Time for your cheat sheet on this week’s top stories.
Canadian Real Estate
Canadian Developers Set A Record For Completed & Unsold New Homes
Canadian real estate developers are sitting on a glut of completed and unsold homes. Builder inventory surged to 19,536 unabsorbed new homes in April, up 36% from last year and triple May 2022 lows. It works out to roughly 2.7 completed and vacant homes on their books for every one delivered to an end user. The country has never had so many finished homes awaiting a buyer, and 375,000 are under construction. In plain english? The problem is going to get worse before it gets better, as prices remain unattractive to buyers.
Canadian Real Estate Demand Balance Hits Weakest Level Since 1995
Canadian real estate prices rose 0.3% to $666,400 in April, moving higher for a third consecutive month. What’s behind the increase? It wasn’t demand or inventory, the month saw the weakest sales and the third-most new listings in 18 years. The combination led the SNLR to plunge to the worst April since 1995, with only 9 worse prints in the past 56 years. Even for a real estate downturn, this is an unusually slow spring for Canadian real estate.
Ontario Is Now Ground Zero For Canada’s Consumer Insolvency Surge
Ontario is ground zero for the surge in Canada’s consumer insolvencies. The province saw 5,109 consumer insolvencies in March, up 10.2% from last year and is now home to 38% of all filings. Back in 2019, the province only represented 31% of filings, meaning it grew 21% faster than average. Since the trend erosion started in 2020, the bulk of this problem began before the recent trade war.
Canada’s Jobless Problem Is Increasingly An Ontario Problem
Canadian unemployment climbed 0.2 points to 6.9% in April, a 7-month high. But this is mostly an Ontario-story, where the rate has climbed to 7.5% in April. The province began underperforming in 2020, and is now home to 2 in 5 (43%) of unemployed workers. Every other province is doing better, with a much lower rate—especially in Quebec (6.3%), Saskatchewan (5.6%), and Manitoba (5.3%).
Canadian Consumer Insolvencies Approach 2009 Record High
Canadian consumer insolvencies are climbing aggressively. The OSB received 13,406 consumer filings in March, 10.6% higher than last year and the second-highest in 17 years. It wasn’t just a period skew—there have been 143,353 filings over the past year, also the second-highest on record. Financial crisis-levels of insolvencies during a period where everything is supposedly fine? It’s probably nothing.
It’s Tuesday. No posts since last week. Come on, you lazy bastards. This is my go to read first thing in the morning. Where my fave Econo/RE blog at?