Canadian real GDP grew 0.2 per cent in May, following a 0.3 per cent increase in April. The growth was driven by goods-producing industries (+0.4 per cent), in which 4 of 5 sectors grew, led by manufacturing (+1 percent) and agriculture, forestry, fishing and hunting (+0.9 percent). However, the mining, quarrying, and oil and gas extraction sector contracted by 0.6 per cent in May, entirely driven by a 2.1 per cent decrease in the oil and gas extraction subsector. Service producing industries grew by 0.1 per cent, with both retail trade and wholesale trade contracting by 0.9 per cent and 0.8 percent, respectively. Finally, the GDP for the offices of real estate agents and brokers grew by 0.17 per cent in May. Preliminary estimates suggest that output in the Canadian economy grew by 0.1 per cent in June, as well as about 2 per cent in the second quarter of 2024, on an annualized basis.

BCREA estimates that the B.C. economy grew by 1.4 per cent year-over-year in May. This slightly outpaces the 1.1 per cent year-over-year growth for the Canadian economy. To see the full details of our Nowcast, click here: https://infogram.com/bcrea-nowcast-for-may-2024-and-june-2024-prelim-july-31-2024-1h0n25ok1n5kl4p?live

Canada's economy expanded at a reasonable rate that matched analyst expectations in May, following the anticipated 25 basis point cut from the Bank of Canada last week. Amidst weakening labour markets and relatively flat inflation levels over the second quarter, this report is unlikely to deter the Bank of Canada from pursuing a gradual decline in the overnight rate throughout the rest of 2024 and into 2025. However, they will be watching next month’s CPI and jobs report to determine whether market expectations changed following their first cut. 

https://mailchi.mp/bcrea/monthly-economic-growth-may-2024

For more information, please contact: Gino Pezzani.

About BCREA’s Housing Monitor Dashboard

The BCREA Economics team has created the Housing Monitor Dashboard to help REALTORS^® monitor BC’s housing market. This dashboard, which is updated monthly, provides up-to-date data on key variables for public education and use. Focuses include: 

• Resale Home Market

• Construction

• Rental Market

• Borrowing Costs

• Other BCREA Data

In the dashboard, the image and data are available for download under each chart, where possible.

For more information, please contact: Gino Pezzani.

Canadian prices, as measured by the Consumer Price Index (CPI), rose 2.7 per cent on a year-over-year basis in June, down from a 2.9 per cent increase in May. Month-over-month, on a seasonally adjusted basis, CPI rose by 0.1 per cent in June. The deceleration in headline CPI was largely driven by declining gasoline prices. Excluding gasoline, the CPI rose 2.8 per cent in June. The shelter cost index remains the major driver of inflation with the rate of increases higher now (6.2 per cent) than they were this time last year (4.8 per cent). Mortgage interest costs were up 22.3 per cent and rent was up 8.8 per cent from last June. Excluding shelter, consumer prices rose just 1.3 per cent, year over year. Driven by furniture and used cars, durable goods costs fell 1.8 per cent year-over-year in June as supply chains continue to recover. In BC, consumer prices rose 2.6 per cent year-over-year, down from 2.9 per cent in May. The Bank of Canada's preferred measures of core inflation, which strip out volatile components, fell to between 2.3 and 2.9 per cent per cent year-over-year in June.

Canada's inflation report contained some good news mixed in with familiar challenges. The headline year-over-year price change declined in June, reversing May's uptick, and came close to the lowest rate since early 2021. This was achieved in part due to 3.1 per cent month-over-month decline in gasoline prices following an announcement from the Organization of the Petroleum Exporting Countries (OPEC) that it plans to increase production. On the other hand, the year-over-year change in food costs rose for a second consecutive month, halting an optimistic downward trend. CPI-median and CPI-trim are back above the 2 per cent target when measured on a 3-month annualized basis for the second consecutive month. Finally, shelter costs and especially rents remain the most persistent challenge in the CPI and show few clear signs of improvement. Taken together, however, markets considered the report positive news and raised the probability that the Bank of Canada would cut rates next Wednesday to 90 per cent. 

For more information, please contact: Gino Pezzani.

Link: https://mailchi.mp/bcrea/canadian-inflation-june-2024-july-16-2024

Canadian housing starts fell 9 per cent to 241,672 units in June at a seasonally adjusted annual rate (SAAR). Starts were down 14 per cent from the same month last year. Single-detached housing starts were up 1 per cent from last month at 52,762 units, while multi-family and others fell 11 per cent to 188,911 units (SAAR).

In British Columbia, starts fell 12 per cent from last month to 40,808 units SAAR in all areas of the province. In areas in the province with 10,000 or more residents, single-detached starts rose 11 per cent to 4,876 units while multi-family starts dropped 15 per cent to 34,085 units. Starts in the province were 38 per cent below the levels from June 2023. Compared with last year, year-to-date starts were up by 5 per cent in Victoria, 54 per cent in Kelowna, and 27 per cent in Abbotsford. Year-to-date starts were down by 18 per cent in Vancouver and by 20 per cent in Nanaimo. 

Link:https://mailchi.mp/bcrea/housing-starts-june-2024

For more information, please contact: Gino Pezzani.

Vancouver, BC – July, 2024

The British Columbia Real Estate Association (BCREA) reports that 7,082 residential unit sales were recorded in Multiple Listing Service^® (MLS^®) systems in June 2024, a 19 per cent decrease from June 2023. The average MLS^® residential price in BC in June 2024 was up 1 per cent at $998,159 compared to an average price of $988,632 in June 2023. The total sales dollar volume was $7.1 billion, an 18 per cent decline from the same time the previous year.  BC MLS^® unit sales were 24 per cent lower than the ten-year average for June. 

“Sales activity in June was much softer than the same time last year, with June of 2023 representing the market peak following last summer’s pause in rate hikes,” said BCREA Chief Economist Brendon Ogmundson. “However, both sales and active listings continue to gradually inch upwards, keeping the market in balanced territory.”

Year-to-date, BC residential sales dollar volume was down 2 per cent to $38.6 billion, compared with the same period in 2023. Residential unit sales were down by 4.1 per cent year-over-year at 38,639 units, while the average MLS^® residential price was up 2.3 per cent to $997,883. 

For more information, please contact: Gino Pezzani.

Metro Vancouver home sales registered on the Multiple Listing Service® (MLS®) remained below seasonal and historical averages in June, with inventory reaching levels not seen since the spring of 2019.

Here's a summary of the June 2024 housing market statistics.

Looking for the full story? Get the June 2024 Monthly Market Report by going to the Market Matters section of this site.

For more information, please contact: Gino Pezzani.

At a glance (3 minute read)

• BC landlords must use the Landlord Use Web Portal to create personal or caretaker use eviction notices starting July 18, 2024 and must include information on who is moving in.

• Other changes to the personal or caretaker use eviction rules include a four-month notice period, 30-day dispute window, mandatory 12-month occupancy, and higher penalties for bad-faith evictions.

• The portal aims to protect tenants from false evictions and provide a transparent process, with data used for better regulation and support for renters and landlords

For more information, please contact: Gino Pezzani

The link:New eviction rules: Landlords required to use new website to create personal-use eviction notices, and more (gvrealtors.ca)

Canadian employment was largely unchanged from the previous month, contracting by just 1,400 jobs, to 20.516 million in June. The unemployment rate rose by 0.2 points to 6.4 per cent, the fifth consecutive monthly increase, and up 1 point from this time last year. Average hourly wages rose 5.4 per cent year-over-year to $34.91 last month, while total hours worked were up 1.1 per cent from June of last year.

Employment in BC fell 0.3 per cent to 2.854 million, while employment in Metro Vancouver fell 1.2 per cent to 1.591 million in June. The unemployment rate fell 0.4 points in BC to 5.2 per cent while falling in Metro Vancouver by 0.7 points to 5.4 per cent last month. 

Link: https://mailchi.mp/bcrea/canadian-employment-june-2024-july-5th-2024

For more information, please contact: Gino Pezzani.