New Motor Vehicle Sales, June 2010 Release

Date: August 13, 2010

New Motor Vehicle Sales, June 2010 Release

Source: Statistics Canada

Link to Release: http://www.statcan.gc.ca/daily-quotidien/100813/dq100813a-eng.htm

Summary: Canadian new motor vehicle sales increased 2.5 per cent in June, to 130,135units. Truck sales (SUVs included) led the way, rising 3.2 per cent to 72,709 units. Passenger car sales also rose 1.6 per cent to 57,426 units. Sales improved in eight of ten provinces, including Ontario, where sales increased 1.4 per cent to 48,783 units. Statistics Canada also noted that preliminary figures for July suggest another one per cent increase in sales.

Analysis: The trend for new vehicle sales in Canada has generally been pointing upward since the beginning of 2009, albeit with some month-to-month volatility along the way. Motor vehicle sales are often taken as one indicator of consumer sentiment. The argument is that if an individual is confident in their financial situation (including employment prospects) moving forward, they will be confident in their ability either to make a large cash outlay on a vehicle or make regular payments on a vehicle loan over time without default. With this in mind, it seems reasonable to suggest that more Canadian households feel confident in their financial situation today than they did at the beginning of 2009. Added to this is the fact that increased vehicle sales also serve to reinforce the notion that the fortunes of auto makers have improved over the same period. This is especially important to southern Ontario, where many households still rely employment income related to the motor vehicle sector.

Source: Toronto Real Estate Board

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Canadian Housing Starts, July 2010 Results

Date: August 10, 2010

Canadian Housing Starts, July 2010 Results

Source: Canada Mortgage and Housing Corporation (CMHC)

Link to Release: http://www.cmhc-schl.gc.ca/odpub/esub/64695/64695_2010_M08.pdf

Summary: Canadian housing starts fell 1.6 per cent in July to a seasonally adjusted annualized rate of 189,200 units from an upwardly revised June figure of 192,300 units. Single-family urban starts accounted for much of the decrease, down 11.3 per cent to 67,900 units. Rural starts also fell. A 13.4 per cent increase in multiple-family starts was not enough to offset these declines. Starts in the GTA fell by four per cent to an annualized rate of 26,100 units. On a year-overyear basis, however, both the national and local figures for July were above 2009 levels.

Analysis: The July housing starts figures show that new home construction activity remains above 2009 levels, but the annual rate of starts still remains well below the average for the past decade. At the current level of population in the GTA, an annual housing starts total between 35,000 and 40,000 would make sense for 2010. This justified total is higher than the current annual rate. We are likely experiencing a balancing out in the level of residential construction after very high starts in the years leading up to the recession, when the level of starts was above the level of household growth in many years.

Source: Toronto Real Estate Board

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