Scotiabank Strategy & Financial Objectives
Canadian Housing Fundamentals Remain Sound
Steady population and household income gains, low interest
rates and continuing immigration are underpinning demand
High household debt supported by continuing low debt service
costs, low unemployment and significant home equity
Unemployment rate remains low and stable
Structural considerations, strong underwriting discipline and
conservative lending policies are reflected in low delinquency
rates
Affordability strain observed in select markets
1.0
Residential Unit Sales to New Listings
ratio
0.9
0.8
Seller's Market
0.7
0.6
0.5
Balanced
Market
0.4
0.3
Buyer's Market
0.2
0.1
0.0
90 92 94 96 98 00 02 04 06 08
Source: CREA MLS, Scotiabank Economics. Data through July 2016.
10 12 14 16
Mortgage Debt Service Ratio
7
% of disposable income
6
High Percentage of Equity
Residential Mortgages Arrears
6
80
real estate equity as % of
% of mortgages in arrears
Canada
real estate assets
3 months or more
75
5
70
Mortgage Interest Payments
4
65
LO
5
4
3
2
1
40
0
35
GG OG
60
55
50
45
90 92 94 96 98 00 02 04 06 08 10 12 14 16
Source: Statistics Canada, Scotiabank Economics.
Data through 2016Q1.
U.S.
3
2
1
0
U.S.
Canada
90 92 94 96 98 00 02 04 06 08 10 12 14 16
Source: Statistics Canada, U.S. Federal Reserve, Scotiabank Economics.
Data through 2016Q1.
90 92 94 96 98 00 02 04 06 08 10 12 14 16
Source: CBA, MBA, Scotiabank Economics. Data through 2016 Q2.
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