Output in the the Canadian economy declined in November with real GDP falling 0.1 per cent on a monthly basis. That decline partially offset robust 0.3 per cent growth in the month of October. A decline in the wholesale trade, finance and insurance, manufacturing and construction industries dragged overall GDP lower despite 13 of 20 industrial sectors posting gains. The GDP of offices of real estate agents and brokers declined for a third consecutive month as the volume of home sales weakened to end 2018. Overall, we are tracking fourth quarter Canadian economic growth at between 1 and 1.5 per cent.
While there are not many positives from November's GDP report, softening economic growth will keep the Bank of Canada sidelined which should translate to lower mortgage rates this year. That could provide much needed relief for prospective home-buyers currently shut out of markets due to the mortgage stress test.
Copyright British Columbia Real Estate Association. Reprinted with permission.