Loans Gone Wild

🤷‍♂️ BoC Rate Cut? Doesn’t Matter If No One’s Buying

• Even with expected rate cuts, buyer activity is stalled. Fear of falling prices, inflation, and job losses are keeping people out of the market.

• First-time buyers are cautious. Many expect home values to drop after purchase, especially in Toronto’s condo market.

• Sellers refuse to drop prices, while buyers expect deals. This disconnect has pushed transaction volumes to 25–30-year lows.

• Most current mortgage activity involves owners renewing ultra-low pandemic loans at significantly higher rates. Banks are competitive only if customers push back with better offers.

Why This Matters: The market isn’t waiting for a rate cut — it’s waiting for stability. Until economic uncertainty fades and prices correct further, buyers will remain hesitant, sellers will hold out, and the housing market will stay locked. _(source)

📈 Renewals Trigger Spike in Delinquencies

• Household debt in Canada hit $2.55 trillion, with non-mortgage debt averaging $21,859 per consumer.

• Toronto and Ontario are now the epicentre of financial stress, with 90+ day mortgage delinquencies up 71.5% and non-mortgage delinquencies up 24% year-over-year.

• Younger Canadians are being hit the hardest: credit card delinquencies for those under 35 jumped 21.7%, and auto loan delinquencies rose 30%.

• Many homeowners are refinancing their pandemic-era mortgages in today’s higher-rate market. 29% are using credit to pay off other credit

Why This Matters: Canada’s economy is no longer being cushioned by its housing sector or consumer demand. The usual policy tools aren’t working, and sentiment is declining fast. With job losses already stacking up and immigration-driven demand slowing, real estate, employment, and investment are all under pressure.

🤑 Billionaire Buys 28 Hudson’s Bay Leases

• B.C. billionaire Ruby Liu (Central Walk Canada) has agreed to acquire the leases for up to 28 Hudson’s Bay stores across B.C., Alberta, and Ontario.

• The new retail chain will not use the Hudson’s Bay brand, which Canadian Tire recently acquired for $30 million.

• The goal is to reimagine the department store format into modern, family-focused spaces with intergenerational appeal and immersive retail experiences.

• This transition occurs as Hudson’s Bay winds down operations across Canada. All remaining stores are expected to close by early June 2025.

Why This Matters: This marks the end of an era for Hudson’s Bay’s physical presence in Canada and opens the door to a new national retail chain. Reusing legacy department store spaces is part of a broader trend across North America as anchor tenants decline and malls adapt.

🥳 Condo Glut Means Freebies for Tenants