credit & debt BORROWING IS ONCE AGAIN ON THE RISE IN CANADA, and the increase in credit extended began before the Bank of Canada started to cut its policy rate. Consumer credit has risen faster than mortgage credit. The debt-service ratio remains elevated, but increases in the mortgage DSR have been largely offset by decreases to the non-mortgage DSR. Mortgage arrears have been increasing but remain low relative to history. demographics CANADA’S ROBUST POPULATION GROWTH HAS CONTINUED INTO 2024, as it appears the new policy limiting non-permanent residents has not yet had an impact. British Columbia’s metro areas are projected to achieve robust population growth over the next decade, and the distribution of those additions are changing. housing BRITISH COLUMBIA’S LARGEST HOUSING MARKETS HAVE BEEN ACCUMULATING HOUSING DEFICITS, and those deficits are projected to grow. BC has new short-term rental restrictions, but few of those homes are suitable for long-term rental housing. Vancouver typically sees less market activity on a per-capita basis relative to Kelowna, but not this year. The state of new home development has changed a lot since REDMA was implemented in 2004, and the act needs to change alongside. policy HOUSING POLICY HAS BECOME A FOCUS FEDERALLY AND PROVINCIALLY, as a slew of new policies have been implemented. The capital gains tax inclusion rate is having a negative impact on real estate and housing supply, while the temporary resident policy change will reduce rental demand once it takes effect. In BC, recent residential tenancy act changes were amended, providing added protections for renters but creating challenges for purchasers of tenanted properties.
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