This month’s COVID-19 Recovery Dashboard shows record home sales across the province along with a jump in housing starts and a continued rise in new listings. Employment in some sectors, especially high-wage sectors is showing strong growth, but restrictions due to the third wave and hesitancy from the public is still keeping employment in the accommodation and food service sector depressed. Retail sales were flat in February, though from a high level in January and are up double digits compared to the same time last year. For a more comprehensive overview of BC's economic recovery, click here.
About BCREA’s COVID-19 Recovery Dashboard The BCREA Economics team has created the COVID-19 Recovery
Canadian Retail Sales (February 2021) - April 28, 2021
Canadian retail sales rose 4.8% m/m on a seasonally-adjusted basis in February. Sales were higher in 9 of 11 sub-sectors, led by higher sales at motor-vehicle and parts dealers as well as gas stations. Excluding motor-vehicles and gasoline, retail sales were up 3.8% in February. Statistics Canada also released a preliminary estimate for March showing retail sales increased 2.3%.
In BC, seasonally-adjusted retail sales were down 0.1% m/m but were up 1.8% m/m in Vancouver. On a non-seasonally adjusted basis, BC retail sales were up by 12% compared to the same time last year.
In February Canadian e-commerce sales rose 92% year-over-year to $3.1 billion, accounting for 6.8% of
Bank of Canada Interest Rate Announcement - April 21, 2021
The Bank of Canada maintained its overnight rate at 0.25 per cent this morning, a level it considers its effective lower bound. The Bank reiterated what it calls "extraordinary forward guidance" in committing to leaving the overnight rate at 0.25 per cent until slack in the economy is absorbed and inflation sustainably returns to its 2 per cent target. The Bank is now projecting that will occur in the second half of 2022 rather than in 2023. The Bank is also continuing its quantitative easing (QE) program, though it will be reducing its bond purchases from at least $4 billion of Government of Canada bonds per week down to $3 billion per week. In the statement accompanying the
Canadian housing starts increased 21.6% m/m to 335,200k units in March at a seasonally adjusted annual rate (SAAR), after declining in February. Building activity was up month-over-month in both multi-unit (+34%) and single-detached (+4%) segments. On a year-over-year basis, starts were up 70%, though this measure will become quite distorted by base-year effects going forward as we compare to the start of the COVID-19 pandemic. The six-month moving average in Canadian housing starts stands at a very strong 273,664 units SAAR.
In BC, housing starts increased by 57% m/m to a record high 71.2K units SAAR, following an increase of 21% in the previous month. That remarkable jump in new home
Vancouver, BC – April 13, 2021. The British Columbia Real Estate Association (BCREA) reports that a total of 15,073 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in March 2021, an increase of 123.3 per cent over March 2020 and a new all-time record for monthly BC home sales. The average MLS® residential price in BC was $947,707, a 20.4 per cent increase from $787,032 recorded in March 2020. It should be noted that average prices across the province are being skewed higher as more expensive single-detached homes remain a higher share of dollar volume during the pandemic. Total sales dollar volume was $14.3 billion, a 168.9 per cent increase from last year.
Canadian employment gained 303K jobs in March (1.6%, m/m), bringing total employment to within 1.5% or 296K jobs of its pre-pandemic level from February 2020. Both part-time employment with full-time employment contributed to the gains in March, rising by 128K and 175K jobs respectively. The national unemployment rate decreased by 0.7 percentage points to 7.5%, which is the lowest rate since February 2020.
In BC, employment grew by 35k (+1.3%, m/m) in March. The unemployment rate decreased from held steady at 6.9%, which is the lowest rate the province has recorded since February 2020. Meanwhile, in Vancouver, employment increased by 32.3k (+2.2%,m/m), following a rise of 13.9k in the
The Victoria Real Estate market kept right on trend with the recent era of the covid housing rush, but with a little injection of the spring market. Speaking of “this era” of covid, we are just now heading into the one full year stretch since the beginning of covid, the beginning era having a very different effect on the housing market than our current one. Remember the whole reason for the beginning of this boom was “pent up demand”, well now we are headed into the one year mark from when that demand was being pent up. The outcome of this is that our year-over-year comparisons are going to start to become less meaningful. While March to March is the start of the weird numbers, April 2020 is when there were really low lows.
Inventory in the Vancouver Island Real Estate Board area actually increased and increased significantly (29% up from February for both single-family homes and townhomes), but still sat at record lows overall. Condos did not increase much, with only 2 more listings active at the end of March compared to the end of February in that segment. The breakdown of property type and listings available at the end of March was: Single-family homes had 508 listings, condos had 171 units available, and townhomes came in at 117. While the increases in inventory is a really good sign, we are still deep into a seller’s market and still in the midst of a deeply depressed inventory.
Part of the reason that the seller’s market isn’t going to change quickly is because of
BC Monthly Real GDP Estimate for January 2021 & Preliminary Estimate for February 2021 (Updated: March 31, 2021)
The BCREA Nowcast estimate of provincial economic growth (expressed as year-over-year growth in real GDP) for January 2021 is 1.4 percent. We have also included a preliminary estimate for February 2021 of 2 percent. Because the BCREA Nowcast is a year-over-year measure, we expect to see very large growth in coming months due to base-year effects as strong incoming 2021 data is compared to the lowest point of 2020 during the initial stages of the COVID-19 pandemic.
Canadian Monthly Real GDP Growth (January 2021) - March 31, 2021
It was a strong start for the Canadian economy as real GDP expanded 0.7 per cent on a monthly basis in January. The increase in January marks the ninth consecutive month of positive economic growth, however, total economic activity is still about 3 per cent below its pre-COVID-19 level. With the strong start to 2021, first quarter real GDP growth is tracking at 5.5 per cent on an annualized basis.
An acceleration of vaccinations appears to be on the immediate horizon. As that roll-out progresses, we expect pent-up spending throughout the economy to be unleashed, driving a strong economic recovery. Following an unprecedented contraction in 2020, we expect the Canadian