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The Outlook for Mortgage Arrears in Canada
Recent headlines warn that Canadian mortgage arrears have climbed to their highest level in nearly a decade, driven by a wave of higher-cost renewals, elevated inflation, and rising unemployment. While the headlines are attention-grabbing, the underlying story is less dramatic. Mortgage arrears, defined as payments overdue by 90 days or more, have risen nationally from…
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The Fed’s New Communication Strategy: Warsh’s Approach and the Bond Market Reaction
Kevin Warsh took over as Federal Reserve chair with the goal of scaling back its communications, arguing that years of extensive forward guidance had made markets overly reliant on Fed signalling rather than economic data. In his view, a leaner Fed voice would help restore market discipline. Since taking office, Federal Open Market Committee (FOMC)…
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Are We Building the Right Kind of Housing?
Housing economist Frank Clayton recently published a report for the C.D. Howe Institute examining the mismatch between housing preferences and housing supply in the Greater Toronto and Hamilton Area (GTHA). Drawing on three independent surveys — CMHC’s Mortgage Consumer Survey, the Toronto Regional Real Estate Board’s annual buying and selling intentions survey, and Sagen Canada’s…
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Is Housing a Drag on the Economy?
According to CIBC Economics, falling home prices and eroding real estate wealth are creating a negative wealth effect that is acting as a significant headwind for consumer spending in Canada. Conventional economic theory holds that changes in household wealth are an important driver of economic activity, influencing household consumption decisions. The permanent income hypothesis, for…
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Canada’s Housing Market — Are We Near the Bottom?
Canada’s housing market appears to have found a floor, as recent resale data suggest homebuying activity is picking up after a weak start to the year. June data show existing home sales rose 0.9 per cent from a year earlier and 0.5 per cent from May on a seasonally adjusted basis, while new listings fell…
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Inflation Cools in June as Core Pressures Ease
Headline inflation eased to 2.8 per cent year-over-year in June, down from 3.2 per cent in May, according to Statistics Canada. Consumer prices fell 0.4 per cent month-over-month — the largest monthly decline since December 2024 — while the seasonally adjusted decline was a more modest 0.1 per cent, marking the first monthly decrease since…
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Individual and Institutional Investors in the Canadian Housing Market
Statistics Canada recently released a report that examines the size and role of residential property investors in Prince Edward Island, Nova Scotia, New Brunswick, Ontario, Manitoba, and British Columbia, using 2022 assessed-value data from the Canadian Housing Statistics Program. Investors are grouped into six categories, ranging from individuals who own a small number of rental…
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