Wed, April 24, 2024 at 9:35 AM EDT
Business
Canadian home sales, prices hit new highs for January compared to last year – CBC.ca
Canadians didn’t let COVID-19 or a lack of housing supply stop them from flocking to the real estate market in January as they snatched up a record number of homes and shelled out more than they had in previous years.
Sales for the month were up 35.2 per cent compared with a year earlier — and sales for the first month of the year were up two per cent when compared to December, the Canadian Real Estate Association said Tuesday.
The actual national average price of a home sold also soared to a record $621,525 in January, up 22.8 per cent from the same month last year.
CREA said market conditions were pushed to record levels in January because people have held off putting their homes up for sale in the middle of the pandemic, leaving fewer options for people to fight over.
“The buyers and sellers that will in time define the Canadian housing story of 2021 are mostly all still waiting in the wings,” Shaun Cathcart, CREA’s senior economist, said in a statement.
Single family home prices rose 2.6 per cent month-over-month and a robust 17.4 per cent year-over-year, whereas apartment prices advanced by a smaller 0.2 per cent month-over-month and decreased 3.3 per cent year-over-year, TD Economics said in a statement after CREA released its report.
Buyers need boost in supply
However, Cathcart believes the market is unlikely to see a rush of listings until the public heath situation improves and the dreary winter weather subsides.
“The best case scenario would be if we see a lot of sellers who were gun-shy to engage in the market last year making a move this year,” he said.
“A big surge in supply is what so many markets really need this year to get people into the homes they want, and to keep prices from accelerating any more than they already are.”
With sales edging higher and new supply falling considerably in January, the national sales-to-new listings ratio tightened to 90.7 per cent — the highest level on record for the measure by a significant margin.
The previous monthly record was 81.5 per cent, set 19 years ago. The long-term average for the national sales-to-new listings ratio is 54.3 per cent.
Vancouver, Toronto markets still hot
CREA found the Greater Vancouver and the Greater Toronto Area, two of the country’s most active and expensive markets, were heating up very quickly in January.
The average seasonally adjusted price of a home in the GTA was $941,100 and in Vancouver, was just over $1 million.
When the association removed data from both those regions from the $621,525 national price average, it found the average price was slashed by $129,000.
But that doesn’t mean that conditions eased up outside the city centres, said Wins Lai, a Toronto real estate broker.
Cities outside Toronto also in demand
Prices in areas like Vaughan and Markham, Ont., have reached levels she is shocked by.
“Outside of the city in somewhere like Barrie, we are seeing 40 offers on something that’s $750,000, which is insane,” she said.
CREA said year-over-year price increases between 25 and 30 per cent were seen many regions in Ontario including Barrie, Niagara, Grey-Bruce Owen Sound, Huron Perth, Kawartha Lakes, London and St. Thomas, North Bay, Simcoe and Southern Georgian Bay.
However, the largest year-over-year gains — above 30 per cent — were recorded in the Lakelands region of Ontario cottage country, Northumberland Hills, Quinte, Tillsonburg District and Woodstock-Ingersoll.
Urban sprawl and the pandemic are responsible for part of this phenomenon, Lai said.
“People want to be outside of the city, they want to have their own homes and they don’t want to be in elevators,” she said.
Other cities still attractive
While the downtown core may be less attractive because many people are working from home, young professionals and couples are still trying to snatch up homes there and bidding wars on condos are plentiful.
The CREA said January price gains were in the 10 to 15 per cent range in the GTA, Mississauga, Chilliwack, B.C., the Okanagan Valley in B.C., Winnipeg and on Vancouver Island.
Montreal’s average prices reached $434,200, up 16.6 per cent compared to last January.
They rose by as much as 10 per cent in Victoria, Greater Vancouver, Regina and Saskatoon and by about two per cent in Calgary and Edmonton.
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Business
Oil Firms Doubtful Trans Mountain Pipeline Will Start Full Service by May 1st
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Oil companies planning to ship crude on the expanded Trans Mountain pipeline in Canada are concerned that the project may not begin full service on May 1 but they would be nevertheless obligated to pay tolls from that date.
In a letter to the Canada Energy Regulator (CER), Suncor Energy and other shippers including BP and Marathon Petroleum have expressed doubts that Trans Mountain will start full service on May 1, as previously communicated, Reuters reports.
Trans Mountain Corporation, the government-owned entity that completed the pipeline construction, told Reuters in an email that line fill on the expanded pipeline would be completed in early May.
After a series of delays, cost overruns, and legal challenges, the expanded Trans Mountain oil pipeline will open for business on May 1, the company said early this month.
“The Commencement Date for commercial operation of the expanded system will be May 1, 2024. Trans Mountain anticipates providing service for all contracted volumes in the month of May,” Trans Mountain Corporation said in early April.
The expanded pipeline will triple the capacity of the original pipeline to 890,000 barrels per day (bpd) from 300,000 bpd to carry crude from Alberta’s oil sands to British Columbia on the Pacific Coast.
The Federal Government of Canada bought the Trans Mountain Pipeline Expansion (TMX) from Kinder Morgan back in 2018, together with related pipeline and terminal assets. That cost the federal government $3.3 billion (C$4.5 billion) at the time. Since then, the costs for the expansion of the pipeline have quadrupled to nearly $23 billion (C$30.9 billion).
The expansion project has faced continuous delays over the years. In one of the latest roadblocks in December, the Canadian regulator denied a variance request from the project developer to move a small section of the pipeline due to challenging drilling conditions.
The company asked the regulator to reconsider its decision, and received on January 12 a conditional approval, avoiding what could have been another two-year delay to start-up.
Business
Tesla profits cut in half as demand falls
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Tesla profits slump by more than a half
Tesla has announced its profits fell sharply in the first three months of the year to $1.13bn (£910m), compared with $2.51bn in 2023.
It caps a difficult period for the electric vehicle (EV) maker, which – faced with falling sales – has announced thousands of job cuts.
Boss Elon Musk remains bullish about its prospects, telling investors the launch of new models would be brought forward.
Its share price has risen but analysts say it continues to face significant challenges, including from lower-cost rivals.
The company has suffered from falling demand and competition from cheaper Chinese imports which has led its stock price to collapse by 43% over 2024.
Figures for the first quarter of 2024 revealed revenues of $21.3bn, down on analysts’ predictions of just over $22bn.
But the decision by Tesla to bring forward the launch of new models from the second half of 2025 boosted its shares by nearly 12.5% in after-hours trading.
It did not reveal pricing details for the new vehicles.
However Mr Musk made clear he also grander ambitions, touting Tesla’s AI credentials and plans for self-driving vehicles – even going as far as to say considering it to be just a car company was the “wrong framework.”
“If somebody doesn’t believe Tesla is going to solve autonomy I think they should not be an investor,” he said.
Such sentiments have been questioned by analysts though, with Deutsche Bank saying driverless cars face “technological, regulatory and operational challenges.”
Some investors have called for the company to instead focus on releasing a lower price, mass-market EV.
However, Tesla has already been on a charm offensive, trying to win over new customers by dropping its prices in a series of markets in the face of falling sales.
It also said its situation was not unique.
“Global EV sales continue to be under pressure as many carmakers prioritize hybrids over EVs,” it said.
Despite plans to bring forward new models originally planned for next year the firm is cutting its workforce.
Tesla said it would lose 3,332 jobs in California and 2,688 positions in Texas, starting mid-June.
The cuts in Texas represent 12% of Tesla’s total workforce of almost 23,000 in the area where its gigafactory and headquarters are located.
However, Mr Musk sought to downplay the move.
“Tesla has now created over 30,000 manufacturing jobs in California!” he said in a post on his social media platform X, formerly Twitter, on Tuesday.
Another 285 jobs will be lost in New York.
Tesla’s total workforce stood at more than 140,000 late last year, up from around 100,000 at the end of 2021, according to the company’s filings with US regulators.
Musk’s salary
The car firm is also facing other issues, with a struggle over Mr Musk’s compensation still raging on.
On Wednesday, Tesla asked shareholders to vote for a proposal to accept Mr Musk’s compensation package – once valued at $56bn – which had been rejected by a Delaware judge.
The judge found Tesla’s directors had breached their fiduciary duty to the firm by awarding Mr Musk the pay-out.
Due to the fall in Tesla’s stock value, the compensation package is now estimated to be around $10bn less – but still greater than the GDP of many countries.
In addition, Tesla wants its shareholders to agree to the firm being moved from Delaware to Texas – which Mr Musk called for after the judge rejected his payday.
Business
Stock market today: Nasdaq futures pop, Tesla surges after earnings with more heavyweights on deck
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Tech stocks rose on Wednesday, outstripping the broader market as investors welcomed Tesla’s (TSLA) cheaper car pledge and waited for the next rush of corporate earnings.
The Nasdaq Composite (^IXIC) rose roughly 0.6%, coming off a sharp closing gain. The S&P 500 (^GSPC) was up 0.2%, continuing a rebound from its longest losing streak of 2024, while the Dow Jones Industrial Average (^DJI) fell 0.1%.
Tesla shares jumped nearly 12% after the EV maker’s vow to speed up the launch of more affordable models eclipsed its quarterly earnings and revenue miss. That cheered up investors worried about growth amid a strategy shift to robotaxis and the planned cancellation of a cheaper model.
The results from the first “Magnificent Seven” to report have intensified the already high hopes for Big Tech earnings, that the megacaps can revive the rally in stocks they powered. The spotlight is now on Meta’s (META) report due after the market close, as the Facebook owner’s shares rose after the Senate voted for a potential ban on rival TikTok. Microsoft (MSFT) and Alphabet (GOOG) next up on Thursday.
Meanwhile, Boeing (BA) reported better than expected first quarter results before the opening bell with a loss per share of $1.13, narrower than the $1.72 estimated by Wall Street. Shares rose about 2% in morning trade.
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