Top Stories

This Week’s Top Stories: Toronto Real Estate Looks Like A Classic Bubble Chart, and Canadian Interest Rate Hikes Are Setting Up For An Economic Slowdown

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

Canadian Real Estate

Canada’s Minor Interest Rate Hikes May Be Setting Up Major Economic Problems

The impact of rising interest rates is showing up in Canada’s measure of “cash.” The M1+, a measure of cash-like instruments, increased 3.9% on an annual basis in July, down over 60% from the year before. This is the slowest pace of growth since 2003, so we pulled up some old Bank of Canada reports to see what was up. In 2003, Canada “unexpectedly” showed slowing economic growth, and a surge in energy costs. Sound familiar?

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Canadian Mortgage Credit Growth Grinds To A Halt, Worst Growth In 18 Years

Canadians hit a new all-time high for mortgage credit, but growth was cut in half. The balance of mortgages hit $1.52 trillion, up $4.95 billion from the month before. That works out to $54.22 billion higher than last year, an increase of 3.7% from the year before. This is the slowest pace of growth since July 2001.

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Toronto Real Estate

Toronto Real Estate Prices Literally Look Like The Textbook Chart For Asset Bubbles

Toronto real estate prices are printing a path that looks like a classic asset bubble chart. We take a dive through an asset bubble chart that surfaced in 2008, and walk through the stages. We won’t make any conclusions about Toronto real estate, but we do arm you with what you should be looking for, and what would come next.

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Toronto Real Estate Sales Rise In The 905, Drop In The City

Toronto real estate sales are on the rise in the suburbs, but finally started to taper in the City of Toronto. The price of a typical home in Greater Toronto reached $768,800 in August, up just 1.45% from the month before. The City of Toronto saw prices hit $832,200, up 6.07% from last year. The City’s price growth is now slower than inflation, while the suburbs are spiking in growth. Sure, that makes sense.

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Vancouver Real Estate

Vancouver Real Estate Sales Drop Over 36%, Slowest Price Growth Since 2014

Vancouver real estate is seeing a dramatic shift, as sales drop and supply rises. The Real Estate Board of Greater Vancouver (REBGV) reported 1,929 sales, down a massive 36.6% from last year. The decline in sales helped to push inventory higher, relieving a lot of pressure on prices to move higher. The price of a typical home across the REBGV is now $1,083,400 in August, up 4.1% from last year. That’s still huge growth, but it’s the lowest pace of growth we’ve seen since April 2014.

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