On Monday Statistic Canada sort of released their monthly report on Investment in New Housing Construction for the month of July.
The only problem with the report is that there are no statistics listed or even a summary of the findings.
Typically with most of the Stats Can reports I’ve looked at in the last six months you at least get a summary, usually a couple charts and you can then drill down through the data.
But not this month, at least not for housing starts.
All you can do is review the definitions and a list of sources used and then send away for the report.
At the time, I thought that this was somewhat strange considering the whole purpose of Statics Canada is providing statistics and interpretive summaries and that is what you usually get.
Then today Merrill Lynch Canada came out with a report warning that Canada could be headed to a housing and mortgage meltdown, similar to the US. CBC here.
Household net borrowing in Canada amounted to 6.3 per cent of disposable income in 2007, which is more than households in the U.K. and not far off the peak reached by U.S. households in 2005.And Harper immediately jumped all over this one.
The report also said housing prices are now falling and inventories of unsold homes are rising sharply in Canada, suggesting that this market turnaround will not be a transitory phenomenon.
"I don't accept that conclusion, not at all," Harper told reporters on tour in British Columbia.One of the first signs, if not the first sign that our somewhat smaller real estate bubble is about to burst, is a reduction in housing starts in the middle of the summer.
"We have seen the housing market and the construction market much stronger in Canada than in the U.S.," he said.
A large decrease in July would be a very negative sign that prices are about to dramatically fall.
Lower real estate values on existing homes that are heavily mortgaged via equity loans or initial low down payments lead to pressure on the banks.
Not to mention stress on the owner and caution by the consumer.
I think recessive times are a coming and Harper doesn't want to talk about it right now.