Tuesday, July 13, 2010

Gentle Caution on new Business

I always keep an eye on the Bank of Canada and business leaders in the major centres of Canada. They to me are the barometer or pulse that we need to watch daily in our own little world.

Today seems still positive but cautious says the business world as reported by the CBC>

" Top bank finds businesses optimistic


Last Updated: Monday, July 12, 2010
12:16 PM ET Comments67Recommend14CBC News

Optimism about the economic recovery is increasing among Canadian businesses, the Bank of Canada says.



In its annual survey of business conditions released Monday, the bank said firms are reporting improved sales activity over the past year.



The Bank of Canada's annual summer survey of business conditions suggests employers intend to increase hiring. (Philip Scott Andrews/Canadian Press)

That's the first time that's happened in two years.



The results of the survey also suggest executives are planning to take on new workers during the next 12 months.



In a separate survey, loan officers told the central bank they are extending credit to firms on better conditions, particularly big firms.



But not all signs are positive. Business executives say they are increasingly concerned over the prospect of global recovery.



Michael Gregory, senior economist with BMO Capital Markets, said that the results show "that firms continue to expect expanding activity, albeit not as broadly as before [in the April Survey]."



"Given the growing concern over the U.S. and global economic outlook, dimmer sales and investment expectations are not surprising," he said.



Bank staff interviewed senior managers at 100 firms selected as a cross-section of the Canadian economy, between May 19 and June 15.



The data collected on the perspectives of these businesses will be part of many factors the bank considers when making decisions about interest rates. The bank warned statistical reliability of the survey is limited, given the small sample size. "





Read more: http://www.cbc.ca/money/story/2010/07/12/boc-survey-business-optimism.html#ixzz0tZ9POZDQ


Remember in my experience banks tend to be conservative so I see the above news alert as more positive than most of my friends in the business world.

Friday, July 9, 2010

News Update on Real Estate Market

Housing market begins to cool
After a strong bounce-back, residential real estate is taking a breather. That may not be a bad thing.

Judging from the recently released May housing data, it looks like experts' predictions that the real estate market would slow during the second half of the year may be on target. Existing home sales, new listings and housing starts all slipped during May, and indications are that the trend will continue.

According to the Canadian Real Estate Association, or CREA, 37,576 homes traded hands on a seasonally adjusted basis during May, compared to 38,654 homes during May of last year. The average price of homes sold during the period rose by 8.5 per cent, compared to those sold during the same month last year, to $346,881. However, that percentage increase was significantly smaller than the 13.6 per cent year-to-date average.

Bing!Canada's most affordable cities for real estate
A combination of rising mortgage rates, changes to mortgage regulations and the July 1 implementation of the Harmonized Sales Tax, or HST, in Ontario and British Columbia (which pulled forward some sales into April that normally would have closed in May or later) are being blamed for the sluggishness. According to Adrienne Warren, of the Scotiabank Group, the figures provide further evidence that Canada's housing market has "lost momentum."

Unsurprisingly, the reduced demand also put a damper on homebuilders, as housing starts fell to 189,100 units in May, compared to 201,800 units during April.

Mixed economic factors suggest cooling-off period
While short-term factors are likely responsible for some of the month-to-month variations in housing data, more structural elements are also at play. The Canadian economy, for example, which had been growing steadily for seven straight months, came in flat during April. Retail sales, which had been climbing steadily since the beginning of last year, also tanked during April, falling 1.9 per cent.

The upside for many first time home buyers is home pricing now becomes affordable for many of them. This opens up huge market for realtors searching for new business. Targeting first time home buyers may be the best bang for your buck, increase gross commission returns, and minimize negative growth in the market place.