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.
(Canadian Real Estate Association)
“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.
According to the Canadian Real Estate Association, Montreal’s average home prices reached $434,200, up 16.6 per cent compared to last January. (Graham Hughes/The Canadian Press)
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.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
Dollarama Inc.’s food aisles may have expanded far beyond sweet treats or piles of gum by the checkout counter in recent years, but its chief executive maintains his company is “not in the grocery business,” even if it’s keeping an eye on the sector.
“It’s just one small part of our store,” Neil Rossy told analysts on a Wednesday call, where he was questioned about the company’s food merchandise and rivals playing in the same space.
“We will keep an eye on all retailers — like all retailers keep an eye on us — to make sure that we’re competitive and we understand what’s out there.”
Over the last decade and as consumers have more recently sought deals, Dollarama’s food merchandise has expanded to include bread and pantry staples like cereal, rice and pasta sold at prices on par or below supermarkets.
However, the competition in the discount segment of the market Dollarama operates in intensified recently when the country’s biggest grocery chain began piloting a new ultra-discount store.
The No Name stores being tested by Loblaw Cos. Ltd. in Windsor, St. Catharines and Brockville, Ont., are billed as 20 per cent cheaper than discount retail competitors including No Frills. The grocery giant is able to offer such cost savings by relying on a smaller store footprint, fewer chilled products and a hearty range of No Name merchandise.
Though Rossy brushed off notions that his company is a supermarket challenger, grocers aren’t off his radar.
“All retailers in Canada are realistic about the fact that everyone is everyone’s competition on any given item or category,” he said.
Rossy declined to reveal how much of the chain’s sales would overlap with Loblaw or the food category, arguing the vast variety of items Dollarama sells is its strength rather than its grocery products alone.
“What makes Dollarama Dollarama is a very wide assortment of different departments that somewhat represent the old five-and-dime local convenience store,” he said.
The breadth of Dollarama’s offerings helped carry the company to a second-quarter profit of $285.9 million, up from $245.8 million in the same quarter last year as its sales rose 7.4 per cent.
The retailer said Wednesday the profit amounted to $1.02 per diluted share for the 13-week period ended July 28, up from 86 cents per diluted share a year earlier.
The period the quarter covers includes the start of summer, when Rossy said the weather was “terrible.”
“The weather got slightly better towards the end of the summer and our sales certainly increased, but not enough to make up for the season’s horrible start,” he said.
Sales totalled $1.56 billion for the quarter, up from $1.46 billion in the same quarter last year.
Comparable store sales, a key metric for retailers, increased 4.7 per cent, while the average transaction was down2.2 per cent and traffic was up seven per cent, RBC analyst Irene Nattel pointed out.
She told investors in a note that the numbers reflect “solid demand as cautious consumers focus on core consumables and everyday essentials.”
Analysts have attributed such behaviour to interest rates that have been slow to drop and high prices of key consumer goods, which are weighing on household budgets.
To cope, many Canadians have spent more time seeking deals, trading down to more affordable brands and forgoing small luxuries they would treat themselves to in better economic times.
“When people feel squeezed, they tend to shy away from discretionary, focus on the basics,” Rossy said. “When people are feeling good about their wallet, they tend to be more lax about the basics and more willing to spend on discretionary.”
The current economic situation has drawn in not just the average Canadian looking to save a buck or two, but also wealthier consumers.
“When the entire economy is feeling slightly squeezed, we get more consumers who might not have to or want to shop at a Dollarama generally or who enjoy shopping at a Dollarama but have the luxury of not having to worry about the price in some other store that they happen to be standing in that has those goods,” Rossy said.
“Well, when times are tougher, they’ll consider the extra five minutes to go to the store next door.”
This report by The Canadian Press was first published Sept. 11, 2024.
TORONTO – The U.S. Consumer Financial Protection Bureau has ordered TD Bank Group to pay US$28 million for repeatedly sharing inaccurate, negative information about its customers to consumer reporting companies.
The agency says TD has to pay US$7.76 million in total to tens of thousands of victims of its illegal actions, along with a US$20 million civil penalty.
It says TD shared information that contained systemic errors about credit card and bank deposit accounts to consumer reporting companies, which can include credit reports as well as screening reports for tenants and employees and other background checks.
CFPB director Rohit Chopra says in a statement that TD threatened the consumer reports of customers with fraudulent information then “barely lifted a finger to fix it,” and that regulators will need to “focus major attention” on TD Bank to change its course.
TD says in a statement it self-identified these issues and proactively worked to improve its practices, and that it is committed to delivering on its responsibilities to its customers.
The bank also faces scrutiny in the U.S. over its anti-money laundering program where it expects to pay more than US$3 billion in monetary penalties to resolve.
This report by The Canadian Press was first published Sept. 11, 2024.
