It’s time for this week’s top stories cheat sheet.
Canadian real estate
After job boom, Bank of Canada clears another hike: BMO
Canada’s employment data remained strong, with the economy adding 104,000 jobs in December. This brought the unemployment rate down to just 5.0%, just 0.1 percentage points above the 50-year low. BMO explains that this reinforces its expectations of higher interest rates this month. The economy is handling rate hikes so well that we won’t see a rate cut for at least a year.
Canadian property bubble could crash until 2025 as indicators flash warnings
Canadian real estate generally showed moves ahead of an extended correction. Residential investment fell to his 6.7% of GDP in the third quarter of 2022, down from his 8.7% peak this cycle. It’s still on the rise and rivals the share of the economy the US spent on building homes during her 2006 bubble. Only two of her larger modifications were seen in Canada. They follow the bubble, and studies show that contractions lead to long-term adjustments.
Canadian single-family home prices are plummeting, here are the hardest-hit markets
Canadian single-family home prices are seeing the rise disappear as fast as it came. Typical single-family home prices fell to $794,000 in November, down 17.8% (-$172,200) from their peak less than a year ago. The worst-hit markets include Oakville, where prices dropped a whopping $478,600 over the period. The only loss was home prices across Canada just a few years ago.
Canadian mortgages surge after regulators alert
Canadian homeowners took advantage of property windfalls to secure mountains of debt. Loans secured by home equity he reached $308.9 billion in October, up 9.6% (+$27 billion) from last year. Regulators have warned that increased use of home equity loans will increase risk. These warnings apparently led to even faster borrowing.
toronto real estate
Toronto real estate is world’s biggest bubble, officially ‘bursting’
Toronto real estate is the world’s largest real estate bubble and is now bursting. Home benchmark prices fell to $1,089,000 in December, down 21.4% (-$294,600) from its peak. A return in price of more than 20% within 12 months is the technical definition of a crash.