Time for your cheat sheet on this week’s most important stories.
Canadian Real Estate
Canadian Unemployment Is 55% Higher Than G7 Average: OECD
Canada has the fastest growing real estate prices in the G7… and the highest level of unemployment. The country’s rate is now 9.4% in January, up 67.86% from the same month last year. The average for G7 countries and the OECD is 39.19% and 32.98% lower than Canada’s rate, respectively. Despite real estate prices soaring, Canada’s economy trails its advanced economic peers.
Canadian Households Tied To Parental Wealth, As Income Mobility Plummets: Stat Can
Income mobility in Canada is further tied to parents economic status these days. A Stat Can study shows parents in the 1960s had the lowest level of income inequality in decades. Their children’s income status also showed the least correlation. This means children were more likely to move up income brackets. It gets worse until the last cohort analyzes – kids born in the early 80s. The latter’s parents had the worst inequality, and children with the most correlation. In plain english, they were more likely to earn a similar income to their parents.
Canadian Employment Data Shows A K-Shaped Recovery Is Forming For Young People
Canada’s unemployment rate is high, but the youth rate is almost double the national rate. National unemployment came in at 9.4% in January, up 8.8% from the previous month. Youth unemployment in the country comes in at 19.7%, up 10.67% over the same period.
The rate isn’t just high for Canada, it’s high compared to other economic peers. Both the G7 and OECD average are significantly lower than Canada. The faster rising youth rate shows an uneven recovery for youth. This is likely to lead to even more generational inequality in the not so distant future.
The Pandemic Was Bullish For Canadian Real Estate, Confirms National Stats Agency
Canadian real estate prices made one of the biggest jumps in history, according to Stat Can. Their 6-city index shows prices increased 2.5% in Q4 2020, the fastest rise since 2017. The gains were almost exclusively detached homes.
Detached homes saw prices rise over 3.5% in the final quarter of 2020. To contrast, condo apartments increased just 0.16% over the same period. Cheap financing due to the pandemic created a ton of incentive to buy. Unemployment contained largely to low income people, created fewer condo buyers though.
Toronto Real Estate
Toronto Detached Homes Prices Increased $32,500 Just Last Month, While Condos Stall
Toronto real estate has been soaring, but not every segment is hot. Local board data shows a typical detached home reached $1,134,600 in January, up 17% from the same month last year. The monthly increase alone comes in at $32,500. The price of a typical condo apartment, to contrast, reached $575,500 – up just 1.7% from the year before. The monthly increase was less than a mortgage payment on a unit of that cost. Detached homes are soaring, while condos are fairly soft.
Thousands Of Toronto’s AirBnB Investors Plan To Sell This Year
Toronto’s new short-term rental rules have many operators getting out of the market. The local real estate board’s survey shows only 32% of operators felt this would not impact them. Another 40% of owners have decided they’ll sell in the next year. A smaller, but still substantial, 26% of owners have decided to find long-term tenants. The rule changes may result in thousands of units of housing supply coming to market, in just a few months.
Over Two-Thirds Of Toronto Real Estate Investors Plan On Listing Properties For Sale
Toronto real estate investors are looking to sell, says a local board’s latest survey. The survey found 67% of investors were considering selling over the next 12 months. Those “very likely” to sell, came in at 29% of investors that currently own.
The pandemic isn’t entirely responsible either. The survey also found 51% of investors said it had no impact on their decision. It would appear a lot of investors are just looking to cash in on the huge gains they’ve made recently.
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