Time for your cheat sheet on this week’s top stories.
Canada Is Killing Work-From-Home & It’s Bad News For Small City Real Estate
Canadians embraced work-from-home almost immediately in 2020, especially in government. It was branded the “new normal,” which workers took as a cue to move into distant suburbs, breathing new life into stagnating regions. That move came at the expense of pricey cities, which saw demand plummet and busy downtown cores hollow out. Policymakers are now trying to reverse that flow with mandatory office minimums, anchoring workers downtown. It might be good news for busy cities, if employees don’t lose the spending to shelter costs, but it’s definitely bad news for small cities positioned to lose their recent windfall.
Canadian Real Estate Fueling Productivity Crisis, Quality of Life To Erode: TD
One of Canada’s largest banks is warning the productivity crisis is a bigger problem than most realize. Economists from TD note the lack of productivity will result in an erosion of quality of life, especially when it comes to government services. They attribute the decline to many reasons, but the biggest were residential real estate and taxation. TD is now a part of a growing group, which includes the Bank of Canada and OECD, that are warning it will take decades for Canada to correct course after a decade of poor decisions.
Canadian Young Adults Face Soaring Unemployment & Unaffordable Housing: BMO
Canadian recession fears have already become a reality for young adults. A new report from BMO explores a surge in youth employment (15 to 24 years old). The gap between youth unemployment and core-age workers is now at a level typically only seen during a deep recession. The bank further warns that young adults face the “gruesome twosome,” a combination of rising unemployment and a lack of affordable shelter. It’s an ominous setup for the economy, which isn’t as optimistic looking as it was just a few years ago.
Canada Post Non-Operational Staff Told To Return To Office Next Month
Canada’s remote work culture suffered another setback this week, as another major employer returns to the office. Canada Post is asking all of its non-operational (office) staff back to the office for a minimum of two days per week starting October 15th. Two days per week may not sound like much, but it’s just enough to anchor workers to expensive big cities. That seems to be a trend, as government employers mandate a return to office following corporate and political pressure. Policymakers are hoping to revive the downtowns that hollowed out when remote work became common, and reverse the declining demand to be in expensive, big cities.
Canada Saw The Share of Households Struggling To Make Ends Meet Jump 50%
Canadian households are increasingly struggling to make ends meet, and it’s not just the cost of housing. Statistics Canada (Stat Can) data shows the share of households struggling to pay their bills climbed to 31% of households in 2022, an increase of more than 50% from a year prior. Housing costs play a large role here, as the highest concentration of those struggling were renters. However, that wasn’t the sole issue—the demographic with the fastest growth of struggling households was those who owned a home with no mortgage. Even the surge in home values wasn’t enough to stave off the rising cost of living nationwide.
Vancouver Real Estate Prices Slip As Sales Fall 26% Below 10-Year Average
Greater Vancouver real estate prices slipped as demand fell to historically weak levels. Home prices in the region have been relatively resilient in contrast to markets like Toronto, falling only a few points from peak. However, the correction may not be over for the region, which reported August sales as 26% below the 10-year average for the month. At the same time, inventory is climbing to a rarely seen level in a market that’s notoriously scarce.
