Canadian GDP rose 0.3 per cent in April, led by growth in the mining, quarrying, and oil and gas sector. Goods-producing sectors rose 0.9 per cent while services-producing industries were up 0.1 per cent. Canadian real GDP is roughly 2.2 per cent above its pre-pandemic, February 2020 level. Preliminary estimates suggest that output in the Canadian economy shrank 0.2 per cent in May.

The Canadian economy continues to post relatively strong GDP growth numbers, although preliminary estimates are for a small contraction in May. The Bank of Canada has noted that the slack in the Canadian economy is absorbed, which is partly why it has hiked rates from 0.25 in March to 1.5 per cent currently. Amid continuing GDP growth and high inflation, the expectation is that the bank will again raise rates at its upcoming July 13th announcement by an outsized 0.75 per cent, following the US Fed. Our view is that the bank will continue quarterly rate hikes until the overnight policy rate reaches 2 to 3 per cent, roughly in line with the estimate of the neutral rate of interest. 


Link:  https://mailchi.mp/bcrea/canadian-economic-growth-real-gdp-april-2022

For more information, please contact: Gino Pezzani.

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In BC in May, home sales declined, while starts and new listings ticked upwards modestly. Sales fell in all areas of the province except for in the Northern region, where sales were up slightly. Rental costs in Vancouver and Victoria continue to rise and remain elevated relative to most other points since the onset of the pandemic.

Retail sales rose in April to a new record. As of June, restaurant reservations in Vancouver are essentially at their pre-pandemic level. In BC, Google’s measure of movement trends is currently just 3 per cent below pre-pandemic levels.

Although aggregate employment has recovered in BC to pre-pandemic levels, the accommodation and food service sector was about 10 per cent below the pre-pandemic level in May. The labour market has served high-income workers much better than low-income workers. Employment in high-income industries is about 10 per cent above pre-pandemic employment levels, while employment in low-income industries is about 3 per cent below pre-pandemic employment levels.

Exports and imports both rose to a fresh record in April, while manufacturing declined slightly off its record level. Business and consumer confidence retreated in May, likely on trepidations related to higher inflation expectations and elevated fuel prices.

The number of US and non-US tourists in BC rose in April, with both US and non-US tourists reaching the highest level since the onset of the pandemic.

For a more comprehensive overview of BC's economic recovery, click here.

BCREA's updated COVID-19 Recovery Dashboard is available here

For more information, please contact: Gino Pezzani.

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Vancouver, B.C. – June, 2022 – Coming off near-record activity in 2021, the Lower Mainland’s commercial real estate market saw a steady pace of sales in the first quarter (Q1) of 2022.

There were 595 commercial real estate sales in the Lower Mainland in Q1 2022, a one per cent decrease from the 601 sales in Q1 2021, according to data from Commercial Edge, a commercial real estate system operated by the Real Estate Board of Greater Vancouver (REBGV).

The total dollar value of commercial real estate sales in the Lower Mainland was $3.718 billion in Q1 2022, a 32.9 per cent increase from $2.798 billion in Q1 2021.

“Strong economic growth and low interest rates helped keep the Lower Mainland's commercial real estate market moving briskly in 2021, and this momentum carried into the first quarter of 2022," said Daniel John, Chair, REBGV. "Raw land was the most popular and expensive commercial category driving activity to begin the year as companies look for space to expand and pursue their commercial ventures in the region.

“Going forward, we’ll need to see how the rising interest rates and inflationary pressure that we’re experiencing today will impact our commercial real estate market for the balance of 2022.”

Q1 2022 activity by category

Land: There were 206 commercial land sales in Q1 2022, which is a 63.5 per cent increase from the 126 land sales in Q1 2021. The dollar value of land sales was $2.085 billion in Q1 2022, a 177.5 per cent increase from $752 million in Q1 2021.

Office and Retail: There were 219 office and retail sales in the Lower Mainland in Q1 2022, which is down 6.8 per cent from the 235 sales in Q1 2021. The dollar value of office and retail sales was $624 million in Q1 2022, a 29.7 per cent decrease from $887 million in Q1 2021.

Industrial: There were 141 industrial land sales in the Lower Mainland in Q1 2022, which is a 28.8 per cent decrease from the 198 sales in Q1 2021. The dollar value of industrial sales was $673 million in Q1 2022, a two per cent increase from $660 million in Q1 2021.

Multi-Family: There were 29 multi-family land sales in the Lower Mainland in Q1 2022, which is down 31 per cent from 42 sales in Q1 2021. The dollar value of multi-family sales was $336 million in Q1 2022, a 32.7 per cent decrease from $499 million in Q1 2021.

For more information, please contact: Gino Pezzani.

Link: CommercialEdge Sales Stats 1 - LowerMainland - 2022 Q1

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Canadian prices, as measured by the Consumer Price Index (CPI), rose 7.7 per cent on a year-over-year basis in May, up from 6.8 per cent last month. This was the fastest growth rate since January 1983. According to Statistics Canada, price rises were broad-based, with groceries up 9.7 per cent year-over-year, gasoline up 48 per cent, and shelter costs up 7.4 per cent. Excluding gasoline, the CPI rose 6.3 per cent year over year in May. Month-over-month, on a seasonally-adjusted basis, prices were up 1.1 per cent, the fastest pace since the introduction of the series in 1992. In BC, consumer prices rose 8.1 per cent year-over-year. Average hourly wages grew 3.9 per cent year-over-year in May, indicating a decline in purchasing power. 

A steep trajectory for the overnight rate implies that the 5-year fixed mortgage rate could reach the 5 per cent level for the first time since 2009 while variable mortgage rates may rise to as high as 4.5 per cent. With the stress test for both insured and uninsured borrowers, prospective homebuyers are currently being qualified at a rate of 6.49 per cent with a strong possibility of qualifying at 7 per cent soon, a rate that has not been a reality in the Canadian mortgage market since the early 2000s.

Given how aggressive markets expect the Bank of Canada to be, any good news on inflation, or any significant deterioration in the Canadian economy, could see a significant reversal in the most recent jump in Canadian bond yields. However, the baseline case for now is a Bank of Canada that is single-minded in its pursuit of lower inflation.

Link: https://mailchi.mp/bcrea/canadian-inflation-may-2022

For more information, please contact: Gino Pezzani.

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Canadian seasonally-adjusted retail sales increased 0.9 per cent in April, hitting $60.7 billion. Sales grew in 6 of 11 subsectors, but were led by higher sales at general merchandise stores (+4.2 per cent). Core retail sales, which strips out gasoline and motor vehicle and parts dealers, increased 1 per cent in April. In volume terms, sales were up 0.9 per cent. 

In BC, seasonally-adjusted sales rose 1.3 per cent in April. Compared to the same month last year, retail sales were up 0.6 per cent in the province. In the Greater Vancouver region, sales rose 1 per cent month-over-month and were up 4.2 per cent year-over-year. 

In April, Canadian e-commerce sales rose 7 per cent to 3.3 billion, corresponding to 5.2 per cent of retail sales. This percentage remains elevated relative to pre-pandemic levels. 

Link:  https://mailchi.mp/bcrea/canadian-retail-sales-april-2022

For more information, please contact: Gino Pezzani.

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Canadian housing starts rose by 21.5k (8.1 per cent) to 287.3k units in May at a seasonally-adjusted annual rate (SAAR). Comparing year-over-year, starts were up from May of 2021 (1.2 per cent). Single-detached housing starts declined 3.1 per cent to 78.9k, while multi-family and others rose 13.1 per cent to 208.4k (SAAR). 

In British Columbia, starts declined 22.7 per cent in May, falling to 40.2k units SAAR in all areas of the province. In areas in the province with 10,000 or more residents, single-detached starts declined 13.8 per cent m/m to 8.1k units while multi-family starts fell 26.1 per cent to 29.6k units. Starts in the province were 13.7 per cent above the levels from May 2021. Starts were down by 6.4k units in Vancouver, 1.2k in Kelowna, and 1.4k in Abbotsford from last month, while rising by just over 100 in Victoria. The 6-month moving average trend rose 0.3 per cent to 42.4k in BC in May. 




Link: https://mailchi.mp/bcrea/canadian-housing-starts-may-2022

For more information, please contact: Gino Pezzani.

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For the complete news release, including detailed statistics, click here.

Vancouver, BC – June, 2022. The British Columbia Real Estate Association (BCREA) reports that a total of 8,214 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in May 2022, a decrease of 35.1 per cent from May 2021. The average MLS® residential price in BC was $1 million, a 9.3 per cent increase from $915,392 recorded in May 2021. Total sales dollar volume was $8.2 billion, a 29.1 per cent decline from the same time last year. 


“Canadian mortgage rates continue to climb,” said BCREA Chief Economist Brendon Ogmundson. “The average 5-year fixed mortgage rate reached 4.49 per cent in June. That is the highest mortgage rates have been since 2009.”

Provincial active listings were 4.4 per cent higher than this time last year, the first year-over-year increase in active listings since 2019. However, active listings still remain below what is typical for a balanced market, though current market conditions have a high degree of variation across regions and product types.

Year-to-date, BC residential sales dollar volume was down 14.5 per cent to $46.7 billion, compared with the same period in 2021. Residential unit sales were down 26.3 per cent to 43,921 units, while the average MLS® residential price was up 16 per cent to $1.06 million.


For more information, please contact: Gino Pezzani.

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Canadian employment edged up by 39,800 to 19.64 million in May. The labour market continued to tighten, with the Canadian unemployment rate declining by 0.1 to 5.1 per cent, the lowest rate on record for a second consecutive month. Average hourly wages were up 3.9 per cent on a year-over-year basis, increasing from April's 3.3 per cent. Wage gains are below the inflation rate, however, which hit 6.8 per cent year-over-year in the most-recent data. The employment rate held steady at 61.9 per cent.

Employment in BC grew by 5.1k to 2.74 million in May. Metro Vancouver's employment grew by 7.1k (0.5 per cent) month over month. The unemployment rate declined sharply in May to 4.5 per cent, approaching record lows set in the mid 2000s. Of the provinces, only Quebec currently has a lower unemployment rate. 



Link: https://mailchi.mp/bcrea/canadian-employment-may-2022

For more information, please contact: Gino Pezzani.

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To view the full Commercial Leading Indicator PDF, click here.   

The BCREA Commercial Leading Indicator (CLI) rose to 154 from 150 in the first quarter of 2022, recovering most of the ground lost over the prior two quarters. Compared to the same time in 2021, the index was up by 3.4 per cent. 

It is important to note that while the Canadian economy generally continues to recover strongly, the environment for commercial real estate remains highly abnormal and uncertain. Although the CLI was designed to interpret economic and office employment growth as positive indicators for commercial real estate demand, the recent strong growth of these indicators may not translate as readily into improved conditions in the commercial real estate market relative to the pre-pandemic period. 

The CLI rose in the first quarter almost entirely due to improvements in the economic activity component of the index, while the financial component contributed only slightly and the employment component was essentially flat. The economic activity index was driven upwards by rising wholesale trade and manufacturing sales, whereas retail sales, although historically elevated, were largely flat from the prior quarter. Improving manufacturing sales were concentrated among non-durable goods such as food and beverages, whereas wholesale trade was especially strong for building and machinery materials as the province continues to experience a boom in the number of projects under construction. Although COVID-19 lockdowns have eased, supply chain obstacles and the war in Ukraine continue to generate instability and rising prices which contributed to rising sales figures. 

The small increase in the financial component of the index was driven by a decrease in the spread between government and corporate borrowing rates. This spread on 3-month bonds fell from 18 to 10 basis points in the first quarter amid generally rising bond yields. The spread is important as it indicates the ease with which the private sector can borrow relative to government, which is a driver of commercial real estate activity. REIT prices fell slightly since last quarter, which dampened the financial component of the index. Finally, the employment component of the index was essentially flat with a four thousand job decline in manufacturing employment completely offsetting an equivalent increase in office (finance, insurance, and real estate) employment.

For more information, please contact: Gino Pezzani.

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The data relating to real estate on this website comes in part from the MLS® Reciprocity program of either the Real Estate Board of Greater Vancouver (REBGV), the Fraser Valley Real Estate Board (FVREB) or the Chilliwack and District Real Estate Board (CADREB). Real estate listings held by participating real estate firms are marked with the MLS® logo and detailed information about the listing includes the name of the listing agent. This representation is based in whole or part on data generated by either the REBGV, the FVREB or the CADREB which assumes no responsibility for its accuracy. The materials contained on this page may not be reproduced without the express written consent of either the REBGV, the FVREB or the CADREB.