June 2014 Canadian Economic Fundamentals

[Ally]

Canada household debt/income ratio continues to edge lower





OTTAWA (Reuters) - The ratio of Canadian household debt to income edged down further in the first quarter from the record high it hit last year, buttressing policymakers' expectations that a soft landing is in store for the housing market and family indebtedness.





Statistics Canada reported on Thursday a ratio of 163.2 percent in the first quarter. The ratio reached a record high of 164.1 percent in the third quarter of last year, and dipped to 163.9 percent in the fourth quarter.





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[Ally]

Homeowners happy, confident about purchase





Homeowners are `happy with the decision to buy their home,` feel confident they can weather a downturn in the housing market and they consider mortgage debt to be `good debt.` Their attitudes are the same whether they live in Toronto, Calgary or Vancouver where prices continue to rise, or in areas where home prices are stabilizing, says a new consumer survey report by the Canadian Association of Accredited Mortgage Professionals (CAAMP).





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[Ally]

Ottawa's heavy hand is driving prices in Canada higher than in the U.S.





VANCOUVER ` The price disparities deplored by the Harper government ` the premium Canadians pay to buy at home rather than in the United States ` are growing larger, a new study concludes.





But, `If the federal government is serious about reducing prices for Canadians, it might want to first look at some of its own policies,` says Nicholas Li, writing for the C.D. Howe Institute.





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[Ally]

Canadian housing bears stand their ground as prices keep rising





`I remain of the conviction that one doesn`t drop one`s guard on housing risks as we push toward higher and higher peaks,` he writes in a research note. `Indeed, one`s guard should be raised``





Years after warnings about a potential housing market crash surfaced, national home prices are still hitting new records. The sky has not fallen. Canadians are sick of hearing about impending doom, and housing market bears who continue to raise fears are brushed off much like the boy who cried wolf.





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[Ally]

The high price of housing in Canada





American commentators, it seems, are dumbfounded that Vancouver has been identified as North America`s priciest real estate market.





The latest issue of a U.S.-based monthly print and online publication focusing on real estate remarks that few would be surprised at prohibitive prices in, say, San Francisco or New York. But Vancouver?





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[Ally]

Canada finance minister plays down housing fears





Canada's finance minister has moved to play down fears of a sharp correction in the country's housing market, telling CNBC that while he was monitoring the rising prices closely for signs of overheating, he was "not especially worried."





"We're looking at the housing market, it's of course an issue that we have to be concerned about," Joe Oliver, Canada's finance minister said.





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[Ally]

Higher interest rates coming sooner than advertised





Inflation in Canada has been quietly accelerating in the past six months, and in May it topped 2 per cent for the first time in more than two years. The increases have been broad-based, with inflation accelerating in every major component of consumer price index over this period.





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[Ally]

7.4 million cottage shows Canada's housing boom is feeding surge in vacation homes





A cottage that sold for $7.4 million in Ontario`s Muskoka region highlights the increasing trend of younger, wealthier buyers investing in vacation spots as they profit from housing booms in major cities.





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[Ally]

Low mortgage rates being supporting balanced Canadian home sales





TORONTO, ONTARIO -- (Marketwire) -- 11/15/11 -- Canada's housing market continues to look balanced, with Regina leading the way and red hot Vancouver beginning to cool , according to a commentary from BMO Capital Markets Economics on today's national resale housing activity numbers for October.






"Low mortgage rates are offsetting weaker consumer confidence and cooling job growth," said Robert Kavcic, Economist, BMO Capital Markets. "Relatively stable sales and price trends are likely in the year ahead."





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[Ally]

Cottage market 'healthy, balanced"





Canada`s summer cottage market is showing no signs of cooling off as it rebounds from a long winter and late spring, national Realtor group Re/Max said Wednesday.





Sales in Ontario and Atlantic Canada were up in May after a sluggish April and Re/Max is forecasting mid to high single-digit price increase for cottages, cabins, vacation condos and camps throughout the rest of the year.





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[Ally]

BMO outlines top priorities for homebuyers








TORONTO, ONTARIO--(Marketwired - May 9, 2013) - While there
are a number of factors to consider when deciding on the right location to buy a
home, Canadians view the safety of a neighbourhood to be the most important (63
per cent) feature of a home's location, according to a new BMO Bank of Montreal
survey.






The survey, conducted by Pollara, also found that living on a quiet street
(43 per cent), having good neighbours (30 per cent), having a short commute to
work (28 per cent) and being near family and friends (25 per cent) rank high on
Canadians' list of location priorities when buying a home.





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[Ally]

Canadian finance minister says no housing bubble in Canada





LONDON (Reuters) - Canadian Finance Minister Joe Oliver said on Tuesday there is no housing bubble in Canada. Asked at a bond conference in London if there was a bubble, Oliver said: "No".





"The advice we have received is that we are not in a bubble," he told reporters





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[Ally]

Vacationers from Alberta and Saskatchewan buying BC recreational property





The low dollar is helping lure Canadian recreational property buyers back home and away from the U.S. sun belt, Re/Max`s annual recreational property report suggests.





Buyers from Alberta and Saskatchewan who used to purchase recreational property in hot spots like Arizona and Florida are now buying in B.C.`s Interior, where recreational housing sales are rising, according to Elton Ash, regional executive vice-president for Re/Max of Western Canada. The increase in some areas is striking ` in the North Okanagan, for example, unit sales surged 51 per cent compared to last year, to 223 this May compared to 148 units a year earlier.










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[Ally]

CREA boosts annual forecast as August home sales surge





Low mortgage rates have driven Canadian home sales close to an all-time high, catching many economists by surprise. Sales of existing homes have risen for seven months in a row, according to data released Monday by the Canadian Real Estate Association (CREA), which represents Realtors and tracks the market by way of the Multiple Listing Service. August`s sales level was the highest since January, 2010, and just six per cent below the record peak in February, 2007.





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[Ally]

Canada oil-train boom may thwart winter crude price slump





Each winter for the past four years, Canadian oil sands producers have watched in dismay as local crude prices slumped.





Limited export pipeline capacity coupled with the end of the U.S. summer driving season led to oil gluts in Alberta, sending prices tumbling and depriving producers of billions in potential revenue.





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[Ally]

The top 4 things people pay more to live near





Every homebuyer knows the mantra `location, location, location`. But location, of course, is a relative word. Being located next to a prison or a land fill won`t do much for your home`s resale value. But there are a select few things that people will always pay more to live by. Mountains and oceans are two of them, but since those aren`t exactly nearby for most in the country, here are four things that everyone should look out for`





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[Ally]

Condos a stabilizing force keeping real estate affordable





Real estate associations like the Toronto Real Estate Board (TREB) and the Canadian Real Estate Association (CREA) frequently remind buyers and sellers alike that all real estate is local. No matter what you may read about `average` prices in Vancouver or Toronto or Montreal, the price of a home in your town, on your street, will likely be quite different. It`s a simple reality of arithmetic that widely different values among elements skew averages. But a new commentary from CIBC economist Benjamin Tal maintains that what he calls the `multi-dimensional nature` of Canadian housing `goes way beyond geography.`





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