September 2012 Canadian Economic Fundamentals
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Europe key risk to future growth, Canada's finance minister says
Canada`s economy grew at a modest pace in the latest quarter as business investment rose faster than expected while debt-laden consumers curbed their spending.
Canada`s gross domestic product rose at a 1.8 per cent annualized rate, Statistics Canada said Friday. That was a bit higher than economists` projections and nearly in line with the Bank of Canada`s 1.9 per cent forecast.
Still, it was the third quarter in a row Canada`s economic growth remained sluggish as the financial crisis in Europe and political deadlock in the U.S. continue to loom over global growth.
Read the full article here.
Canada`s economy grew at a modest pace in the latest quarter as business investment rose faster than expected while debt-laden consumers curbed their spending.
Canada`s gross domestic product rose at a 1.8 per cent annualized rate, Statistics Canada said Friday. That was a bit higher than economists` projections and nearly in line with the Bank of Canada`s 1.9 per cent forecast.
Still, it was the third quarter in a row Canada`s economic growth remained sluggish as the financial crisis in Europe and political deadlock in the U.S. continue to loom over global growth.
Read the full article here.
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Tenants help pay for first home
Sean Cooper has graduated from renter to homeowner, at the age of 27, in one of Canada`s most expensive housing markets.
To do so, he will live in a basement apartment while the tenants upstairs pay much of his mortgage and ownership costs, at least until he is out of debt. `I got the idea from Scott McGillivray, host of Income Property on HGTV Canada,` he admits.
Read the full article here.
Sean Cooper has graduated from renter to homeowner, at the age of 27, in one of Canada`s most expensive housing markets.
To do so, he will live in a basement apartment while the tenants upstairs pay much of his mortgage and ownership costs, at least until he is out of debt. `I got the idea from Scott McGillivray, host of Income Property on HGTV Canada,` he admits.
Read the full article here.
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Monreal real estate market stalled by PQ talk
Some observers of the Montreal real estate market say potential home buyers are holding off until they know who wins the Sept. 4 provincial election.
The market traditionally slows in summer and new regulations concerning mortgages have been imposed but some brokers say buyers are also taking a wait-and-see attitude to protect their investment or maybe get a better price after Sept. 4.
Read the full article here.
Some observers of the Montreal real estate market say potential home buyers are holding off until they know who wins the Sept. 4 provincial election.
The market traditionally slows in summer and new regulations concerning mortgages have been imposed but some brokers say buyers are also taking a wait-and-see attitude to protect their investment or maybe get a better price after Sept. 4.
Read the full article here.
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Canada to revise guidelines for GDP
OTTAWA ` Statistics Canada will be making the biggest revisions in 15 years to national accounts data as part of an international shift to updated standards, an official said on Friday.
The changes will reflect guidelines released in 2008 by the United Nations, the International Monetary Fund and other international bodies. The last such revision was done in 1997, based on a 1993 standard.
Read the full article here.
OTTAWA ` Statistics Canada will be making the biggest revisions in 15 years to national accounts data as part of an international shift to updated standards, an official said on Friday.
The changes will reflect guidelines released in 2008 by the United Nations, the International Monetary Fund and other international bodies. The last such revision was done in 1997, based on a 1993 standard.
Read the full article here.
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EU, U.S. pose 'downward risk' to Canada's economy
Federal finances have dramatically improved over the same time a year ago, but Finance Minister Jim Flaherty is warning about significant "downward risk" to the Canadian economy due to the ongoing financial crisis in Europe and a sluggish rebound in the United States.
Should the global economy take a severe downturn, Flaherty said the government is prepared to step in - as it did in the aftermath of the 2008 financial crisis - with fiscal measures to spur the Canadian economy and protect domestic jobs.
Read the full article here.
Federal finances have dramatically improved over the same time a year ago, but Finance Minister Jim Flaherty is warning about significant "downward risk" to the Canadian economy due to the ongoing financial crisis in Europe and a sluggish rebound in the United States.
Should the global economy take a severe downturn, Flaherty said the government is prepared to step in - as it did in the aftermath of the 2008 financial crisis - with fiscal measures to spur the Canadian economy and protect domestic jobs.
Read the full article here.
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The pros and cons of buying a fixer upper
It`s a first-time homebuyer`s dream: Snag a rundown house in a terrific neighborhood, and then revamp it to your heart`s content.
But fair warning, that fixer-upper could become your worst nightmare.
`You have to really know what you`re getting into,` says Zillow.com real estate expert Brendon DeSimone. `It could be the case where it seems like a good price and then you dig deeper and find that the windows are off, the electrical foundation is messy, and so on.`
Translation: You could wind up spending more than you bargained for.
We asked DeSimone to list the pros and cons:
Read the full article here.
It`s a first-time homebuyer`s dream: Snag a rundown house in a terrific neighborhood, and then revamp it to your heart`s content.
But fair warning, that fixer-upper could become your worst nightmare.
`You have to really know what you`re getting into,` says Zillow.com real estate expert Brendon DeSimone. `It could be the case where it seems like a good price and then you dig deeper and find that the windows are off, the electrical foundation is messy, and so on.`
Translation: You could wind up spending more than you bargained for.
We asked DeSimone to list the pros and cons:
Read the full article here.
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Canadians happy with job security
We seem more optimistic about the hiring plans and growth prospects of companies we work for than we were this time last year, according to the annual BMO Labour Day survey.
The report, which was released Sunday, shows that 41% of Canadians believe their company is growing and expect it will be hiring this year. Almost two-thirds are comfortable with their job security (up 13 percentage points from 2011), and four-in-ten expect to receive a raise or promotion this year (up 11 percentage points from 2011).
Read the full article here.
We seem more optimistic about the hiring plans and growth prospects of companies we work for than we were this time last year, according to the annual BMO Labour Day survey.
The report, which was released Sunday, shows that 41% of Canadians believe their company is growing and expect it will be hiring this year. Almost two-thirds are comfortable with their job security (up 13 percentage points from 2011), and four-in-ten expect to receive a raise or promotion this year (up 11 percentage points from 2011).
Read the full article here.
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Economy's foggy future poses challenge for Carney
A committee of economists that closely follows the Bank of Canada is deeply divided on where the Canadian economy is headed over the next year, providing a window into the difficulty Mark Carney faces in charting a course back to a more normal interest rate setting.
The club in question is the Toronto-based C.D. Howe Institute`s Monetary Policy Council, which publishes an interest rate recommendation a week ahead of the Bank of Canada`s official announcements.
Read the full article here.
A committee of economists that closely follows the Bank of Canada is deeply divided on where the Canadian economy is headed over the next year, providing a window into the difficulty Mark Carney faces in charting a course back to a more normal interest rate setting.
The club in question is the Toronto-based C.D. Howe Institute`s Monetary Policy Council, which publishes an interest rate recommendation a week ahead of the Bank of Canada`s official announcements.
Read the full article here.
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What can hurt a home's appraisal
Owners can take steps to avoid having their home appraised at a lower value than the asking price.
`Taking the time to understand the areas that can positively influence your appraisal can help ward off the chances that your home will be appraised at a lower value than the asking price,` according to a recent article at Realty Times, which highlights ways sellers can prepare for an appraisal.
Here are a few ways that home owners can hurt their appraisal, according to the piece.
Read the full article here.
Owners can take steps to avoid having their home appraised at a lower value than the asking price.
`Taking the time to understand the areas that can positively influence your appraisal can help ward off the chances that your home will be appraised at a lower value than the asking price,` according to a recent article at Realty Times, which highlights ways sellers can prepare for an appraisal.
Here are a few ways that home owners can hurt their appraisal, according to the piece.
Read the full article here.
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Demand for condos supported by demographics
TORONTO, Aug. 30, 2012 /CNW/ - First-time buyers, retirees and population growth will continue to fuel the demand for condos in major Canadian cities over the next few years, according to a new report released by Genworth Financial Mortgage Insurance Company Canada (Genworth Canada).
Genworth Canada's Summer 2012 Metropolitan Condo Outlook notes that while rising prices for single-detached homes are increasingly driving first-time buyers toward condominiums, retirees aged 55 or more are also drawn to condo living and continue to be pervasive condominium buyers. The report states that over the next few years, a growing population in all eight cities studied, and a rapidly increasing component of the population aged 55 or more, will provide vital demographic support.
Read the full article here.
TORONTO, Aug. 30, 2012 /CNW/ - First-time buyers, retirees and population growth will continue to fuel the demand for condos in major Canadian cities over the next few years, according to a new report released by Genworth Financial Mortgage Insurance Company Canada (Genworth Canada).
Genworth Canada's Summer 2012 Metropolitan Condo Outlook notes that while rising prices for single-detached homes are increasingly driving first-time buyers toward condominiums, retirees aged 55 or more are also drawn to condo living and continue to be pervasive condominium buyers. The report states that over the next few years, a growing population in all eight cities studied, and a rapidly increasing component of the population aged 55 or more, will provide vital demographic support.
Read the full article here.
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Canada job growth seen slow in August
OTTAWA (Reuters) - After some outsized gains and losses in the past five months, most economists expect Canada's job market to settle down to a pattern of slow growth.
March and April had shown a whopping 140,500-job gain for the two months, and July surprised with a loss of 30,400, with little evidence of accompanying bursts of economic activity or a sudden slowdown.
"Although it is unlikely that the heavy job losses from July continued, we're not exactly expecting vigorous employment growth," IHS Global Insight economists Arlene Kish and Jillian Kohut wrote in a note to clients.
Read the full article here.
OTTAWA (Reuters) - After some outsized gains and losses in the past five months, most economists expect Canada's job market to settle down to a pattern of slow growth.
March and April had shown a whopping 140,500-job gain for the two months, and July surprised with a loss of 30,400, with little evidence of accompanying bursts of economic activity or a sudden slowdown.
"Although it is unlikely that the heavy job losses from July continued, we're not exactly expecting vigorous employment growth," IHS Global Insight economists Arlene Kish and Jillian Kohut wrote in a note to clients.
Read the full article here.
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NWT politicians keep an eye on ripple effects of shale oil development
CALGARY - If an emerging oil deposit in the Northwest Territories winds up being as massive as many expect it to be, a local politician says it's going to take a lot of planning to make sure government services and regulatory oversight keep up with the resulting economic boom.
Norman Yakeleya, who represents the Sahtu region in the territorial legislature, likens what's going on in the area to corn kernels on a stove that's heating up.
"And then all of a sudden ` bang, bang, pop, pop. Pretty soon you have an explosion of everything," he said.
"We've got to prepare for this and we've got to get our numbers right here."
The Sahtu area in the central Mackenzie Valley is home to the Canol shale formation, which some estimate could contain between two and three billion barrels of oil.
Last winter, the region got a small taste of some of the ripple effects an oil and gas boom could bring.
Read the full article here.
CALGARY - If an emerging oil deposit in the Northwest Territories winds up being as massive as many expect it to be, a local politician says it's going to take a lot of planning to make sure government services and regulatory oversight keep up with the resulting economic boom.
Norman Yakeleya, who represents the Sahtu region in the territorial legislature, likens what's going on in the area to corn kernels on a stove that's heating up.
"And then all of a sudden ` bang, bang, pop, pop. Pretty soon you have an explosion of everything," he said.
"We've got to prepare for this and we've got to get our numbers right here."
The Sahtu area in the central Mackenzie Valley is home to the Canol shale formation, which some estimate could contain between two and three billion barrels of oil.
Last winter, the region got a small taste of some of the ripple effects an oil and gas boom could bring.
Read the full article here.
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The rent generation comes of age
On a hot summer evening, Michelle Kay is sitting in the living room-cum-office of her one-bedroom railroad apartment on the second floor of a house on a residential street north of Koreatown.
Wearing a floral print summer dress, she`s a petite 31-year-old with black hair falling below her shoulders and a melodious laugh. Since May, she`s had a full-time job as librarian and communications officer for the Goethe-Institut, the non-profit German cultural association near King St. W. and University Ave. It`s a nice commute, although uphill on the way home so she`s cooling off with an iced tea in a mason jar.
Read the full article here.
On a hot summer evening, Michelle Kay is sitting in the living room-cum-office of her one-bedroom railroad apartment on the second floor of a house on a residential street north of Koreatown.
Wearing a floral print summer dress, she`s a petite 31-year-old with black hair falling below her shoulders and a melodious laugh. Since May, she`s had a full-time job as librarian and communications officer for the Goethe-Institut, the non-profit German cultural association near King St. W. and University Ave. It`s a nice commute, although uphill on the way home so she`s cooling off with an iced tea in a mason jar.
Read the full article here.
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Canadians starting to get it: Flaherty
TORONTO -- Finance Minister Jim Flaherty says he's still concerned about the mortgage debt Canadians are carrying, but adds he thinks they're getting the message interest rates won't stay low forever.
"I remain concerned about people taking on larger obligations than they would be able to afford were interest rates to go up, as they inevitably will," Flaherty said.
"But other things are going on too. I think Canadians are increasingly getting the message that at some point interest rates are likely to rise."
Canadians, Flaherty added, are "starting to understand the risk there and that it's prudent not to overextend oneself."
Read the full article here.
TORONTO -- Finance Minister Jim Flaherty says he's still concerned about the mortgage debt Canadians are carrying, but adds he thinks they're getting the message interest rates won't stay low forever.
"I remain concerned about people taking on larger obligations than they would be able to afford were interest rates to go up, as they inevitably will," Flaherty said.
"But other things are going on too. I think Canadians are increasingly getting the message that at some point interest rates are likely to rise."
Canadians, Flaherty added, are "starting to understand the risk there and that it's prudent not to overextend oneself."
Read the full article here.
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Prices climb despite slower market
Despite a cooling real estate market, the average home price in Canada reached a record high in July.
According to data released by the Teranet National Bank Home Price Index, selling prices across the country increased by only 0.7% in July, down slightly from the 1% increase that occurred in the two months prior.
From a yearly perspective, prices have increased by 4.8% from last year, but have been showing signs of deceleration overall for the past eight months.
The new data has also impacted the buying situation in many of Canada`s larger real estate markets. For example, in Toronto, the country`s largest overall market, prices have risen by an average of 9.2%, a statistic that may spark the interest of prospective investors. However, the prices have fallen in Victoria, BC, by a rate of 0.4% since July 2011.
The decrease in average prices should not be viewed as a major deterrent to investors, as buying prices are still relatively high.
Read the full article here.
Despite a cooling real estate market, the average home price in Canada reached a record high in July.
According to data released by the Teranet National Bank Home Price Index, selling prices across the country increased by only 0.7% in July, down slightly from the 1% increase that occurred in the two months prior.
From a yearly perspective, prices have increased by 4.8% from last year, but have been showing signs of deceleration overall for the past eight months.
The new data has also impacted the buying situation in many of Canada`s larger real estate markets. For example, in Toronto, the country`s largest overall market, prices have risen by an average of 9.2%, a statistic that may spark the interest of prospective investors. However, the prices have fallen in Victoria, BC, by a rate of 0.4% since July 2011.
The decrease in average prices should not be viewed as a major deterrent to investors, as buying prices are still relatively high.
Read the full article here.
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Resources drive Canadian economy
The federal Conservatives have recalculated the national economic impact of energy and mining to help defend their strong support of the natural-resource sector against environmentalists and others.
Natural Resources Minister Joe Oliver says his officials have calculated how much income the sector brings to the economy - instead of just counting barrels of oil and tonnes of metal.
In 2011, the figures show, energy, forestry, metals and minerals directly accounted for 15 per cent of the country's income. When indirect effects are taken into account, Oliver said, natural resources drive 20 per cent of the economy - and about 10 per cent of all the jobs in Canada.
Read the full article here.
The federal Conservatives have recalculated the national economic impact of energy and mining to help defend their strong support of the natural-resource sector against environmentalists and others.
Natural Resources Minister Joe Oliver says his officials have calculated how much income the sector brings to the economy - instead of just counting barrels of oil and tonnes of metal.
In 2011, the figures show, energy, forestry, metals and minerals directly accounted for 15 per cent of the country's income. When indirect effects are taken into account, Oliver said, natural resources drive 20 per cent of the economy - and about 10 per cent of all the jobs in Canada.
Read the full article here.
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Canadian real estate sector looks bright
Low interest rates and strong economic growth in Western Canada should support Canada`s real estate investment trusts and operating companies, despite a sluggish and risky outlook for the global economy, credit-rating agency DBRS says.
The rating agency has completed a review of the sector and says that operating performance is stable, credit metrics are reasonable, liquidity is adequate and debt maturities are evenly spread out. With interest rates expected to remain low for an extended period of time, the supply of buildings limited (across the board in retail, industrial, office and multifamily), and Canadian economic growth solid ` especially in the west ` DBRS said it expects the credit risk profiles of companies in this sector to remain stable going forward.
Read the full article here.
Low interest rates and strong economic growth in Western Canada should support Canada`s real estate investment trusts and operating companies, despite a sluggish and risky outlook for the global economy, credit-rating agency DBRS says.
The rating agency has completed a review of the sector and says that operating performance is stable, credit metrics are reasonable, liquidity is adequate and debt maturities are evenly spread out. With interest rates expected to remain low for an extended period of time, the supply of buildings limited (across the board in retail, industrial, office and multifamily), and Canadian economic growth solid ` especially in the west ` DBRS said it expects the credit risk profiles of companies in this sector to remain stable going forward.
Read the full article here.
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Record first half for Canadian commercial real estate market
CALGARY ` Canada`s commercial real estate market put in its best showing ever in the first half of 2012 with sales transactions reaching $13.9 billion, according to a report by CBRE Limited.
And the Calgary market contributed nearly $2 billion to that total. As well, Calgary recorded three of the top 10 transactions in the country so far this year.
Nationally, the dollar volume is up 23.4 per cent from the same period last year and also outpaces the first six months of 2007, when Canada`s commercial real estate market went on to record its best 12-month period ever with $32.1 billion in trades, said CBRE.
Read the full article here.
CALGARY ` Canada`s commercial real estate market put in its best showing ever in the first half of 2012 with sales transactions reaching $13.9 billion, according to a report by CBRE Limited.
And the Calgary market contributed nearly $2 billion to that total. As well, Calgary recorded three of the top 10 transactions in the country so far this year.
Nationally, the dollar volume is up 23.4 per cent from the same period last year and also outpaces the first six months of 2007, when Canada`s commercial real estate market went on to record its best 12-month period ever with $32.1 billion in trades, said CBRE.
Read the full article here.
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High consumer debt raises recession risk
With nearly half of Canadians living paycheque to paycheque, economists worry that a second recession could ensue if overstretched consumers can`t help boost spending.
A new report from Moody`s Analytics warns that Canada could fall into a second recession, due to external economic pressures, hastened by consumers carrying too much debt.
Debt-to-income ratios are at an all-time high of 150 per cent, thanks to low interest rates and a strong housing market. They are now higher in Canada than they were in the U.S. prior to the subprime mortgage crisis.
Read the full article here.
With nearly half of Canadians living paycheque to paycheque, economists worry that a second recession could ensue if overstretched consumers can`t help boost spending.
A new report from Moody`s Analytics warns that Canada could fall into a second recession, due to external economic pressures, hastened by consumers carrying too much debt.
Debt-to-income ratios are at an all-time high of 150 per cent, thanks to low interest rates and a strong housing market. They are now higher in Canada than they were in the U.S. prior to the subprime mortgage crisis.
Read the full article here.