Canada’s family business boom is helping lift Canada’s middle class
Posted On July 16, 2021
Businesses and investors are flocking to Canada’s biggest cities and growing rapidly, helping lift the fortunes of the middle class.
Canada’s annual economic growth rate in the fourth quarter was 7.1 percent, a gain of nearly a percentage point from a year earlier.
That was more than double the growth rate for the United States, which was 5.6 percent.
It was the fastest growth rate among G7 countries and up from 5.3 percent in the third quarter.
It is a sign that the country is on track to grow its middle class, as a share of the population, for the first time since the 1970s.
The median Canadian household income grew 4.7 percent from the fourth to fifth quarter of last year, the fastest pace of growth since the third quarters of 2015 and 2016.
That’s a rise of $2,000 per household.
Canada’s economy is the fastest-growing in the G7.
It is the largest economy in the Group of Seven.
The Bank of Canada, Canada’s central bank, said Tuesday it would continue to hold interest rates low as it considers ways to spur growth and investment.
“We will continue to focus on low- and intermediate-term rates and keep our monetary policy accommodative,” the central bank said in a statement.
Canadian businesses have continued to grow faster than their peers in the world.
The top 10 sectors of Canada’s economy grew 4 percent, compared with 3.5 percent growth in the United Kingdom, 3.4 percent in France and 3.3 per cent in Germany.
Investors have been buying more Canadian real estate.
The value of new homes in the country increased by $6 billion to $1.5 trillion in the first six months of 2017, according to real estate agency CREA.
In addition to home sales, Canadian realtors have also been busy finding homes for sale in other parts of the world, especially in Asia.
While Canada is seeing more foreign demand, investors are still buying Canadian real Estate.
A record $6.9 billion in foreign direct investment was made into Canadian real property last year.
The country’s gross domestic product (GDP) rose 3.9 percent in 2016, the biggest annual gain since the mid-1990s.
China is the biggest foreign investor in Canada, and its economy grew at 5.5 per cent last year while the U.S. and Europe were growing at about 1.6 per cent and 1.5 pct.
Foreign buyers have been the biggest beneficiaries of the housing boom in Canada.
Real estate agent Kevin MacLeod of the Greater Toronto Area Real Estate Board said foreign buyers are buying up more of the country’s real estate than they used to, as they do with other Canadian cities.
That has also been reflected in the prices of condos.
Toronto, the largest Canadian city, has seen a boom in new condominiums and condominium towers, but the prices have come way down from the peak in the 1980s.
Developers are making the most money selling condominium units at record prices.
Last year, Canada sold more condos than all but three other countries in the top 10.
The U.K. was the only other country that sold more than 50 percent of all units sold in the U.-Korea, China and Russia markets.
MacLeod said foreign investors are also helping to lift Canadian households.
He said foreign owners of condos are buying the homes at record sales prices.