August Sylvan Lake sales were up slightly over July and almost double sales in August 2011. The beautiful weather in July and August may have had an impact, although the cottage market is still struggling.
Sales activity in August was spread across the lower end of the price spectrum (under $400,000) which is contrary to what happened in Red Deer where the starter market is slower. High end activity in Sylvan is still slow although much better than last year.
The listing inventory in Sylvan continues to shrink. Lower inventory levels combined with stronger sales are helping to bring the market closer to balance, although buyers continue to have the advantage with only 1.5 buyers for every 10 homes on the market in August.
Excerpts from Aug. 31/12 ATB Financial Weekly Economic Bulletin by Todd Hirsch & Will Van’t Veld
Canadian GDP chugs higher – One of the most reliable and closely watched indicators of economic activity is the quarterly national accounts, which measures the gross domestic product. On this final day of August, we learn that the Canadian economy keeps chugging along—slowly but surely.
The total value of all goods and services produced in the Canadian economy grew by 1.8 per cent in the second quarter of 2012 (adjusted for inflation), according to the latest release from Statistics Canada. That slightly exceeded the 1.6 per cent expansion predicted by a consensus of economists. Speaking to the media this morning, Canada’s Finance Minister Jim Flaherty said: “We
have now witnessed four straight quarters of economic growth. While the grow this modest, it reinforces Canada’s positive economic track relative to other countries. Indeed, Canada continues to have the strongest economic growth of all of the G7 industrialized countries.”
There s no quarterly breakdown available for the provinces, but Alberta’s energy sector may have been one of the contributors to the country’s overall growth. Statistics Canada reports that “oil and gas extraction increased 1.0% in the econd quarter, as an increase in crude petroleum production was partly offset by a decrease in natural gas extraction.” The relatively good news for the economy lifted the Canadian dollar this morning, which was up almost half a cent against the U.S. dollar.
However, the growth will not be strong enough to convince the Bank of Canada to raise interest rates. With very little inflation pressure building, and only modest growth, there will be no appetite building at the Bank to hit the button on rate increases until well into 2013.
U.S. economic update – Economic growth in the United States came in slightly better than expected in the second quarter, at 1.7 per cent. This was down from 2 per cent in the first quarter. Most GDP components were slightly slower in the second quarter, which was expected, but net exports came in more positive and government spending decelerated less than it did in the first quarter.
U.S. housing continues to be a good news story, with the influential Case-Shiller Home Price Index increasing 1.2 per cent on a year-over-year basis in June, the first time the indicator has turned positive since the 2010 home-tax buyer credit. The Case-Shiller index measures the change in home prices that have been sold at least twice. In other news economic news, U.S. personal consumption expenditures and disposable income for July came in fairly strong, increasing 0.4 and 0.3 per cent, respectively. This was the fastest consumption
expenditures increased in five months. On a less optimistic note, new jobless claims benefits have remained relatively flat, indicating that employment has yet to pick up significantly enough to reduce the unemployment rate.