Time for your cheat sheet on this week’s top stories.
Canadian Real Estate
Canada Orders Federal Workers Back To Office To Bolster Real Estate
The Government of Canada (GoC) is rolling out a “prescribed presence” rule for its employees. During the pandemic, a hybrid model was adopted for some employees, allowing them to work at home and in the office. Many workers took the optional office appearances as a green light to move to distant suburbs, taking their spending with them. The prescribed presence rule will set a 3-day minimum of in-office work, helping to anchor those employees closer to the city. Officially the changes are being made to facilitate “office culture.” In reality, the change was made after corporate and political pressure to reverse the decisions, hoping to bolster real estate in big city downtowns that have hollowed out.
Canada Sees Unemployment Rise To Deep Recession Levels In Big Cities
Canada is seeing unemployment rise at a breakneck speed in big cities. The national unemployment rate climbed 0.2 points to 6.8% in August, higher than observed pre-pandemic. It’s also worse in the 20 largest census metropolitan areas (CMA). For example, Toronto’s rate was 8.0% last month, and it isn’t the worst performing one.
Toronto Real Estate Sales Had The Worst Month In 24 Years, Prices Dropped $15k Over 31 Days
Toronto real estate has seen a flurry of bad data, including existing home sales. The market saw the fewest August sales in the past 24 years, and inventory climb to unusually lofty levels. The weak demand helped to print another sharp drop for prices, with a typical home falling $15k over just 31 days.
Bank of Canada Warns of Excess Supply, Inflation May Slow “Too Much”
Bank of Canada announced a rate cut this week, as most experts widely expected. The details were more surprising though, with the central bank warning that excess supply may help to slow inflation “too much.” With unemployment rising at a breakneck speed, the cost of borrowing could be slashed at a rate much faster than normal.
