Mounting debt ‘worrying’ as Canadians stretch to chase rising home prices, says Bank of Canada governor

Bianca Bharti
other

 Bank of Canada Governor Tiff Macklem said he’s seeing “worrying” signs in Canada’s hot housing market, in which households are taking on increasing levels of debt to chase rising prices.

The central bank had largely stayed quiet on the housing market until February, when Macklem said it was showing signs of “excessive exuberance” as national real estate prices jumped 25 per cent from the year before.

“Since then, the housing market has continued to run strong across a variety of dimensions; price increases have continued at a pretty high rate,” Macklem said in an interview with the Financial Post on Wednesday.

“If you look at the household indebtedness, you are seeing, on average, the loan-to-value ratios are getting higher, particularly in the uninsured space. That suggests that Canadians are stretching and that is worrying.”

The central bank and other authorities are facing mounting pressure to address the overheating housing market, which the Canada Mortgage and Housing Corporation warned last week is becoming increasingly vulnerable to economic shocks.

However, CIBC’s deputy chief economist Benjamin Tal warned that just because the housing market is hot, does not mean the central bank should act.

“That’s not his domain, that’s the finance minister’s domain,” he told the Post. “People have to understand that he will cross the line if he starts talking about microprudential policies.”

Macklem himself stopped short of suggesting a policy response is necessary.

What gets us worried is when you start to see extrapolative expectations, or people starting to speculate on this, and houses become assets as opposed to something we live in

Bank of Canada Governor Tiff Macklem

“From our perspective, monetary policy is a blunt tool. It’s a macro-economic instrument. We have to look at the whole economy. The whole economy needs monetary policy support to support the recovery, get people back to work and get inflation back on target,” he said.

Tal reiterated Macklem’s view.

“The housing market is one part of the economy,” he said. “As a society, we have never been so sensitive to the risk of higher interest rates…. Every small increase in the interest rate can have a significant impact on the housing market and therefore, (Macklem) would like to see the market slow down before we have to raise interest rates.”

While the market continues to rise, some of Canada’s biggest banks have been leading the calls for a policy response of some kind.

In a report on Monday, Royal Bank of Canada senior economist Robert Hogue said the near-term outlook for homebuyers is “grim.”

“Smaller markets are losing some of their affordability advantage, which adds stress to buyers willing to move to a different town to find a home they can afford,” he wrote.

Last week, Hogue said policymakers needed to address the “overheating” in markets as it threatens to destabilize the economy, suck money from more productive areas and exacerbate inequality.

Bank of Montreal senior economist Robert Kavcic, in a Tuesday report, said “policy makers need to act immediately, in some form, to address the home price situation before the market is left exposed to more severe consequences down the road.”

While the state of the market can be explained to some extent by a fundamental shift in demands, there are other factors, like speculation, at play, the governor said.

“What gets us worried is when you start to see extrapolative expectations, or people starting to speculate on this, and houses become assets as opposed to something we live in. There certainly are some signs of extrapolative expectations,” Macklem said.

“If Canadians are basing their decisions on the kinds of price increases that we’ve seen recently are going to continue indefinitely, that would be a mistake. They’re not sustainable.”

 

© 2021 Financial Post

Fraudster gets away with transferring title for B.C. home using forged passport

Susan Larazuk
The Vancouver Sun

Fraudsters impersonated owners of B.C. residential properties to steal the homes’ titles and one of the con artists got away with it, according to the agency in charge of keeping title transfers secure.

The Land Title and Survey Authority of British Columbia announced the fraud attempts, “one of which was successful,” and advised those in the real estate industry to increase their vigilance when dealing with clients.

“Legal and real estate professionals play a critical role in preventing title fraud,” said the authority in a release.

The perpetrator of the fraud laid the groundwork by posing as the owner of a B.C. property, an owner who lived abroad and was renting the home out. He sent the property manager instructions from a phone number and email address that didn’t match the ones authorized by the real owner.

The property managers then “shared documents (with them) that allowed the fraudster to impersonate the owners,” said the LTSA.

“Both properties were listed for sale by realtors,” it said.

The realtors had accepted a scanned copy of the impersonator’s passport, which turned out to be forged, to verify the supposed owner’s identity.

Then a legal professional hired by the fraudster also accepted the scanned copy of the false passport, and he “assisted the fraudster in transferring title to the property.”

“Forged South African passports were used in both cases but (fraud) can come from anywhere,” said the LTSA, which is responsible for the security of titles to B.C.’s private real estate properties.

The LTSA didn’t return a request for comment and it’s unclear how the fraudster was able to persuade the professionals to bypass the requirements to verify identity set out by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), whose role it is to detect, prevent and deter money laundering.

LTSA, in its release, advised local industry professionals to “be suspicious of requests from clients who live abroad to change their phone or email address.”

They should also “be careful of clients who express urgency or provide unusual instructions, such as listing the property for below market values or instructing you not to use the multiple listing service (MLS) or for sale signs.”

A company that sells title insurance to protect buyers and owners against title fraud said an identity of an out-of-country seller is required to be verified by a professional third party because “someone needs to see the ID.”

“But this could be a professional fraudster and they’re good at what they do,” said Tony Spagnuolo of Spagnuolo and Co.

He said the title would remain with the rightful owner and the buyer would likely have insurance as it is required by most lenders as a condition of the mortgage.

FINTRAC said in a statement it doesn’t investigate cases so couldn’t comment on the details of the case, including whether or not the professionals were fined.

 

© 2021 Vancouver Sun

Canadas housing market set for “significant cooldown” after homebuying frenzy: TD

Sean MacKay
Livabl

The current furious pace of homebuyer activity, along with rapidly accelerating price increases seen since mid-2020, are unlikely to last into 2022.

While the Canadian housing market’s strength was a major contributor to the country’s economic recovery following the devastation experienced last spring, TD Senior Economist Sri Thanabalasingam believes a “significant cooldown” is coming over the next six to nine months.

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In commentary exploring Canada’s “pandemic economy” after a year spent coping with the myriad effects of COVID-19, Thanabalasingam writes that the initial fears at the onset of the pandemic around the country’s housing market were focused on risks of collapse rather than of overheating.

But while they generated some alarming headlines based on inaccurate predictions, fears of collapse quickly faded through the summer as homebuyers took the market by storm.

“Rock-bottom mortgage rates, relatively secure employment for higher paid workers, and a desire for more space while working from home, generated extraordinary homeownership demand beginning in the summer of 2020 and has yet to fade,” writes Thanabalasingam.

Now concerns around overheating have taken over, as single-family home prices at the national level have gained $100,000 in value on average just over the last six months amid historic demand and limited supply. Market experts are now penning what essentially amounts to open letters to policymakers on actions they can take to cool the market.

Thanabalasingam believes that some segments of the market “have moved well above their levels supported by [economic] fundamentals.”Mortgage rate increases and a lack of affordable housing options for many buyers should lead to a “tapering off of price growth,” he writes.

If this doesn’t take enough steam out of the market, the economist predicts that regulators and governments will spring into action on the policy front with measures to protect the financial system from a runaway housing market. 

“Either way, we are likely to see a significant cooldown over the next 2-3 quarters,” writes Thanabalasingam.

Earlier this month, RBC Senior Economist Robert Hogue recommended an array of policies to stabilize the market that included increasing the supply of housing through new home and rental construction, rolling out measures aimed at discouraging speculation and potentially tightening up mortgage-lending rules even beyond what was enacted by the federal government in 2018.

 

© 2020 BuzzBuzzHome Corp.

CIBC’s Tal: Red-hot activity posing significant long-term risks to housing

Ephraim Vecina
Mortgage Broker News

Is the currently overheated activity in major markets undercutting the housing segment’s future prospects? Benjamin Tal of CIBC Capital Markets Inc. seems to think so.

Tal noted that this alarming trend is especially apparent in Toronto, where low interest rates have pushed property investors towards the condo market despite the spectre of considerable losses in the near term.

“It’s really about the supply-demand mismatch and people are looking at interest rates, they know … interest rates will rise,” Tal said in an interview with BNN Bloomberg. “So basically, they’re stealing activity from the future in order to be part of this low interest rate environment and take advantage of it.”

The market’s condo sales activity increased by 85.5% annually in January, according to the Toronto Regional Real Estate Board. A major driver of this is the fact that the asset class represents “a more affordable entry” into the market compared to single-detached units.

Tal cited recent CIBC research that found investors were being forced to absorb losses to the tune of hundreds of dollars monthly, and yet choosing to keep their hold on the properties due to expected longer-term value.

Such is a recipe for significant price growth, Tal cautioned.

“If you think that Toronto is unaffordable now, you wait,” Tal said. “Toronto is becoming like Berlin, like London, like Manhattan. It’s becoming more and more unaffordable, and therefore we know that our kids will struggle.”

 

 

Copyright © 2021 Key Media

Downtown Vancouver condo sales rebound after 2020 slump

Michelle McNally
Livabl

 

Nearly one year after condo sales sunk at the onset of the COVID-19 pandemic, new data shows that buyers have been returning to downtown Vancouver’s high-rise market.

According to recent research and reporting by The Georgia Straight, 105 condo properties were sold in Downtown Vancouver West — a major part of the city’s core — during February 2021. Although this region does not include other central areas like Coal Harbour, Yaletown and the West End, the 105 condo sales represent the largest volume in the past year within the downtown community, the Straight explained.

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Using information sourced from Real Estate Board of Greater Vancouver (REBGV) and Zealty.ca, an online Vancouver property database, the Straight noted that the 105 unit sales in February represent a 52.2 percent month-to-month increase from January 2021. Twenty-nine of those 105 sales were reportedly sold at or above asking price.

Overall, prices in the area did not show a significant change when compared to the previous month, with the median condo price in Downtown Vancouver West dipping by a negligible 0.1 percent monthly to $699,000 in February 2021. The condo price per square foot has also made progress since the April 2020 slowdown, having risen from $1,030 that month to $1,247 in February, according to the article.

The Straight reports that condo sales in Downtown Vancouver fell to 29 units in April 2020, when the global pandemic tanked the local condo market. At that time, the median price of a condo hit its lowest point at $680,000. Sales slowly recovered throughout 2020 and the area recorded 82 unit sales by December.

Like other major cities across the country, Vancouver’s condo market slowdown has been attributed to buyers favouring larger single-family homes, resulting in significant sales activity in suburban communities. The urban exodus, which sees city dwellers move outward to smaller communities, has been referenced in market commentary since the beginning of the pandemic. In its reporting, the Straight mentions that, “while many are still willing to drive out to the suburbs in search of homes, purchasers seem to be enamoured again by the charms of downtown living.”

In its latest market report, REBGV said there were 1,759 condo sales in February across Metro Vancouver, a 65.8 percent increase from the same period a year ago. Price wise, Vancouver apartments experienced a mild increase, climbing 2.5 percent from both February 2020 and January 2021 to $697,500

 

© 2020 BuzzBuzzHome Corp.

Bricks-and-mortar stores anchor B.C.’s biggest developments

Frank O’Brien
Western Investor

— Oakridge Centre makeover includes 1 million square feet of retail. | Chung Chow

Don’t look up from your shopping screens, but bricks-and-mortar retail is now the foundation for B.C.’s biggest real estate developments and more than $600 million in investments, a year after the start of a pandemic that was forecast to drive the final nail into the coffin of storefront shopping.

The metrics do appear brutal.

Vacant retail space tripled in the second half of 2020, the biggest increases on record, pushing Metro Vancouver’s vacancy above 4 per cent.

“Vacancy rates in the retail sector are expected to move up dramatically into 2021, leading to a decline in market rents. On the demand side, 40 brands announced the closing of all their stores in Canada since March 2020 representing 1,100 stores that will close in 2021,” states a retail outlook released in February by Fiera Realty, and among the many gloomy forecasts for the sector.

Canadian retailers finished 2020 with $606 billion in sales, down 1.4 per cent from 2019. This was the largest annual decline since the 2009 recession, according to Statistics Canada, but lower than many expected when COVID-19 began.

B.C. was an outlier, posting a 2.3 per cent year-over-year increase in consumer spending in 2002 to lead the entire country.

However, despite a 70 per cent surge in online shopping last year, e-commerce accounted for less than 6 per cent of Canada’s total retail trade in 2020.

If face-to-face retail is indeed at deaths door, some of B.C.’s largest and most experienced developers failed to get the memo.

This year, approximately 3.2 million square feet of new retail space is either under construction or nearly complete from downtown Vancouver to the eastern Fraser Valley.

Shape Properties is now ushering the latest big-name tenants into 1.1 million square feet of retail space recently finished at its Amazing Brentwood development in North Burnaby. A few SkyTrain stops later, more than 1.5 million square feet of shopping space is the foundation of the $7 billion City of Lougheed development, also by Shape, on the Burnaby-Coquitlam border.

Latimer Village, the largest mixed-use development in the Township of Langley, includes 34,000 square feet of retail space and 60% of the space is leased though it won’t complete until 2022.

In South Surrey, Bosa Commercial included 50,000 square feet of retail in its twin-tower Miramar Village that completed late in 2020. Retail is also embedded in the majority of the new office and residential towers arising in Surrey’s downtown.

In downtown Vancouver, QuadReal’s Post development – one of the largest new commercial projects in B.C. – will include 185,000 square feet of retail, anchored by a massive 50,000-square-foot Loblaws, which will be the largest grocery store downtown when it opens next year.

Cadillac Fairview’s flagship Pacific Centre mall is replacing its landmark Georgia Street annex to add 14,000 square feet of retail over three floors, with all the space claimed for a new Apple outlet.

The 28-acre Oakridge Centre is touted as the single biggest real estate development in Vancouver’s history, according to co-developers QuadReal Property Group and Westbank Corp. It will deliver nearly 500,000 square feet of new retail, including a massive new Hudson’s Bay store, when it opens in 2024. The existing 574,000-square-foot shopping centre will be transformed into a 4.5 million square foot hub of retail, residential, workspace, parks, and civic space,

But bricks-and-mortar retail is the foundation of it all.

Investments in retail

Meanwhile, existing retail properties in B.C. continue to be in demand.

In the fourth quarter of 2020, sales of Metro Vancouver retail properties soared 50 per cent in total volume compared to the same period in 2019, according to Altus Group, which expressed “surprise” at the increase.

In all, Avison Young reports, sales of retail property in B.C. in 2020 reached 46 deals valued at $606 million. In terms of dollar volume, the overall value fell to its lowest point since 2009, but sales increased sharply as the year ended.

The $276 million in sales during the last three months of 2020 included the 139,000-square foot Trenant Park Square, a Delta shopping centre, which sold for $64.5 million to Keltic Canada Development, and the December sale of London Plaza in Richmond, closing for $57 million The 108,000 square foot plaza was sold by the Investors Group to a private investor for $538 per square foot.

Some of the larger Metro retail asset sales, agents suggest, are for future mixed-use development, likely with a larger retail component and residential.

Vancouver Island posted the largest retail asset sale in the second half of 2020, with the Woodgrove Centre in Nanaimo transacting to a new, private investor who immigrated from China, for $99.9 million.

“Investor’s and developers are not wrong. We will see a gradual bricks and mortar revival,” said Neil McAllister, senior vice-president, retail, with Lee and Associates, a Vancouver real estate agency.

“Online shopping has made huge gains, especially due to the pandemic, but consumers are experiencing shipping errors, hassle of returns and even increased pilferage of packages. There is an opportunity for bricks- and-mortar retailers to regain lost market share,” McAllister said.

 

© Copyright 2020 Western Investor

Affluent millennials and wealthy families sitting on a pile of cash are the latest drivers of high-end Canadian real estate

Avery Mullen
The Vancouver Sun

 Sales of homes valued at $4 million or more in the Greater Toronto Area saw a 157 per cent jump in activity. Photo by Tyler Anderson/National Post

The rise of affluent millennials, wealthy families sitting on a cash pile and remote-working trends have created a ‘perfect storm’ in the world of high-end real estate, according to a new report.

Sales of homes valued at $4 million or more in the Greater Toronto Area saw a 157 per cent jump in activity, while Vancouver saw a 41 per cent increase in the first two months of the year compared to the same period last year, according to Sothebys International Realty Canada, a high-end real estate broker.

“We’ve seen shifting homeowner and buyer needs,” Don Kottick, Sotheby’s Canada CEO, told the Financial Post in an interview. “There have been foundational changes in what people want from their home and what they look for in their home. And so that’s impacting the business.”

Sales activity in homes above $1 million in Montreal jumped 27 per cent during the period, while Calgary has also emerged from its deep freeze, with residential sales of more than $1 million up 119 per cent. Prices and sales have increased not only in major urban centres, but also in cottage country, such as the Muskoka and British Columbia’s Okanagan Valley regions. Sotheby said it did not aggregate data for all of 2020.

With economic shutdowns preventing younger consumers from spending money, many millennials are looking to invest their newfound savings in real estate. And they are tapping into low interest rates to buy higher-end properties, often with the help of cash-rich parents. Canadian currency and deposit holdings increased a whopping $205 billion over the past year, according to Royal Bank of Canada.

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According to Mortgage Professionals Canada, about 4.5 or 5 per cent of Canadian households buy a home in a typical year, but that may have recently increased by as much as 1 or 1.5 percentage points. Older homeowners, meanwhile, are staying put.

A 2020 report by Sotheby’s and Mustel Group found that about 80 per cent of older homeowners planned to stay in their homes for as long as possible. Kottick believes the rising demand will also be bolstered by a coming influx of international buyers, as COVID-19 vaccines make travel more feasible. Instability in places like Hong Kong and political divide in the United States means that both Canadian expats and new immigrants are likely to consider moving to Canada.

Internationally, he said, Canada’s status as an emerging financial centre and technology hub makes it appealing to foreign buyers looking for an affluent and stable destination. Toronto is now considered the second largest financial centre in North America, according to government-backed think-tank Toronto Finance International.“The fact that we have technology and we have our financial system, that’s driving probably more people internationally to take a look at us,” said Kottick. “We’re safe, we have stable government, we have resources, so we have a lot of things that are making us attractive at a global level.”

He is concerned, though, that the market’s future outlook could be hampered by a possible attempt by government to address housing affordability problems by dampening demand across the entire real estate market. “Government really need to focus on creating more supply in all areas of the housing market,” Kottick said. “That is the only thing that is going to correct our problem with the shortage and with affordability.”

In December, in an effort to lower real estate prices, the federal government vowed to levy additional taxes on foreign buyers living outside Canada. And in 2016, the government of British Columbia imposed a tax on foreign buyers that saw foreign sales drop to almost zero by 2020, according to the B.C. Real Estate Association. The Ontario government also imposed a tax on foreign real estate buyers in 2017.

Mortgage Professionals Canada chief economist Will Dunning said the previous attempts by government to suppress housing prices by reducing demand, such as through taxation, have likely deterred the creation of new supply and potentially worsened the problem.

He suggested that one way to address the supply-demand gap might be to encourage existing homeowners to sell their properties, noting that his role at Mortgage Professionals Canada is that of a consultant and he was not speaking behalf of the organization. Dunning suggested eliminating or reducing the land transfer tax, given that home sellers often face moving costs of around eight or ten per cent of the value of their homes, including paying the transfer tax on their new residence. Lowering the cost of buying a new home could make them more willing to put their existing properties on the market.

“The government’s need to raise revenue, I totally get that,” Dunning said. “But I think the land transfer tax is a very inefficient tax… I would much rather the government education and municipal taxation be done through the ongoing realty tax, rather than one enormous tax.”

Kottick said removing the transfer tax might make a small difference to housing supply across the entire spectrum of the market, but added that systemic changes to reduce red tape around new housing and encouraging developers to start new projects is likely to have a greater effect.

“Give developers incentive so they want to bring more inventory in. That’s the fastest way,” Kottick said. “That’s the only thing that’s going to be a long-term solution. It could be looking at land use, allowing certain land to have different building codes that encourage multi-dwelling buildings.”

 

© 2021 Vancouver Sun

Two Victoria real estate agents fired after online accusations of sexual assault

Louise Dickson
The Province

 The Agency Victoria, a luxury real estate brokerage and lifestyle company, says it has terminated its relationship with two agents, effective immediately, after allegations of sexual assault. Photo by CHEK NEWS /Times Colonist

Warning: This story contains details of sexual assaults.

VICTORIA — Two male real estate agents were fired Thursday after women posted allegations of sexual assault on social media. Three women made the detailed allegations on the Vancouver Island Instagram account @survivorstoriesprojects.

“I want my story to be told because they have been continuing to do the same thing to girls and it needs to stop. I thought I was the only one but sadly that isn’t the case,” the first woman wrote in her anonymous online post.

The Agency Victoria, a luxury real estate brokerage and lifestyle company, responded to the allegations on its own Instagram account, saying it had terminated its relationship with the agents, effective immediately.

“As previously stated, we are aware of the very serious social media allegations towards two agents working under our brokerage. We want to be perfectly clear; we are shocked and deeply disturbed by the allegations … We stand in full support of women who have endured sexual abuse and we encourage anyone with information to come forward.”

The Local restaurant also responded to the allegations against one of the men, who is a minority partner. Owner Jeremy Petzing said he and the whole Local community were shaken by the allegation.

“The actions described are disturbing, disgusting and wrong. Our thoughts are first and foremost with the women who brought forward these allegations. Since learning about the accusations we have severed ties with the persons involved. They will not be welcome at The Local or Farmhouse.”

The first woman said the men are regular cocaine users who are part of an affluent circle in Victoria. They are known to send out multiple snap chats or messages to women in Victoria, inviting them to hang out or meet for drinks. The two men choose girls who are unlikely to come forward after an assault, the woman said.

One man always pretends to be alone. When the woman shows up at the agreed venue, his friend is with him. The two pay the bill when the woman arrives and say they are going to a new spot. But on their way to the next bar, they say they have to “pop into the office” quickly.

The woman said she was taken to a real estate office downtown. The men pulled out a bottle of wine and cocaine and said they wanted to do a few hits before moving on.

She became more and more intoxicated. She said she doesn’t do cocaine, and believes she was drugged. When she came to, the room was spinning. One of the men was performing oral sex on her, while the other was sitting on her face, she said.

 

The assault continued until she said she was going to be sick. She woke up by the toilet alone, rinsed her face and drank water from the faucet. She asked for her clothes and they left the office and put her in a cab.

When she protested, they told her nobody would believe her, she said.

The second woman wrote that she was 19 when she had a drink at the home of one of the men. They went into the bedroom, and then his friend showed up. The men started taking off her clothes and she told them to stop, but they told her to be quiet, she said.

She started to cry. She managed to get out of bed and locked herself in the bathroom. She was scared and didn’t know where she was.

“I decided to keep it a secret because I was terrified,” she wrote.

The two men showed up at her workplace the following Monday, she said. The woman wrote that she didn’t go out for some time because she was scared of running into them.

“I thought I was the only one, but sadly that wasn’t the case.”

The third woman wrote about making out with one of the men, and his roommate insisted on being part of it. The two men forcefully tried to take off her clothes and hid her purse so she couldn’t leave, she wrote.

Their behaviour was “predatorial and creepy to the point where I had to get aggressive and I remember grabbing my things as fast as I could and leaving,” she wrote.

 

© 2021 The Province

Vancouver 33-suite rental building sells at full list price of $10.5 million

Goodman Commercial Inc.
Western Investor

— Goodman Commercial Inc., Vancouver, for Western Investor

Property type: Multi-family rental

Location: 8755 Laurel Street, Vancouver

Number of units: 33

Lot size: 19,310 square feet

Lot size in acres: 0.44 acres

Zoning: RM-3A

List price: $10.5 million

Sale price: $10.5 million

Brokerage: Goodman Commercial Inc., Vancouver

Brokers: Mark Goodman and Cynthia Jagger

 

© Copyright 2020 Western Investor

More than half of ‘hard-hit’ businesses will not survive 2021

Elana Shepert
Western Investor

— Many pubs and restaurants have already closed.| Chung Chow

While many businesses in Vancouver and across Canada closed in the early months of the coronavirus (COVID-19) pandemic, many others continue to struggle financially. 

Now, the Coalition of Hardest Hit Businesses says the findings of a Canada-wide survey show that the firm majority of hardest-hit businesses–60 per cent of them–will not survive if the Canada Emergency Wage Subsidy (CEWS), as well as the Canada Emergency Rent Subsidy (CERS), are not extended past the June 5 deadline to the end of the year.

The Coalition of Hardest Hit Businesses is an industry-driven group of over 100 stakeholders representing a variety of sectors including tourism, travel, arts and culture, events and festivals, accommodation and hospitality. 

Based on its survey results, the Coalition is formally appealing to the Federal Government to provide certainty and announce an extension of the CEWS and CERS supports to the end of the year for the hardest-hit sectors in the April budget. 

“Our businesses were the first hit by the pandemic, the hardest hit by closures, and will be the last to recover. With extended support, we can thrive and survive. Without it, Canada’s tourism, culture and hospitality industries will be devastated for a generation,” announced Beth Potter, President and CEO of the Tourism Industry Association of Canada. 

Extension of the CEWS and the CERS program would be a “lifeline”

Prior to the pandemic, businesses that comprised the Coalition employed over 2 million Canadians, explains a release. Employees of these businesses are “predominantly women, young people, Indigenous and new Canadians”– and these groups have been particularly impacted by the pandemic.

Susie Grynol, President and CEO of the Hotel Association of Canada, says that extending the CEWS and the CERS program would be a “lifeline” for businesses impacted by the ban on mass gatherings. 

Similarly, Martin Roy, Executive Director of Festivals and Major Events, added that many festival and event organizers are nearing the point where they need to decide if they need to cancel planned activities. “Chances are, they are going to once again miss out on the opportunity to generate their revenues for the year. Other sectors of the economy may begin to recover as restrictions ease, but the events sector will not be in a position to do so and will require continued government support until a return to normal occurs.”

And while Potter acknowledges that the summer will likely see an easing of restrictions, decisions to “cancel conventions this fall have already been made.” 

The Coalition also stressed that efforts to safely stimulate domestic tourism, lower interprovincial travel barriers and reopen international borders are critically important. But such measures must be accompanied by critical support programs to ensure that highly affected sectors can bridge to the other side.

 

© Copyright 2020 Western Investor