Time for your cheat sheet on this week’s top stories.
Canadian Real Estate
Canadian Housing Resembles A Return To Victorian-Era Inheritance Culture: Stat Can
Canada is quickly reverting back to a Victorian-era style inheritance culture. That was the suggestion from the country’s national statistics agency, when exploring the role of parental wealth on the homeownership rate of young adults. A lack of upward social mobility can turn into a big problem for Canada, which depends on attracting immigrants. No immigrant has ever said they moved across the world and worked hard so their children could have less opportunity.
Canadian Rents Outpace Income For The First Time In 60 Years: BMO
Canadian real estate prices rose so fast over the past few years, rents are still trying to catch up. The shelter rent index shows rental prices are rising at the fastest rate since the last inflation crisis in 1983. As if that weren’t bad enough, this is the first time rents are rising faster than incomes in the last 60 years. It’s a circumstance that hasn’t occurred under the current monetary standards, giving a little insight into just how out of control the central bank’s embrace of lower interest rates has been.
Canadian Interest Rates 2 Points Higher Due To Gov Spending: Scotiabank
Canada borrowed an unprecedented amount to deal with the pandemic… then kept borrowing. While it was cheap, it wasn’t without consequence, says Scotiabank. The bank estimates excess demand produced from the stimulus helped to drive inflation much higher than needed. As a result, they estimate interest rates are 2 points higher than if governments borrowed at a more moderate pace.
Canada Expects Unemployment To Rise 211k Within Months, Mostly Immigrants
Canada should brace for a higher unemployment rate, according to the Federal Government. In the latest Fall Economic Statement, policymakers expect unemployment to rise by 0.8 points to 6.5% by Q2 2024. That’s roughly 211k more people searching for a job compared to today. They believe this will be mostly due to “population growth,” indicating the burden will fall largely on new immigrants. Not exactly something the country should be writing on an immigration brochure if it counts on sustained growth.
Canadian Inflation Slows But Rents Are Rising At The Fastest Rate In 40 Years
Canadian inflation moderated but life is likely getting a lot more expensive for young adults. The CPI reduction was almost entirely attributed to falling gasoline prices. Grocery prices and shelter on the other hand, continued to rise sharply. The latter, the bulk of most young adult expenses, is rising at the fastest rate in 40 years.
Ontario Leads Canada’s Real Estate Cooldown As Sales Fall To Crisis Levels: RBC
Canadian real estate markets are softening, as falling home sales meet rising inventory. The combination doubled the rate of decline for prices, with Ontario leading the way lower. Existing home sales in the province have now fallen to a level only seen during a crisis. RBC, Canada’s largest bank, sees this trend continuing near-term.
