Canadian Home Sales Fall To Lowest Level In 3 Years: CREA

January activity was down in three-quarters of all local markets and virtually all major urban areas.

Canadian home sales fell 14.5 per cent between December and January, marking the lowest sales level in three years as the housing market was hit last month by a double whammy of tighter mortgage rules and lending rate hikes.

Data released by the Canadian Real Estate Association Thursday suggested that January activity was down in three-quarters of all local markets and virtually all major urban areas, especially in Ontario’s hot spot in the Greater Golden Horseshoe. The decline was less significant on an annual basis, with sales falling 2.4 per cent.

Sales climbed to a record monthly high in December, according to CREA’s figures, ahead of the stress test that requires all potential buyers qualifying for a mortgage to show that they can manage interest rate increases.

“The decline in January sales provides clear evidence that the strength in activity late last year reflected a pull-forward of transactions, as rational homebuyers hurried to purchase before mortgage rules changed in 2018,” said Gregory Klump, the association’s chief economist.

The federal banking regulator introduced tougher rules for uninsured mortgages beginning Jan. 1 that require a stress test for borrowers with a more than 20 per cent down payment. They now have to prove that they can service mortgage at a qualifying rate of the greater of the contractual mortgage rate plus two percentage point or the five-year benchmark rate published by the Bank of Canada.

The monthly decline “is largely payback” for buyers rushing to sign deals in the last three months of the year, ahead of the new rules, said Robert Kavcic, senior economist at BMO Capital Markets, in a note.

January sales on par with 10-year monthly average

The January market also dampened due to the Bank of Canada’s decision to raise interest rates to 1.25 per cent, up from one per cent. It was the bank’s third increase since last summer, following hikes in July and September.

The central bank’s interest rate increase impacts variable rate mortgage holders, but those who opt for fixed mortgages also saw a rise in the five-year fixed rate amid rising bond yields and a stronger economy.

CREA noted that January home sales are on par with the 10-year monthly average and that a large decline in new listings prevented the market balance from shifting in favour of homebuyers. The average price of a home rose by 2.3 per cent when compared with last year at just over $481,500.

Interestingly, new listings plunged.

The national sales-to-new listings ratio was 63.6 per cent in January. A ratio reading above 60 per cent generally indicates a sellers’ market.

The number of newly-listed homes was at the lowest level since spring 2009. About 85 per cent of all markets had fewer listings. The Greater Toronto Area led the decline, with large percentage drops also in British Columbia’s Lower Mainland, Vancouver Island and the Okanagan region, as well as parts of Ontario.

“Interestingly, new listings plunged,” Kavcic said, highlighting a 21.6 per cent drop in listings from December 2017 to January 2018 that he said allowed the market balance to tighten up at the national level.

The highly anticipated report confirmed expectations for how the market would react to the new mortgage rules, Michael Dolega, a senior economist with TD Economics, wrote in a note.

He expects some near-term volatility to continue as buyers and sellers absorb the fall out from the new rules and rising rates. But, Dolega said “some stabilization” should occur by the middle of the year.

“Thereafter we expect activity to remain weighed down by rising interest rates, but with markets largely in balanced territory prices should remain well supported,” he said.

The new mortgage rules created uncertainty and confusion for homebuyers, said CREA President Andrew Peck in a statement.

“At the same time, the changes do nothing to address government concerns about home prices that stem from an ongoing supply shortage in major markets like Vancouver and Toronto. Unless these supply shortages are addressed, concerns will persist.”

-Huffington Post

How to choose the right Agent Part 1 – What is in a Network

I have always received these questions, periodically, but lately it seems like almost daily I am asked “how do I choose the right realtor to sell my home”. I have always been an advocate of interviewing agents and ensuring that you have the right fit for you. You should never choose a Realtor without knowing and understanding how they are going to work for you! I am writing a part mini series that will include some insider tips on what to look for in a Realtor and very specific things to ask while you’re interviewing. Choosing someone to sell your home is a very important choice, I want to make sure you know what to look for!

A Realtors network is like a golden ticket. Most might think “The bigger the team and the fancier the website the quicker the sale” This isn’t necessarily true. Your realtor should have a network of potential buyers, sellers, Realtors, Mortgage professionals, lenders and brokers that work as a team to get the job done. Ask your Realtor about his or her professional network, you very well could be interviewing a Realtor that has a client just waiting to put an offer in on your home, they were simply waiting for that special something to come along. Real Estate professionals can’t work in silos, the biggest key to success in Real Estate is to have a respected group of people who you connect with regularly.

I recently did a study on first time home buyers in Alberta. 23% of those who responded said that they were not in the market to buy a home. The top reasons being 1. down payment and 2. Mortgage approval. As the study continued it became glaringly obvious that for MOST of this 23% home ownership was actually attainable, they simply were not educated or up to date on what options are available to them. My point here is this; Take **John and Susie for example. Looking for their dream home which is a 1200sq ft. front attached garage home in Windsong. They believed they would never qualify so they were waiting and saving… waiting… and saving. I had the opportunity to list a 1300sqft home in Windsong that would be PERFECT for this growing family. You guessed right… Because I have a trusted network of professionals we had their down payment sorted out, had them Mortgaged (with a pretty great rate to boot) and into this home. Their Mortgage payment is less than they were paying in rent and they OWN it! All of this they originally thought was unattainable. Now, This is a stellar example because Bob and Betty were able to sell their home before it even hit MLS for 24 hours and John and Susie were home owners, but not unrealistic with the right opportunity and the right network of Real Estate wizards working together! Every thing is impossible if you don’t try! Your Realtor should always try! with everything they have got! So when you’re interviewing, ask them this; “What does your professional network look like, and how are you going to step up to the plate for me?”

** Names and communities changed for privacy

Home prices rise on gains in Vancouver, Victoria

Canada’s housing market saw prices rise on a national basis in January, but the growth was almost entirely due to strength in Vancouver and Victoria.

The Teranet-National Bank National Composite House Price Index, which measures sale prices in 11 major markets, rose 0.3 per cent in January over December.

Teranet said the price bounce was not widespread, however, with only four markets climbing in January. Prices were buoyed largely by a 1.2-per-cent increase in the Vancouver region — which came on the heels of a 1.3-per-cent increase in December – and a 1-per-cent price increase in Victoria.

 National Bank economist Marc Pinsonneault said Vancouver drove the national index increase in January, with the region’s condo market up 23 per cent compared to January last year, while the index for all other types of homes rose 13.5 per cent over the past year.

“Without Vancouver, the composite index would have retreated for a fifth month in a row,” Mr. Pinsonneault said in a research note.

Prices rose a marginal 0.2 per cent in the Toronto region in January over December, which was the first increase in the index in six months.

The index is a rolling three-month average to smooth out monthly fluctuations. On an unsmoothed basis, the Toronto region has now seen three months of price increases, Teranet said.

Mr. Pinsonneault said some of the recent growth in Toronto may have come from a rush to purchase before tough new mortgage qualification stress test rules took effect Jan. 1.

He said there are also still mortgage rate increases to come this year, so “it is premature to conclude that home prices have definitely turned the corner in Toronto.”

The Teranet index edged up 0.1 per cent in Montreal in January, while all other cities saw prices decline on a month-over-month basis. The biggest declines were see in Quebec City, which was down 2 per cent over December, and in Winnipeg, where the index fell 1.1 per cent over December.

-Globe & Mail


Change is good

Loyal followers, clients and friends. As some of you may have noticed, change is in the air! With a new year, brings new challenges and opportunities. Being a successful Realtor is one of my life’s greatest accomplishments, mostly because of the connections I make, relationships I foster and dreams I help make a reality the moment I hand over the keys to what is likely your greatest investment. your home. I have worked at CIR as a realtor for nearly a decade, growing my business and taking full advantage of the opportunities that were presented to me. I have nothing but respect, and admiration for the brokerage that helped to build my career. Those who know me best know that my ambitions are great, and I have to consistently set new goals. Professionally I have decided to move my business under a new roof with Re/max First. A reputable and respected brokerage that can offer me international exposure under the Re/max brand. My excitement is palpable, and I am thrilled to get my new signs up on some lawns in the coming weeks.

I have taken January to rebuild my brand, be mindful of my decision, and ignite the fire inside me that is going to kill it in this Calgary Real Estate Market for 2018. You will see me donning the Blue and Red. Nothing more has changed but that. My clients can rely on the same honest, patient and loyal service you have all grown to refer and respect!

Onward and Upward!

  • Special thanks to Dave Anderson and the team at CIR, you have been a great leader and a tremendous support throughout my transition
  • Special Thanks to Rick Campos, Cliff Stevenson the team at Re/max First who have welcomed me, and supported my business.


Kevin D’Costa 

20% more mortgages are being denied by big banks, sending borrowers down the credit ladder

Mortgage brokers say the borrower rejection rate from large banks and traditional monoline mortgage lenders has gone up as much as 20 per cent after Canada’s banking regulator imposed a new stress test for home buyers who don’t need mortgage insurance.

As a result, alternative lenders are seeing an uptick in business as brokers increasingly direct home buyers toward borrowing options that are beyond the reach of the Office of the Superintendent of Financial Institutions’ newly enacted tighter lending requirements.

Clients who don’t meet the bar are turning to private lenders, mortgage investment corporations (MICs) and credit unions, which are provincially regulated and not required to implement the stress test, said Carmen Campagnaro, president of Pro Funds Mortgages in Burlington, Ont.

Campagnaro is one of the brokers who said rejected loan applications to traditional lenders have risen by 20 per cent since Jan.1, when OSFI mandated a new stress test for uninsured borrowers, or those who have more than a 20 per cent down payment.

Private lender Fisgard Asset Management Corporation in Victoria is seeing an influx of borrowers and “better quality business” said Hali Noble, its senior vice president of residential mortgage investments and broker relations.

“A lot of these people should be bankable,” said Noble. “But they’re not.”

The guidelines, known as B20, are aimed at curbing risky lending amid rising household indebtedness and high home prices in some markets.

In order to get a loan from a federally regulated lender, home buyers have to prove that they can service their uninsured mortgage at a qualifying rate of the greater of the contractual mortgage rate plus two percentage point or the five-year benchmark rate published by the Bank of Canada. An existing stress test already requires those with insured mortgages to qualify at the Bank of Canada benchmark five-year mortgage rule.

Superintendent Jeremy Rudin has said OSFI is aware the stricter rules could have unintended consequences, such as sending borrowers towards more risky lenders that are out of the regulator’s purview.

“We can’t control what we can’t control,” he said in October.

“Our mandate is focused on the safety and soundness of the federally regulated institutions… It isn’t something that we favour but it isn’t something that we have an authority to prevent.”

Since the revised mortgage guidelines came into force, both the Bank of Canada of rate and benchmark rate has risen, dealing a “double extra whammy” to borrowers, said Dave Teixeira, vice president of operations, public relations and communications for Dominion Lending Centres.

Dominion mortgage brokers are seeing a higher rate of rejection and clients have to submit multiple applications to various institutions before finding a lender that works, he added.

In turn, their brokers are submitting 80 per cent more applications than last year, Teixeira said.

“Normally, we would see our volume going to the big banks and monolines, and now we’re seeing a little bit more of that, roughly up to 20 per cent… moving over to credit unions.”

However, some credit unions have voluntarily implemented the new stress test or tightened their own requirements.

Quebec credit union Desjardins Group has been applying OSFI’s new mortgage rules in full since Jan. 1.

“We believe it represents an effective way to protect consumers against interest rates variations,” said Desjardins spokeswoman Valerie Lamarre.

Vancouver-based Vancity Credit Union has voluntarily increased the stress test its members must meet to qualify for a mortgage.

Rick Sielski, Vancity’s senior vice president of risk, would not disclose the mechanics of the stress test and said it was too early to gauge the impact of the new guidelines.

“What we’re really trying to do is make sure we’re serving our market, serving our members in a responsible way,” he said.

The higher bar for borrowers is also shifting business to riskier lenders.

Harold Gerstel, better known as Harold the Mortgage Closer from his television ads, said his Toronto-based mortgage arm is seeing an influx as well.

“We’re definitely getting more business. Whether it’s a substantial change, it’s too early to tell,” he said.

The new rules are sending better quality demand down the credit line, said Robert McLister, a mortgage planner at IntelliMortgage and the founder of

“The demand is shifting down the ladder, so you have these less regulated lenders with higher risk tolerance now seeing materially more business. And they can charge more, and they can be pickier with the types of borrowers that they lend to.”

-Calgary Herald

CREB Housing Market

Housing Market Déjà Vu in January

As expected, Calgary sales activity similar to last year

Calgary, Feb. 1, 2018 – The new year opened predictably, with monthly figures close to the Januarys of the past three years.

With new mortgage rules and rates officially in effect, sales activity in January remained comparable to last year, as rising sales for attached properties were not enough to offset declines in both the apartment and detached sector.

Overall January sales totaled 958 units, nearly two per cent above last year and 11 per cent below long-term averages.

“2018 was kicked off with higher rates and the official implementation of the new mortgage requirements. While it is too early to see the impact of these changes, so far, January levels are consistent with what we saw last year,” said CREB® chief economist Ann-Marie Lurie.

“The recovery will be bumpy, and we will continue to monitor the impact of the lending changes relative to the overall economic climate.”

Stable sales were met with rising new listings, causing further gains in inventory levels and impacting prices. Citywide, unadjusted prices totaled $432,300, 0.21 per cent below last month and 0.25 per cent below last year’s figures. Prices eased across all product types compared to last month, but price declines were more pronounced in the apartment and attached sectors.

In the detached sector, new listings rose with declining sales activity for product priced over $500,000. However, product priced between $300,000 and $399,999 saw an increase in activity. This will be an adjustment to the new reality buyers and sellers face, as pockets of the market will experience a mismatch between supply and demand.

“Sellers needs to be aware of the competing supply in the market. This can influence the timing of their decision, along with setting realistic expectations regarding time on the market and selling price,” said 2018 CREB® president Tom Westcott. “For buyers, getting pre-approved for a mortgage is essential, along with getting advice from a REALTOR® to get into a home they will be happy with.


Housing market may hit slow patch on back of interest rate hike, new mortgage rules

TORONTO — Canada’s real estate market will hit a slow patch in 2018 as tighter mortgage stress tests apply pressure and the impact could be exacerbated if an expected interest rate hike drives buyers to put off their home purchases, economists said Monday.

The Bank of Canada will make its first interest rate announcement of the year on Wednesday. Many observers predict will boost the country’s benchmark rate by 25 points to 1.25 per cent after the economy’s strong performance last year and a particularly strong jobs report from November. If the economy keeps pace, they believe that rate may be bumped up a few more times over 2018.

The suspected hikes could heap stress onto buyers already combating stricter regulations that were introduced by the Office of the Superintendent of Financial Institutions on Jan. 1 for uninsured mortgages, and elevated five-year, fixed mortgage rates that were pushed up by the CIBC, RBC and TD banks last week.

“This is the most significant test the market has seen in recent years,” said Benjamin Tal, CIBC’s chief deputy chief economist.

He expects a market slowdown to be seen as early as the first quarter as people who were hoping to scoop up homes weigh whether renting or living with family for a bit longer will pay off later in the year, when the country has grown accustomed to the new conditions.

“The big question though is to what extent investors will stop buying,” says Tal. “That will carry a big effect, but it’s still the biggest unknown.”

The Canadian Real Estate Association slashed its sales forecast for 2018 to predict a 5.3 per cent drop in national sales to 486,600 units this year, shaving about 8,500 units from its previous estimate due to the impact of the stricter mortgage stress tests.

On Monday, the association released a report revealing that national home sales rose 4.5 per cent in December from the month before and that the average national home price reached just over $496,500, up 5.7 per cent from one year earlier.

It said the bounce likely stemmed from buyers scrambling to nab homes before being forced to submit to the uninsured mortgage regulations, which requires would-be homebuyers with a more than 20 per cent down payment to prove they can still service their uninsured mortgage at a qualifying rate of the greater of the contractual mortgage rate plus two percentage points or the five-year benchmark rate published by the Bank of Canada.

“It will be interesting to see if the monthly sales activity continues to rise despite tighter mortgage regulations,” Gregory Klump, CREA’s chief economist, said in the report.

It also shared that the number of homes on the market increased by 3.3 per cent in December from the month before and December home sales were up 4.1 per cent on a year-over-year basis.

The improvements signal that the country is “fully recovering from the slump last summer” when there was a drop in sales before a set of policies introduced by the Ontario government in April produced the desired market slowdown in Toronto during the second and third quarters following a hot first quarter.

“The new OFSI measures and a shift to a rising-state environment should prevent speculative froth from building again, and contain price growth to a reasonable pace for the remainder of the cycle,” BMO Capital Markets senior economist Robert Kavcic predicted in a note Monday.

Looking across the country, he said Toronto home sales were in “a strong spot,” Calgary’s “remained steady” and Ottawa and Montreal were “continually showing better momentum.”

CREA said in December it had seen 60 per cent of all local markets surge in activity.

That spike came as no surprise to Toronto-based realtor David Fleming.

While agents typically avoid keeping listings up over the holidays, he saw many bucking their usual habit this year by leaving homes on the market because sales were so strong.

Of the three listings he let sit, one sold on Dec. 31 and another on Jan. 2.

“There are definitely people who thought they had to close a deal before Jan. 1. and the numbers are really showing that,” Fleming said.

“I think it will take a couple months for buyers to wrap their heads around the new rules and for the country to see the affect.”

-Calgary Herald


City census shows Calgary’s housing glut highest in decades, but it may not last

Despite a steady wave of indicators that suggest Calgary’s economy is on the mend after a bruising recession, data released Thursday show the city is dealing with a glut of housing that hasn’t been so big in three decades, perhaps longer.In its latest census, the city reported that more than 23,600 housing units are vacant, up by 2,700 over last year’s levels, pushing the vacancy rate to 4.76 per cent, its highest peak in recent memory.
Census figures dating back to 1989 show the number and rate of vacancies have never been so high in the nearly 30-year period.
Economist Trevor Tombe said the high volumes of empty housing appear to be a lingering effect of the recent recession, but he said the glut will not be permanent.

Tombe said other economic indicators, such as employment, oil production and exports, continue to suggest Alberta’s recession ended last fall. The province has also attracted new residents, especially from other countries.

The latest civic census shows more people moved to Calgary in the last year than left in the past year. While the boost of 1,000 people was relatively low, it was still a reversal from last year, when the city reported an out-migration of 6,500 people.

“The bottom in the recession is behind us,” Tombe said.
Housing vacancies in Calgary continue to be concentrated in apartments following a surge in boom-time construction that flooded the market with new units when the recession hit.
According to the census, there were 10,600 vacant apartments in April, accounting for 45 per cent of all empty dwellings, followed by 5,000 vacant single-family homes.
Renters have been reaping the rewards of the glut, which has given them much more housing to choose from, while landlords have offered lower rates, rent holidays and other perks to attract tenants.
Bob Dhillon, chief executive of the western Canadian landlord Mainstreet Equities, said high rental vacancies have been driven in part by a drop of in-migration and an increase of tenants leaving their apartments to either live with friends or family, or to move out of the city.

A third factor, he said, was a spike in condo construction with many of the new units being converted to rentals.

Still, Dhillon believes the economy is on the rebound.

Mainstreet reported Thursday that its vacancy rate for properties it has owned for a year or longer was nearly 10 per cent in the last quarter, down from 12 per cent a year ago.

But its rental revenues per each apartment fell by five per cent, to $865, in the three months ending June 30, due to rental incentives, bad debts from tenants and acquisitions of properties with high vacancies.

Dhillon said rents in Alberta appeared to have hit a bottom, though he expects incentives, such as rent holidays, will likely continue for the rest of the year and perhaps into 2018.

The CEO believes an oversupply of rental apartments will eventually be taken off the market as Alberta’s economy adds more jobs and more people move to the city. He said an in-migration of people from other countries is good for his business, given that they typically rent.

“Every indicator is showing that things have bottomed and bounced off the bottom,” Dhillon said. “The challenge is, how long will it take to absorb the vacant units?”

– Calgary Herald

Canadian housing starts trend upwards in April

New housing construction increased in Canada, with seasonally adjusted data exceeding 200,000 units for five months in a row. The increase in the trend was mainly due to apartment construction in British Columbia and Québec, which was partly offset by a decline in Ontario’s multiple starts.

Monthly highlights

  • Apartment construction continues to drive the residential market in Halifax. April saw over 400 additional multiple starts breaking ground, bringing year-to-date multiples starts growth to 169% compared to last year. Demand is being driven in part by the ageing population as downsizing baby boomers are increasingly selling their homes and moving into rental units.
  • Even though the rate of housing starts in the Province of Québec was down in April, the total for the first four months was up by about 30% in the province’s urban centres. This result was mainly due to the significant construction of apartments, especially rental units, in the Montréal and Québec areas. As well, single-detached home starts have been strong so far in 2017, thanks in part to tightening resale market conditions.
  • Despite the slight decline registered in April, residential construction in the Gatineau area showed positive results for the first four months of the year. The gains were particularly strong in the rental segment, with construction getting under way on many seniors’ housing units. Overall, starts were supported by an increase in housing demand and a decrease in the number of unsold units on the new and existing home markets.
  • The trend in housing starts in Toronto remained stable in April, as slight increases in low-rise homes were offset by some declines in apartment starts. Overall, new home construction this year has been building momentum as both new single-detached and townhome starts trended higher to reach a nine-year high in April. Tight conditions in the resale market continue to cause demand to spill over into the new home market.
  • In London, April 2017 single-detached starts were much higher than in April 2016 and the ten year average for April. The gap between house prices in Toronto and London has widened significantly, making new single-detached homes in London that much more appealing to retirees from Toronto who wish to sell their home but not downsize.
  • In Winnipeg, a decrease in inventories in the new home market and balanced resale market conditions are allowing builders to increase production. Actual housing starts in April increased year-over-year for the fourth consecutive month, boosting year-to-date starts to their highest levels since 1987.
  • The trend measure for housing starts in the Kelowna CMA surged upwards again in April, due to an increase in both single-detached and multi-unit construction. In particular, a number of large apartment rental projects are now underway as builders continue to respond to the low vacancies that have characterized Kelowna’s rental market for the past two years.
  • Housing starts in Metro Vancouver trended higher for the first time in four months, led by multiple-family residential construction. Builders are responding to demand in the market as eight in ten townhouses and all apartments were sold at completion during the last two months.

CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of Canada’s housing market. In some situations analyzing only SAAR data can be misleading, as they are largely driven by the multi-unit segment of the market which can vary significantly from one month to the next.


Life After Oil Makes Real Estate Canada’s New Economic Crutch

Two things happened last week that were a reminder of just how vital real estate has become to Canada’s economy.

On Friday, Statistics Canada released gross domestic product data that showed February was a banner month for sectors linked to housing. The real estate industry, residential construction, financial and legal services generated a combined 0.5 percent increase in output, the biggest one-month gain since 2014. Without those, the overall economy would have contracted slightly in February.

A day earlier, the Ontario government released a budget that projects land transfer taxes will surpass C$3 billion ($2 billion) in the current fiscal year, from C$1.8 billion three years ago. For the province, it’s the difference between a balanced budget and a deficit.

Measures of housing’s contribution to the economy are imprecise, but estimates largely put the direct contribution in excess of 20 percent.

It’s much more than that once you add all the indirect effects, with benefits spread widely from lawyer fees to government revenue and increased retail purchases through so-called wealth effects as rising home equity values prompt households to ramp up consumption. The big worry is that Canada has moved from a reliance on oil to a reliance on real estate.

The influence of housing on the economy is so pervasive that it won’t take much of a slowdown to act as a major drag on the economy, said Mark Chandler, head of fixed-income research at RBC Capital Markets in Toronto.

“You don’t need a collapse in house prices, you don’t need housing starts to be cut in half for weaker real estate sector to have a significant effect on GDP and incomes,” Chandler said. RBC’s ballpark estimate is that a 10 percent decline in national home prices would knock a full percentage point off growth.

A Toronto Dominion Bank report from 2015 found the housing wealth effect has been responsible for about one-fifth of all growth in consumption since 2001.

“A lot of the strength we have seen in consumption is housing related,” said Brian DePratto, the economist who wrote the 2015 report. If you strip out the direct and indirect impact from housing on the economy, “you are talking about a much lower trend pace of growth.”

Record Loans

It’s hard to believe, but there was a time not long ago when Canada’s banks lent more to businesses than home owners. It was the norm in fact until the early-1990s, when mortgage loans surpassed business lending for the first time. Residential mortgages today make up about 52 percent of all chartered bank loans, versus 21 percent for business lending.

Still, that portion of business lending is up from a record low of 19 percent in 2012, suggesting that as home valuations become stretched and as mortgage and capital regulations tighten, banks are increasingly looking to companies for lending growth.

A closer look, however, reveals that much of the new business lending is in fact real estate related. Bank of Canada figures show 14 percent of all private business loans from chartered banks are now bound for so-called real estate operator industries, the biggest share in the history of data back to 1981.

The C$27.4 billion in private loans to the sector, which represents companies that own and manage real estate assets, exceeds the combined lending to the manufacturing and oil and gas sectors combined. That’s on top of the C$15 billion loaned to developers, more than double levels in 2010.

The chartered banks are also lending to real estate operators at the fastest rate on record — C$10 billion since the start of 2014.

The pattern makes sense. Profit margins in real estate rental, leasing, and property management industries were around 34 percent in 2015, Statistics Canada data show, and banks want to lend to profitable businesses. Yet, it also means lenders are increasingly exposed to the industry on multiple fronts.