Time for your cheat sheet on this week’s top stories.
Canadian Real Estate
Canada’s Real Estate Bubble: First-Time Buyers Need To Be Among Top Earners
First-time home buyers need to be among the wealthiest households in Canada. That’s the take from new Statistics Canada (StatCan) data revealing their income. The agency’s data reveals these buyers earn between 13% and 36% more than the median in 2023. While the agency only provided data going back to 2021, it’s enough to show a sharp erosion in affordability. Even if you’re not a first-time buyer, this data presents a concern for the current home valuations. There simply isn’t enough liquidity when only the top earners can afford to step on the property ladder.
Canadian Real Estate Nears A Bottom? RBC Calls It For An 8th Time In 4 Years
RBC is calling a bottom for Canadian real estate markets, much to the joy of the industry. It’s welcome news, but there’s just one teensy problem—the bank has done this at least 2x/year since the market peak. They first called a bottom a few months after the peak, while interest rates were still climbing. Reviewing the history it appears these calls weren’t based on any data we could see. In other words, RBC’s call looks more like wishful thinking than reality—so it’s nothing to get excited about.
Canadian GDP Growth Rebounds In Q2, Driven By Temporary Events
Canadian GDP surprised by expanding 0.3% in June, helping to finish Q2 0.9% higher—a stronger finish than expected. Headline data even looked broad, with 13 of 20 industrial sectors contributing. Drilling down into the details, a lot of heavy lifting was temporary events like the Census and World Cup. Unless Canada holds those quarterly going forward, it’s hard to see this being repeatable. While things appear healthy, we’re a long way from being in the clear.
Canadian Bank Mortgages Near 6-Year Low As Arrears Barely Budge
The arrears rate for Canadian bank mortgages fell to 0.28% in June, marking the first drop in over a year. Only 40 fewer mortgages in arrears triggered that drop, but it was amplified by rounding. Material improvements are much smaller than the rounded data suggests. However, there was a more troubling data point to pay attention to—total bank mortgages. Canada’s banks now hold the fewest since 2020, rolling back virtually the entire low rate boom. As their market share shrinks, so does the relevance of this data point.
Canada’s Credit Divide: Balances Soar In East, Defaults Rise In Ontario
Non-mortgage debt is rising in Eastern Canada, while arrears rise everywhere else. That was the takeaway from newly released Equifax data. Nationally, non-mortgage debt rose 2.1% to $712.2 billion in Q2 2026. The brisk growth is concentrated in Atlantic provinces, with lower average balances. Heavily indebted provinces like Ontario have seen growth slow as missed payments soar. Research shows this has more to do with housing than most would expect.
