November 2, 2021
Housing market fundamentals improved over the first half of 2021 Economic and demographic indicators continued to show signs of improvement over the first half of this year following last year’s COVID-19-induced recession. The pandemic’s third wave took hold in April 2021 and resulted in the reinstatement of virus containment measures. These measures were as stringent as those implemented at the onset of the pandemic in spring 2020, according to an index by the Bank of Canada . Their impact on economic activity was not as severe this year due to:
Additionally, immigration recovered, and Canada welcomed 41,500 more permanent residents over the first two quarters this year compared to the same period in 2020. Despite a slowdown in April and May, preliminary estimates from Statistics Canada point to growth in economic activity in June and an increase in real GDP of 2.4% (annualized) in the second quarter . This suggests a 4.0% annualized increase to real GDP since the fourth quarter of 2020 (i.e. since our previous assessment).
Labour market conditions have also improved, with broad-based gains in employment across all services producing industries. Those most adversely affected by the pandemic were:
They were the primary benefactors of this employment growth, though the level of employment for both groups in the second quarter of 2021 was still below its pre-pandemic level (fourth quarter of 2019). Historically, these groups have been more active in the rental market.
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