There is an old saying “Be careful what you wish for, lest it come true” or a modern version “or you will get right between the eyes”. Governments and some of the general public that wanted Canadian house prices to slow down, have got their wish, but at what cost? Single detached houses have fallen 12.% of their highs, West Vancouver prices are down 14%, condos are down 4.5% since last year but the biggest impact will be government revenues and mortgages. As home sales have fallen significantly, the property transfer taxes will have dropped significantly as well, the provincial government will have a tough time replacing the void. Mortgage business has fallen to a 17-year low in Canada, which is a main revenue driver at Canada’s banks, residential mortgage growth rose 3.1 percent to C$1.55 trillion ($1.18 trillion) in December from a year earlier, the slowest pace since May 2001, and half the growth rate from two years ago, according to data from the Bank of Canada. Canadian bank executives are on record that they expect slow growth for this year and probably next year, but remember this, they will find ways to supplement the slow mortgage growth, watch your fees in the next few months.
Currently Close Range
USDCAD 1.3135 1.3110 1.3102-1.3153
EURCAD 1.4985 1.4994 1.4959-1.5008
GBPCAD 1.7003 1.7091 1.6985-1.7116
US: ISM Non-Mfg Index January 58.0 56.7