Huricane Juan
Toronto Star
  • Canadian real estate and housing boom may be ending, Scotiabank warns

    Boom times are over for Canada’s housing sector and the impact of “a more subdued trajectory” will be felt everywhere from construction and home renovation sites to retail stores, a Scotiabank Economics report predicts.

    · Condo sales, prices up but rents starting to ease

    Housing has generated a staggering $1.7 trillion in net new wealth for Canadians since 2000. A slowdown in house price gains — or even a possible slump in prices — “will reinforce a more cautious trend in consumer spending,” warns the Industry Trends report released Wednesday.

    · Toronto home sales expected to be ‘brisk’ this summer

    “Canada’s long housing cycle is turning. Residential investment stalled last year as affordability constraints tempered home sales, and builders scaled back the number of new developments,” notes the report by Scotiabank economist Adrienne Warren.

    “We expect the sector will remain on a more subdued trajectory over the next several years, imposing a modest drag on output growth.”

    · First-time home buyers feeling more confident: poll

    Calling housing “a large and integral part of the Canadian economy,” Warren points to the following factors that emphasize how broad the impact could be.

    · Residential investment, which includes new construction, renovations and the costs (from commissions to appraisals) of buying and selling real estate, added up to $128 billion in 2013 alone.

    · That investment increased, on average, by 4.2 per cent between 2000 and 2012, almost double the GDP growth rate of 2.2 per cent, and accounts for almost 7 per cent of overall economic output, the highest among the G7 countries and double the rate of the U.S.

    · Forty-five per cent of that boost to the economy comes from new construction, 37 per cent from renovation and 18 per cent from real estate transaction and transfer costs.

    · Renovation spending, which totalled more than $47 billion in 2013, has reached record levels and become the fastest growing segment of real estate investment as more homeowners took advantage of their rising home values, low interest rates and government tax credits, to spruce up their nest rather than move to a new one.

    · The total spent to create all those granite-clad kitchens and Euro-style bathrooms, and boost the value of Canada’s housing stock, grew by an average of 6 per cent between 2000 and 2012, notes Warren. That’s double the 3 per cent annual growth rate of new housing construction during the same period.

    · There are many spillover benefits for secondary industries such as appliance manufacturers, suppliers of building materials, engineering services etc.

    Housing remains a labour force giant, with 235,000 Canadians employed in residential construction in 2011 and another 245,000 in the real estate services sector alone.

    But anyone doubting the impact of Canada’s decade-long housing boom just needs to consider one other number: Where Canadians are now worth $1.7 trillion more than they were back in 2000, the depressed housing market of the 1990s generated a relatively paltry $324 billion in new household wealth.

    Warren likens the coming years for the housing market as ones of “less tailwind to more headwind” and expects to see resale activity edge lower in 2014/2015.

    “Rising mortgage rates, combined with high home prices and stricter mortgage regulations, will strain affordability, especially for first-time buyers in major urban centres.”

    But population growth and a healthy labour market should keep sales levels close to 10-year norms. A softening of sales should slow price growth, with the greatest risk of an actual downturn in prices likely in the “more amply supplied high-rise segment than for single-family homes,” she notes.

  • Accused killer in Calgary stabbing deaths getting psychiatric assessment

    CALGARY—The accused killer in the stabbing deaths of five young people early Tuesday morning in Calgary is being held in hospital undergoing a court-ordered psychiatric assessment, his lawyer told the Star.

    Matthew de Grood, 22, is currently at Calgary’s Southern Alberta Forensic Psychiatry Centre, said Allan Fay.

    “He’s holding up as well as anyone would under the circumstances,” he said. “Obviously his family is devastated.”

    De Grood spent Tuesday in another Calgary hospital undergoing treatment for dog bites, which he sustained before being apprehended by police.

    From his hospital room, de Grood appeared briefly via telephone before a justice of the peace on Tuesday, but said little when the charges were read to him. His next appearance is April 22.

    Fay said his conversations with his client have been brief, and he is still not sure if he will apply for de Grood’s release on bail ahead of his trial.

    He said he “believes” de Grood, a graduate of the University of Calgary and son of a 33-year veteran of the police force, does understand the charges.

    “Obviously, facing five counts of first-degree murder would be overwhelming for anyone,” he said.


    More National news stories on

    About 20 people were at a party at a house on Butler Cres. Monday night in honour of Bermuda Shorts Day — a 53-year-old tradition at the University of Calgary that commemorates the end of the term — when the sudden knife attack occurred.

    Among them were Zackariah Rathwell and Josh Hunter, two members of a local band called Zackariah and the Prophets. Rathwell and Hunter both died in the attack. They were 23 and 22 respectively.

    Three more people — whom media reports have identified as Jordan Segura, Lawrence Hong and Kaiti Perras — were also killed at the party.

    Condolences for the five young people have been pouring out from people and politicians across the country and the university has been offering counselling services to students who want it.

    Calgary police chief Rick Hanson called the incident “the worst mass murder in Calgary’s history.”

    “We’ve never seen five people killed by an individual at one scene. The scene was horrific,” Hanson said.

    With files from Jane Gerster and Tim Alamenciak

  • NATO increases military moves to counter Russia

    BRUSSELS—NATO is strengthening its military footprint along its eastern border immediately in response to Russia's aggression in Ukraine, the alliance's chief said Wednesday.

    Secretary General Anders Fogh Rasmussen said NATO's air policing aircraft will fly more sorties over the Baltic region and allied warships will deploy to the Baltic Sea, the eastern Mediterranean and elsewhere if needed.

    More on

    Ukraine on brink of civil war says Moscow

    Harper attacks Putin to burnish legacy

    “We will have more planes in the air, more ships on the water and more readiness on the land,” Fogh Rasmussen told reporters in Brussels, declining to give exact troop figures.

    Moscow must make clear “it doesn't support the violent actions of well-armed militias or pro-Russian separatists” in eastern Ukraine, he added.

    NATO's eastern members — including Lithuania, Estonia, Latvia and Poland — have been wary following Russia's annexation of Ukraine's Crimean Peninsula, demanding a more robust military deterrence to counter neighbouring Russia.

    Rasmussen said the new NATO deployments are about “deterrence and de-escalation” in the face of Russia's aggressive behaviour.

    NATO estimates Russia has amassed some 40,000 troops on Ukraine's eastern border and could invade if it wished. Fogh Rasmussen again urged Russia to pull those troops back.

    The NATO chief did not mention naval deployments to the Black Sea — which Russia would likely see as a direct aggression even though NATO members Bulgaria, Romania and Turkey also border the sea.

    He insisted, however, that “more will follow if needed.”

    There are also no apparent plans to deploy ground troops to reinforce alliance members closest to Russia.

    Rasmussen spoke after NATO's decision-making body, the North Atlantic Council, approved recommendations from U.S. Air Force Gen. Philip Breedlove, the alliance's supreme commander in Europe, on how to beef up defences of member states closest to Russia.

    The 28-nation alliance has already suspended most co-operation and talks with Russia. The United States has dispatched fighter planes to Poland and the Baltics, enabling NATO to reinforce air patrols on its eastern border. NATO also performs daily AWACs surveillance flights over Poland and Romania.

Arts & Letters
Sunday, 12 August 2007