A new report from TD says Canadian home sales could fall by nearly one-quarter on average this year and remain low into 2023.
The report, prepared by TD Economics and published Wednesday, says the bank has “significantly” downgraded its home sales and price forecasts compared to March “as monetary policy has tightened more acutely than anticipated.”
TD Economics expects increased borrowing costs to “weigh heavily on housing activity,” with the peak-to-trough decline, or the highest and lowest points in the business cycle, between the first quarters of 2022 and 2023 reaching 33 per cent.
Housing activity should begin to “firm” beyond that, the report says, but remain low as interest rates drop.
This will result in a 23 per cent annual average decline in Canadian home sales in 2022, before pulling back to an 11.9 per cent average decline in 2023.
Average home prices in Canada between the first quarters of 2022 and 2023 also should fall due to cooler demand, with TD Economics projecting a peak-to-trough decline of 19 per cent followed by modest growth.
The report comes following a series of interest rate hikes by the Bank of Canada amid record inflation.
The bank hiked its key interest rate by 50 basis points, or half a percentage point, to 1.5 per cent in June.
The TD Economics report says it expects the key interest rate to hit 3.25 per cent by the fourth quarter of this year.
Deputy governor of the Bank of Canada Paul Beaudry said last month the key interest rate could rise above the previous target of three per cent.
The TD Economics report also breaks down average annual growth and decline in home sales and prices by province, with B.C. and Ontario expected to see some of the largest decreases in 2022 and 2023, which TD Economics says is a reflection of “significant affordability deteriorations during the pandemic.”
Quebec will see similar modest price growth, with sales in Alberta expected to “retrench significantly from their record highs,” but remain closer to pre-pandemic levels through 2023 compared to B.C. and Ontario.
“Prices should hold up better elsewhere in Canada, with the best affordability conditions in the country cushioning other markets in the Prairies and Newfoundland and Labrador,” the report says.
“Strong population growth and tight conditions should offer near-term price support to the rest of the Atlantic, although activity in this region should cool as rates ratchet higher.”
A report published last month by Desjardins suggested housing prices in Canada could fall by 15 per cent to approximately $675,000 in December 2023, down from their peak of just over $790,000 on average in February 2022.
Despite this, Desjardins says $675,000 is still nearly 30 per cent higher compared to December 2019, when the average home price in Canada was $530,000.
With files from CTV News and The Canadian Press
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Rogers, Shaw formalize planned Freedom sale to Quebecor – BNN Bloomberg
Rogers Communications Inc., Shaw Communications Inc. and Quebecor Inc. announced Friday they reached a definitive agreement for the previously-announced proposed sale of Shaw’s Freedom Mobile wireless business.
The three companies said that the terms of the definitive pact are “substantially consistent” with their original announcement on June 17, when they said Montreal-based Quebecor agreed to pay $2.85 billion to purchase Freedom. Originally, July 15 was the target to reach the definitive agreement.
“We are very pleased with this agreement, and we are determined to continue building on Freedom’s assets,” said Quebecor president and chief executive officer Pierre Karl Péladeau in a release Friday. “Quebecor has shown that it is the best player to create real competition and disrupt the market.”
The transaction is conditional on Rogers receiving final regulatory approvals for its planned $20-billion takeover of Shaw, which was announced in March 2021.
The road to regulatory approval has become more treacherous for Rogers after Competition Commissioner Matthew Boswell stated his objections to the plan, warning it would diminish competition in the telecom market, notwithstanding Rogers’ long-stated intent to divest Freedom Mobile.
Rogers’ legal counsel has argued vociferously against Boswell’s claims, saying in a June 3 filing with the Competition Tribunal that Boswell’s stance “is unreasonable, contrary to both the economic and fact evidence presented to the Bureau, and not supportable at law.”
The Competition Tribunal is currently scheduled to begin a hearing on the matter Nov. 7.
Rogers also has to clear another regulatory hurdle: its planned acquisition of Shaw requires approval from Innovation, Science and Industry Minister François-Philippe Champagne, who has previously said he won’t allow the wholesale transfer of Shaw’s wireless assets to Rogers.
The process became more complicated for Rogers after a national network outage knocked out service to its customers in early July.
Champagne subsequently said the outage would “certainly be in [his] mind” when weighing the merit of the Shaw sale.
For its part, the Canadian Radio-television and Telecommunications Communications announced its conditional approval of the transaction in March.
Shaw investors have consistently demonstrated skepticism that the deal will go ahead as planned, as evidenced by its shares never once attaining the $40.50-per-share takeover offer from Rogers since the takeover was announced last year.
Power has been restored after downtown Toronto outage, Hydro One says – The Globe and Mail
Hydro One said power has been restored in Toronto after an outage in the city’s downtown core on Thursday that lasted nearly eight hours and affected about 10,000 customers.
Toronto Hydro said the outage, which began at approximately 12:30 p.m., affected an area stretching from just south of Bloor Street to the edge of the waterfront, and as far west as University Avenue to the Don Valley Parkway in the east.
“Safety is always our top priority. We know this power outage has made today exceptionally difficult for many of you, and we appreciate your patience,” said David Lebeter, chief operating officer of Hydro One in a Thursday evening statement.
“We had all available resources helping to restore power as quickly and safely as possible. I want to thank all of those affected by this outage for their patience and Toronto Fire and Toronto Hydro for their collaboration.”
The cause of the outage was confirmed to be a barge carrying a crane that had struck a critical high-voltage power line in city’s Port Lands district, Hydro One confirmed in a statement Thursday evening.
Hydro One spokesperson Tiziana Baccega Rosa initially said the company was investigating a crane accident as a possible cause, after videos of the barge hitting the power lines was posted to social media.
Toronto Fire District Chief Stephan Powell also confirmed the incident and said that fire services were attending to the scene and had cordoned off a significant portion of the area, noting that the power lines fell into the water and the area remained dangerous.
No injuries have been reported, but Mr. Powell said that fire services responded to a high number of people trapped in elevators related to the power outage. Federal Minister of Immigration Sean Fraser tweeted a picture of himself trapped in an elevator with three others, calling it “terrible timing.”
Jennifer Stranges, spokesperson for Unity Health Toronto, said St. Michael’s Hospital is operating as normal but was affected by the outage and was relying on backup power systems to maintain patient care.
“Patients with scheduled appointments or who need to visit our emergency department should continue to come to the hospital for care. Our teams have worked quickly to respond to this issue and we thank them for their continued efforts,” Ms. Stranges said in an e-mail.
Gillian Howard, vice-president of communications for University Health Network, said the outage also affected Toronto General Hospital, which is on the corner of University Avenue and Elizabeth Street. Ms. Howard said the hospital was operating on normal power, but required emergency backup power for around a half hour. She also noted that none of UHN’s facilities on the west side of University Avenue were affected, such as Mount Sinai Hospital or the Princess Margaret Cancer Centre.
The outage caused general frustration for residents around the downtown core as entire blocks remained without power, halting business and creating traffic jams as intersections became four-way stops. In a reminder of the nationwide Rogers outage in July, stores put up signs turning customers away due to a lack of functioning payment systems and an inability to use any appliances. Some people also complained of being unable to access high-speed cellular services like data and 5G networks.
The billboard-laden Yonge-Dundas Square and the Eaton Centre were also affected, the latter of which had its power restored and reopened to shoppers in the midafternoon. Other high-traffic locations, such as St. Lawrence Market, remained closed for the duration of the outage.
The city confirmed city hall and other government buildings in the affected area were also without power or operating on emergency systems.
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