents interviewed Wednesday were taking a wait-and-see approach.

City representatives were in the building’s lobby to inform residents about their accommodation options, which include free temporary hotel accommodation provided by the city, and assistance to move to alternative rentals. The city said it has identified a new rental property in the neighbourhood that’s ready for occupancy.

Bob Breuker, who has lived in the building since June, said he is staying put for now. “I think the report is coming out on Friday and I think I’ll wait until then because there’s a lot of stuff to do with moving out,” he said. “You’ve got to get a mover, which will be taken care of, apparently.

“I don’t think we should panic, we should see what’s going on.”

Micheline Saviskas, who also moved in in June, said she felt better about the situation after speaking to a Langford representative. “He’s reassured me that the city will be fully on their case to get whatever is the issue rectified, so that’s the main thing,” she said. “By finding this out, in a way it’s somewhat reassuring — stressful at the same time.

“But as long as things are dealt with properly and they make it safe, then we should be fine.”

Saviskas said she is staying put. “I don’t have the energy to move again.”

The building was completed this year, built over 18 months by Design Build Services, which has many projects in the city. The building is owned by Centurion Property Associates.

The Engineering and Geoscientists of B.C. first told the city in April that it had received a professional conduct complaint regarding the project.

The city initiated a third-party probe after it was notified Dec. 3 by the association that an internal review related to the building’s “structural design and as-built structure” revealed sufficient evidence to launch a formal probe through an Engineering and Geoscientists of B.C. investigation committee.

“The concerns raised and reviewed internally by the EGBC bring into question whether the building’s structural design and as-built structure meet engineering requirements and whether the building’s structural design and its as-built structure are sufficient to mitigate risks to health and safety,” said the city in a statement.

It might boil down to a disagreement between two engineers, said Young. If, for instance, changes were made during the building’s construction, those might have to be reviewed, he said. “There may be no issue here if the engineer who signed off provides all the drawings.” Conversely, “that’s our first concrete building and, if an engineer made a mistake, they have to fix it.”

Preliminary results from a third-party report commissioned by the city have given it reason to heed the Engineering and Geoscientists of B.C.’s initial concern, the city said, but the investigation is not expected to be completed for another few days. The city said it does not yet know the magnitude of the problems.

“I’m prepared for the best- and the worst-case scenario,” said Young. “Whatever happens, we will find a solution and we’re not going to put our head in the sand. We will own it. We will deal with it. We will fix it. And we will make sure that the residents there are not put out.”

The best-case scenario is the building is deemed by engineers to be structurally sound or as needing minor structural fixes that can be made without tenants having to move out.

The worst-case scenario is that it is at risk of falling over or collapsing in an earthquake.

City councillors voted Tuesday night to move immediately to accommodate residents who choose to move.

Young said he didn’t sleep Tuesday night.

“I’ve been working on it since last night and I said: ‘OK just notify the people, we can’t wait for the report to come in,’ ” said Young.

“We have enough buildings in Langford. We can move that whole building if we have to.”

Langford is known for the rapid pace of its development, but Young said that growth rate is due to zoning, and the structure of buildings is the domain of engineers, not the city. The building was signed off by an engineer when it was completed.

The city said under its legal regulatory framework — the same for all municipalities in the province — “our staff rely upon the project engineer’s professional stamp of approval, which affirms that their engineering designs as presented and executed abide by all of the requirements under the Engineers and Geoscientist Act.”

The city said it has a “legal and moral obligation” to notify all concerned and offer alternate accommodation for those who wish to leave the building until the final reports are in.

Building owner Centurion Property Associates is co-operating with the city and through its building manager will assist tenants who wish to relocate.

Centurion, which owns six rental buildings in the capital region, including four in Langford, will assist residents who choose to relocate. The city said it will also assist with moving expenses when co-ordinated with city-designated movers.

Matthew McKay, co-owner and development manager with Design Build Services, could not be immediately reached for comment on Wednesday evening.

The city said Design Build Services’ other construction projects in the city are wood-frame and have no relation to the current investigation.

City staff were stationed in the lobby of Danbrook One from 2 p.m. to 9 p.m. Wednesday and will be on site 7 a.m. to 9 p.m. today and possibly more days this week.

“I want people to know Langford is there,” said Young.

City staff are also available by email at danbrookone@langford.ca and by phone: 250-857-0314.

ceharnett@timescolonist.com

jwbell@timescolonist.com