This Week’s Top Stories: Canadian Mortgage Debt Explodes In Growth, and So Do Insolvencies

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

Canadian Real Estate

Canadian Households And Businesses Are Going Broke Faster Than Last Year
Insolvencies in Canada are seeing a big increase these days.  There were 13,512 insolvency filings in October, up 11% from a month before. The monthly number is up 13% when compared to the same month last year. There were 139,194 insolvencies in the 12-months ending in October, up 8.8% from a period one year before. This implies growth could be accelerating even faster.
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Canadian Mortgage Credit Is Seeing Explosive Growth… Again
Canadian mortgage credit is seeing growth return very quickly. There was $1.61 trillion in mortgage debt outstanding in October, up 4.5% from last year. This is both a new record for the dollar amount, and a multi-month high for growth. In fact, the 3-month annualized growth is now higher than it was before B-20.
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More Than Half Of Canada’s GDP Gain Was From Real Estate Transactions
Real estate transactions represent a disproportionate amount of GDP growth these days. Canada’s GDP was $1.99 trillion seasonally adjusted at the annual rate in Q3 2019, up 1.44% from the same quarter last year. Real estate transactions came in at $252.28 billion of those dollars, up 2.70% higher than last year. Yes, real estate transactions as a percent of GDP is growing nearly 2x the speed of the overall economy.
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Toronto Real Estate

Toronto Household Debt Problems Surface, Insolvencies Rise Over 26%
Toronto households are seeing signs they over borrowed by just a little. Greater Toronto saw 4,626 insolvency filings in Q3 2019, up 26.67% from the same quarter last year. To contrast, Ontario had 11,517 insolvency filings in Q3 2019, up 22.43% from last year. The whole province is seeing fast insolvency growth, but the city is growing even faster.
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Toronto Real Estate Prices Make Second Largest November Jump Ever – Tops 2017 High
Toronto real estate prices are rising, as buyers delayed by B-20 jump back into the market. TREB reported the composite benchmark price reached $815,800 in November, up 6.83% from last year. The City of Toronto reached $903,700, up 6.99% from last year. This is the second largest monthly increase for November, in the history of November for as long as the benchmark has existed. Only the 2016 frenzy beat it.
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Vancouver Real Estate

Greater Vancouver Households Are Going Broke Mega Fast
Greater Vancouver households are going broke faster than usual. There was 1,393 insolvencies filed in the region in Q3 2019, up 25.27% compared to the same quarter last year. To contrast, BC saw a total of 2,926 filings in Q3 2019, up 21.87% compared to the same quarter last year. Greater Vancouver’s insolvency growth is over represented in the latest quarter. In other words, it’s hogging more of the debt failure.
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Greater Vancouver Real Estate Prices Stop Falling, As Sales Jump
Greater Vancouver real estate prices are seeing losses shrink, as sales volume returns. REBGV’s composite benchmark reached $993,700 in November, down 4.6% from last year. Sales in the board reached 2,498 for the month, up 55.3% from last year. Yes, that’s an absurdly large number – but remember last year was a near record low for sales. Instead, that big jump brings sales 4% above the 10-year average volume for the month.
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