measuring the effects of a global shutdown
as the official tally of unemployment rose by 117,300. Numbers aside, we know that virtually every business in Canada has been affected one way or another by our response to COVID-19, and mostly in a negative way. So the situation is, for now, challenging. Unlike at the outset of past severe downturns like the Great Depression of the early-1930s and the Great Recession of 2008/9, however, we know that this mandated economic shutdown has an end to it. Canada’s unprecedented federal economic stabilization package, the myriad provincial stimulus plans, and the Bank of Canada’s aggressive monetary policy-- including the heretofore unicorn of the Bank’s arsenal, Quantitative Easing--are all aimed at bridging us fromwhere we are to where we need to be. We are in the midst of a 12-round, heavyweight boxing match that we are going to win, but that will leave us groggy and needing time to recover. What will that recovery look like?Will it be v-shaped? U-shaped? Arabic Baa-shaped? A square root sign?We don’t know. But at rennie, and in each month’s rennie review just as we’ve always done, we will continue to collect and analyze the latest data that will help us navigate the path that lies ahead. That much, you can expect.
expected, but we expect April’s resales to be far below those of March. More reflective of our current predicament than sales counts, perhaps, is that the number of withdrawn listings rose by 29% between the first and second halves of March (compared to virtually no change inMarch 2019)--a harbinger of things to come. Moving on to the latest jobs data, which were released just last week, we see a Canadian unemployment rate that has jumped from 5.6% in February to 7.8% inMarch. This is a sizeable expansion to be sure, but it is based on the number of unemployed people across the country growing by 1.01 million--far less than the estimated 4 million people who applied for EI benefits in the past fewweeks. (Why the discrepancy? Because the latest jobs data, from Statistics Canada’s Labour Force Survey, were collected betweenMarch 15-21 and therefore only captured the initial impacts of the Suppression.) Here inMetro Vancouver, the region’s unemployment rate rose from 4.4% to 7.5% between February andMarch
There is a well-known saying that the best laid plans often go awry; that, of course, we never really do expect the unexpected. Indeed, here we are in April 2020 in the midst of a self-imposed economic lockdown, one month after a global pandemic was declared. Few people (if any) predicted the scale and scope of what we are now experiencing. And as we settle into new routines and realities (temporarily, at least), it is instructive to consider what the data are telling us about the state of our economy and our resale market. Interestingly (and somewhat frustratingly to market analysts), the latest data on our local resale market and on our economy have not fully captured the effects of our coordinated economic shutdown. In looking at resale trends inMetro Vancouver, sales processed in the second half of March 2020 were only down 8% versus the first half of the month (in 2019 they increased by 3% between the first and second halves of March). Not as bad as one might have
Copyright © 2020 rennie group of companies. All rights reserved. This material may not be reproduced or distributed, in whole or in part, without the prior written permission of the rennie group of companies. Current as of January 6, 2020. All data from Real Estate Board of Greater Vancouver and Fraser Valley & Rennie. While the information and data contained herein has been obtained from sources deemed reliable, accuracy cannot be guaranteed. rennie group of companies does not assume responsibility or liability for any inaccuracies. The recipient of the information should take steps as the recipient may deem necessary to verify the information prior to placing any reliance upon the information. The information contained within this report should not be used as an opinion of value, such opinions should and can be obtained from a rennie and associates advisor. All information is subject to change and any property may be withdrawn from the market at any time without notice or obligation to the recipient from rennie group of companies. E.&O.E. 3
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