This Week’s Top Stories: Canada’s Heavy Immigration Is Hiding Weak GDP Data, and Mortgage Debt Grows

Time for your weekly cheat sheet on this week’s most important stories.

Canadian Real Estate

Canada’s Heavy Immigration Is The Last Pillar Preventing A Recession
Canada’s economy looks like it’s booming, but it’s not all that impressive when immigration is factored in. Real gross domestic product (GDP) per capita hit $55,480 in Q2 2019, up just 0.2% from a year before. This is the lowest growth since 2016, during the oil patch recession. Prior to that, GDP per capita growth was only lower around the Great and Early 1990s recessions.
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Canada’s Job Market Improves, With 4 Out 5 Jobs Coming From Self-Employment
Canadian unemployment is falling, mostly due to Canadians pursuing self-employment options. Canada added 54,000 jobs in September, with 42,000 of the jobs coming from self-employment. Self-employment represented 77.8% of jobs gained in September. More interesting, 40% of the net gain in self-employed roles were created just last month. The numbers were a little odd, to say the least.
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Canadian Mortgage Growth Is Surging Higher, And Hasn’t Done This In Over 2 Years
Canadian mortgage growth has returned, and the rate of growth is higher than the year before. The balance of mortgage credit outstanding hit $1.59 trillion in August, up 4.0% from a year before. The 12-month rate of growth is 8.1% higher than it was just a year ago. This is the first time in almost two years where the 12-month growth is higher than a year before.
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Canadian Household Debt Is Growing, But There’s An Unusual Divergence
Growth of Canadian mortgage debt is accelerating, but consumer credit growth is decelerating. Mortgage credit outstanding reached $1.59 trillion in August, up 4.0% from a year before. Consumer credit reached $637 billion in August, up 3.1% from a year before. The rate of growth for mortgages is faster, but consumer credit is slowing down. The divergence is unusual, considering economic growth usually isn’t concentrated to just a single segment of credit. Typically divergences like this don’t last long, but it’s difficult to tell which trend is heading in the right direction right now.
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Toronto Real Estate

Toronto Real Estate Sales Jump Double Digits, Just Under Typical Volumes Again
Toronto real estate prices are climbing, and sales are just under typical volumes for the market again. TREB reported the benchmark hit $805,000 in September, up 5.23% from last year. TREB sales hit 7,825 in September, up 21.22% from the same month last year. Sales are 1.91% below the 5-year average for the month. Prices are climbing and sales are almost back to normal.
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Vancouver Real Estate

Vancouver Real Estate Prices Won’t Stop Falling, But Sales Are Back To Normal
Vancouver real estate prices are still falling, even though sales volumes have returned back to normal. REBGV reported a benchmark price of $990,600 in September, down 7.3% from last year. Sales in the region fell to 2,333, up 46.3% from the same month last year. Sales volumes for the month are 1.7% below the 10-year average for the month. Sales have recovered, but prices are still making substantial declines.
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