August 2013 Canadian Economic Fundamentals

[Ally]

The end of Canada's housing boom?




A spate of fresh data and yet one more market-cooling tweak from the Canada Mortgage and Housing Corp. last week has put one of the most important sectors in the Canadian economy, and the most important asset-source for most Canadians, on a kind of death watch.




That's because while some of the data, such as home prices and starts, is pointing to the soothing "soft landing" that homeowners, economists, banks and politicians are fingers-crossed hoping for, others, like land purchases and building permits suggest the real message is: the crash is coming.





Read the full article here.

 

[Ally]

Canadians appear to be 'drunk on housing' and approaching hangover




OTTAWA - Canada's much-watched housing market is sending out mixed signals these days ` even for analysts.




A spate of fresh data and yet one more market-cooling tweak from Ottawa last week has put one of the most important sectors in the Canadian economy, and the most important asset-source for most Canadians, on a kind of death watch.





Read the full article here.

 

[Ally]

Francophone migration: leaving Quebec for jobs




MONTREAL ` In 2006, Xavier McGuire was fresh out of college, unsure about his job prospects and ready for a little adventure. With a friend, the young francophone from Amos hit the road in an old burgundy Toyota, Alberta bound.




Once there he soon found work as a welder`s helper on industrial sites. He had planned to stay only a short while before returning home. But McGuire, the son of a lawyer, made $80,000 in that first year and he`s never left Alberta.





Read the full article here.

 

[Ally]

Banks seen as capable of surviving housing crunch





OTTAWA ` The Fitch ratings service says it believes Canada`s big banks can likely withstand a moderate to severe housing downturn ` but they would feel the pinch.



The Chicago-based service says Canada`s biggest six banks ` TD, RBC, Bank of Montreal, CIBC, Scotiabank and National ` all have equity ratios well above what is required under the new Basel III requirements.




But the U.S.-based rating service says a housing crash in Canada would push down those ratios as the value of their mortgage assets plunge in relation to their considerable loan levels.





Read the full article here.

 

[Ally]

Canadian housing prices may be set to resume ascent




Canada`s housing market appears to taking off again after a `soft landing` that barely brushed the runway.




Recent data on housing starts and resale activity point to a market that doesn`t seem to be conforming to the soft-landing scenario the government and the Bank of Canada are trying to pilot it toward.





Read the full article here.

 

[Ally]

Will there be a housing bubble in Canada? Not likely

One day the economy is growing and thriving, the next day, the housing bubble is about to burst and the country is stagnating. This is the fickle nature of the media. Not only was this the news a few years ago, but gloomy economic news is still reported by the media today. It seems that every new research or opinion by a financial pundit gets press time.A closer look at the facts of what`s occurring in the economy tells a clear story. Just last week, Statistics Canada reported that the economy grew the fifth month in a row, as gross domestic product (GDP) was 1.6 per cent higher in May than the same month a year ago.

On the job front, Statistics Canada found that in May, the country had its best month for job creation in more than a decade, and remained steady in June.



Read the full article here.

 

[Ally]

Toronto, Hamilton lead real estate recovery






Canadian home resale prices increased in July, boosted by strong gains in Hamilton and Toronto.






According to the Teranet-National Bank Composite House Price Index, which is a weighted index of 11 cities across Canada, prices increased 1.9 per cent last month from a year earlier.






Read the full article here.

 

[Ally]

Home building will pick up next year, but not as much as expected




Canada`s housing agency pared its forecast for work on new dwellings next year.




The pace of housing starts will be 186,600 units in 2014, down from an earlier estimate of 188,900 units, Canada Mortgage & Housing Corp. said Thursday from Ottawa. The pace of starts this year was forecast to be 182,800 units, little changed from a June 25 estimate of 182,900.





Read the full article here.

 

[Ally]

Canadian home prices hit all-time high in July




Canadian home prices rose in July from June to an all-time high, but the modest monthly gain suggests the robust housing market may be cooling again, according to data from the Teranet-National Bank Composite House Price Index on Wednesday.




The index, which measures price changes for repeat sales of single-family homes, showed overall prices rose 0.7% in July from a month earlier, the fifth straight monthly gain but on the low side of typical summer housing strength.





Read the full article here.

 

[Ally]

CMHC may not like this housing recovery: BMO economist




OTTAWA ` The housing market may be recovering just a little too fast for CMHC, the federal Crown corporation that has a key role in shaping the market.




Doug Porter, chief economist with Bank of Montreal, wonders if housing statistics over the last couple of months showing sales and prices rebounding might have spooked the CMHC.





Read the full article here.

 

[Ally]

CMHC lowers 2014 housing construction estimate




OTTAWA` Canada Mortgage and Housing Corp. says the western provinces are helping stabilize construction activity and momentum will build into next year but 2014 housing starts aren't looking as positive as previously expected.





Read the full article here.

 

[Ally]

Quebec condo construction could see significant drop




MONTREAL ` Multi-unit residential construction ` primarily condos ` is expected to drop by almost 21 per cent this year in Quebec, as rising inventory and weaker-than-average July sales in Montreal contrasted with double-digit year over year gains for the month in hot markets like Toronto and Vancouver.




Starts in all housing categories are expected to decline almost 19 per cent in Quebec this year, before rebounding by 3.4 per cent to 39,800 units in 2014, the Canada Mortgage and Housing Corp. forecasted Thursday. Weaker Quebec demand for new homes this year follows slow economic growth, and rising inventory of condos for sale in areas like Montreal Island.





Read the full article here.

 

[Ally]

Strong housing sales in Vancouver and Toronto boost national housing market




OTTAWA ` Homes were selling at a brisk pace in Vancouver and Toronto last month, while the national average price continued to rise, suggesting Canada's real estate industry has returned to "average levels" after a decline that began last summer.




The Canadian Real Estate Association's report on activity for July showed resales edging up 0.2 per cent from June on a seasonally adjusted basis and up 9.4 per cent from July 2012, when tighter rules put the brakes on lenders and buyers.





Read the full article here.

 

[Ally]

Housing stats look 'average'




OTTAWA -- Homes were selling at a brisk pace in Vancouver and Toronto last month, while the national average price continued to rise, suggesting Canada's real estate industry has returned to "average levels" after a decline that began last summer.




The Canadian Real Estate Association's report on activity for July showed resales edging up 0.2 per cent from June on a seasonally adjusted basis and up 9.4 per cent from July 2012, when tighter rules put the brakes on lenders and buyers.





Read the full article here.

 

[Ally]

Flaherty cooled housing market without dousing it





When Finance Minister Jim Flaherty tightened up Canadian mortgage rules last July, there was concern that his move would not only take the froth out of Canada`s housing market, it might cause a plunge in prices and sales. The market did slow, but the bounceback came quickly. Now, just a year later, there is a remarkable vigour in residential real estate.






Read the full article here.

 

[Ally]

OK, what's really going on in the Canadian housing market?




Just wow.




Six hours before CREA posted its boring numbers, CBC news was pumping. `Canada`s realtors are expected to announce numbers today showing a booming market.`





Read the full article here.

 

[Ally]

The role of real estate in a balanced portfolio




So just how much real estate should average investors have if they hope to achieve financial independence? This is a question I hope will be tackled at the North American Real Estate Summit, which is happening in Edmonton on Saturday, Aug. 24.




I`ll be on a panel that also features four prominent real estate experts or economists: Frank Margani, Ben Myers, Greg Coleman and Irv Kipnes. The grand finale of the event, put on by The Real Estate Investment Network (REIN), will be a talk by David Chilton [pictured] of Dragon`s Den and of course author of the two best-selling books, The Wealthy Barber and The Wealthy Barber Returns. The first 400 people to register will get a free copy of the latter book, and there will be a meet-and-greet with Chilton as well.





Read the full article here.

 

[Ally]

The suburbs aren't the best place to grow old





The upcoming real estate investment summit in Edmonton caught my eye as an event that is likely to be well-attended by a highly engaged audience. Big name speakers, including David Chilton, are on the agenda reflecting the broad appeal that real estate investing holds for Canadians.







Read the full article here.

 

[Ally]

When it comes to your mortgage, every day is opposite day




Have you noticed over the last few months that the banks have really been pushing variable (floating) rate mortgages? The banks are basing this on historical information, which in my opinion is irrelevant today.




It is true that, overall, interest rates have been on a downward trend over the last two decades. There have been a few increases (like 1995), but basically the rates have come down from about 12 per cent in 1990 to a low of 0.91 per cent in 2010 (these rates are based on the average yield of 6 month treasury bills).





Read the full article here.

 

[Ally]

CMHC revises 2014 residential construction estimate




OTTAWA - Canada Mortgage and Housing Corp. says the western provinces are helping stabilize construction activity and momentum will build into next year but 2014 housing starts aren't looking as positive as previously expected.




However, CMHC has lowered its previous estimate for 2014 to about 186,600 units, down 2,300 units from the June estimate of 188,900.





Read the full article here.