The following is an update from Glynis MacLeod PREC* of the MacLeod Group.
Yesterday, the Bank of Canada held the overnight rate at 5% and there is now a widely held belief in financial markets that it is the last hold before embarking on a series of rate cuts starting in June.
According to the BCREA Chief economist, Brendon Ogmundson, there is also mounting evidence that this is the correct course of action. Jobs data from March showed that the Canadian unemployment rate reached its highest level in three years and inflation is well below target once housing costs are removed. Given that housing costs are rising as a function of the Bank's tight monetary policy and its effects on mortgage rates and new home supply, it would be wise for the Bank to look past rising shelter inflation when setting the future course of monetary policy.
“We expect that the Bank will lower rates 3 to 4 times this year in 25 bps increments with 2.5% as the ultimate destination for the overnight rate by the end of 2025,” said Ogmundson.
In Greater Victoria, as of the end of March, there were 2,647 active listings for sale. This was an increase of 34.4% from March 2023 however many of these are relists from last year when the market slowed considerably. Reported sales matched those compared to a year ago but activity on listings has increased dramatically and buyers are definitely out shopping.
Statistics Canada reported that British Columbia had more people moving out to other provinces in 2023 than those coming in the opposite direction for the first time in more than a decade. The agency said B.C. recorded a net loss of 8,624 people in interprovincial migration last year, something that hasn't happened since 2012. This supports what we have seen with Alberta, especially Calgary, attracting young people due to quality jobs and housing affordability.
Last week saw the first cruise ship of the season arrive in Victoria. This year, 315 ships will visit bringing about 910,000 passengers to the city. This contributes about $143 million per season to the capital region, said Robert Lewis-Manning, chief executive of the Greater Victoria Harbour Authority. The sector generates about 800 direct jobs.
We look forward to the incredible summer that Victoria offers and hope to hear from you.