October 2013 Canadian Economic Fundamentals

[Ally]

Many Canadians don't see the importance of oil expert




As almost everyone knows by now, Canada has some interesting challenges looming when it comes to transporting increasing oil production to markets both inside and outside of Canada.




But what many Canadians might not realize is how important oil exports are to Canada's economy. Canada has the world's third-largest proven oil reserves, is the fifth-largest exporter of crude oil, and is the fifth-largest producer of crude oil in the world. And that's only expected to grow: According to the Canadian Association of Petroleum Producers, production of oil from Alberta's oilsands is expected to more than double by 2030, rising from the 2012 level of 3.2 million barrels of oil per day to 6.7 million barrels per day.




What would that mean for the Canadian economy? In 2011, the Canadian Energy Research Institute (CERI) projects that investments and revenues from new oilsands projects would be approximately $2 trillion over the period from 2010 to 2035, with a total GDP impact of $2.1 trillion in Canada. Employment, both direct and indirect stemming from new oilsands investments is projected to grow from 75,000 jobs in 2010 to over 900,000 jobs by 2035. And CERI's estimate is somewhat more conservative than CAPP's, estimating oil production at only 5.4 million barrels per day by 2035.





Read the full article here.

 

[Ally]

Condo buyers struggle to adjust to borrowing rule changes




Recent changes to mortgage rules in Canada have left some condo buyers unable to afford their purchases, say professionals who are watching some clients struggle to hang on to their future homes.




For years, buyers have been pre-approved for mortgages for units in Toronto buildings before shovels are even in the ground. But new federal rules on borrowing means new realities for people who thought they got the green light.





Read the full article here.

 

[Ally]

More buyers biting in Canada





The Canadian housing market has quietly ended its correction and is predicted to rise again, with leading cities selling more properties last month compared with a year back.



Toronto Real Estate said homes sold in Ontario's capital city through the Multiple Listing Service jumped 30 percent in September, while Calgary, Alberta, has seen a 19 percent growth.





Read the full article here.

 

[Ally]

Gen Y struggles in expensive housing, rental market




Some of Generation Y is rebelling against an uphill battle of purchasing affordable homes or securing reasonable rentals by moving into non-traditional alternatives like cars, boats and collective houses.




Steep prices and precarious employment can make it difficult for millenials to find suitable rentals or buy property.





Read the full article here.

 

[Ally]

Canada's housing market in for a soft landing






Canada`s housing market will have a `soft landing` after years of strong gains and recent steps by policy makers to curb demand, said Michael Gregory, senior economist at BMO Capital Markets.




`Things don`t look too out of whack` for housing and consumer finances, he told investors during an economist panel discussion at the Bloomberg Focus Day Symposium in Toronto. `Housing is going to cool, a soft landing still seems to be unfolding,` he said.





Read the full article here.

 

[Ally]

No proof of job crisis in Canada, TD says




OTTAWA ` Skills crisis? Not really. A mismatch of jobs to locations? Perhaps, but there`s not much data to back that up.




That`s just a splash of the `cold water` that TD Economics says is needed to calm concerns over Canada`s labour market.





Read the full article here.

 

[Ally]

Montreal's commercial property taxes reach new high






TORONTO, Oct. 21, 2013 /CNW/ - Montreal's commercial tax rates continued to increase with startling speed in 2013, soaring for the second year in a row past Canada's two other highest-rate cities, Vancouver and Toronto. This was part of the "encouraging and alarming" results revealed in the 2013 Property Tax Rate Analysis produced by Altus Group for The Real Property Association of Canada (REALpac), released today.




Despite Montreal, Toronto and Vancouver posting the highest commercial-to-residential tax ratios, all in excess of 4:1, Toronto continued its slow but steady downward trend for the tenth consecutive year. Vancouver's slight increase was attributed to reductions in its residential taxes that outpaced those of its commercial rate.





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[Ally]

Alberta at the crossroads - debts, pipelines, floods




The easy years of giant surpluses created by a burgeoning energy industry and increased prosperity seem to have come abruptly to an end.




The province is now burdened by debts, the oilsands are under increasing attack from a well-heeled environmental lobby and from the European Union, pipeline projects including the Northern Gateway intended to carry bitumen to markets in Asia and the Keystone project intended for North American refineries are facing fierce opposition, and southern Alberta was ravaged by floods in 2013. Add to the mix the fact that the "bitumen bubble," while much smaller than it once was, will not be punctured any time soon and that prices for natural gas remain low.





Read the full article here.

 

[Ally]

Tories say EU trade deal could grow economy by $12B




OTTAWA ` The federal Conservative government is launching a cross-country blitz to sell the new trade deal with Europe, though some say its claims on how much Canadians will benefit are `dishonest.`




The government says Canada`s economy will grow by as much as $12 billion once the massive free trade deal comes into effect, creating up to 80,000 jobs and increasing the average Canadian household`s income by $1,000.





Read the full article here.

 

[Ally]

Canada doesn't get sexier than this




`WORTHWHILE Canadian Initiative` is the most boring headline in history. So said Michael Kinsley, an American journalist and erstwhile contributor to these pages. The tedious title that inspired this vile slur on a worthy nation appeared above an article in the New York Times in 1986 hailing an effort to liberalise trade. Now, Canada is again proving to be a global leader in free trade`and in an exciting way.




On October 18th it announced an agreement in principle with the European Union on a Comprehensive Economic and Trade Agreement (CETA). More than a blessing for insomniacs, CETA is a prototype for bigger things to come, especially the Transatlantic Trade and Investment Partnership (TTIP) now under negotiation between the EU and the United States.





Read the full article here.

 

[Ally]

Oilsands help Canada live long and prospser





OTTAWA - Employment Minister Jason Kenney has a blunt message anyone hoping Canada's energy industry will dry up.



"Until we invent the famous dilithium crystals from Star Trek, which I understand are produced by crushing unicorn horns ... oil and gas will continue to be the mainstay of the global energy market," Kenney told the World Petroleum Council Youth Forum in Calgary on Friday.





Read the full article here.

 

[Ally]

Falling rates, BoC's stand put housing spotlight on Flaherty




Jim Flaherty`s balancing act is getting harder.




For the past few years, the Finance Minister has been trying to prevent Canadian house prices and consumer debts from rising too quickly ` without causing a major slump in the real estate market that would hurt the economy. Four times, he has changed Ottawa`s rules governing mortgages to reel in overheated home prices.





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[Ally]

Canada's housing numbers come under greater scrutiny




Canada's surprisingly strong real estate market is leading to heightened scrutiny of the data used to assess sales.




The main source of information about residential sales and prices is the Canadian Real Estate Association, which represents more than 100,000 real estate agents across the country. On or around the 15th day of each month, after obtaining and working with numbers from local real estate boards, CREA releases information about the previous month's sales levels.





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[Ally]

Bank of Canada's reversal




The Bank of Canada earlier this week withdrew its longstanding warning that the overnight rate was headed upward. But the central bank may still be behind the curve: an argument can be made that it should have already cut its lending rate by this stage.




Consider economic conditions over the past year or so. In particular, annual inflation has been hovering near 1%, the lower boundary of the bank`s inflation target. On this basis, one would think there has long been adequate justification for trimming the bank rate to make sure inflation doesn`t fall below the minimum required by policy guidelines.





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[Ally]

Canada's deficit shrinking fast





The Harper government will balance the budget in 2015 despite slow growth, says Canada`s budget watchdog.



The latest fiscal and economic report card from the parliamentary budget officer shows the surplus in 2015 and 2016 will be a razor-thin $200 million, lower than the March budget estimate of $800 million.





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[Ally]

Tight commercial inventory levels impede sales activity in most major Canadian markets




KELOWNA, BC, Oct. 29, 2013 /CNW/ - While unprecedented levels of demand have been reported for commercial real estate in key Canadian markets this year, a shortage of available product continues to hamper sales activity virtually across the board, according to a report released today by RE/MAX.





Read the full article here.

 

[Ally]

Analysis: Low rate pledge seen recharging Canada's housing boom




Canada sidestepped the worst of the financial crisis because it avoided the real estate excesses of its U.S. neighbor, and a post-recession housing boom helped it recover more quickly than its Group of Seven peers.





But the housing market began to cool last year after the country's Conservative government, worried about a potential property bubble, tightened mortgage rules.





The prospect of lower-for-longer interest rates, needed to help a struggling economy, has revived those bubble fears.





Read the full article here.

 

[Ally]

Nearly a quarter of Canadians are debt-free, while others owe more





Almost a quarter of Canadians have shed their personal debt, while others owe more than last year, says a poll released Tuesday.




Twenty-four per cent of Canadians say they eliminated their non-mortgage debt in 2013, compared with 26 per cent in 2012 and 22 per cent in 2011, according a Royal Bank of Canada poll on debt.






Read the full article here.

 

[Ally]

Economists press Flaherty on lack of clear data




One of the concerns that Finance Minister Jim Flaherty heard from economists during a closed-door meeting on Monday is that it's difficult to properly assess the housing market because of a lack of data.





The wide-ranging discussion that Mr. Flaherty held with more than a dozen economists from the private sector focused on macroeconomic forecasts, with the Finance Minister preparing for the federal government's fall economic update.





Read the full article here.

 

[Ally]

Rising bills putting boomers on the breadline




HUGE power and insurance bills are leaving Baby Boomers too broke to pay for doctors` visits, new clothes and dining out, research shows.




The National Seniors analysis of price rises and spending patterns for over-50s shows a generation on the breadline. There are 250,000 over-50s households which are unable to pay bills on time.





Read the full article here.