Paul Vieira, Financial Post · Monday, Jan. 17, 2011
OTTAWA — Finance Minister Jim Flaherty unveiled changes Monday morning to mortgage lending rules that would see Ottawa stop backing home loans greater than 30 years and make it more difficult for households to use their property to access financing.
The changes, as reported by the National Post on Sunday, emerged as worries escalate among Bay Street leaders and the Bank of Canada about the record levels of household indebtedness, and how conditions could deteriorate unless pre-emptive action was taken.
The key change announced is that mortgages with amortization periods longer than 30 years will no longer qualify for government-backed mortgage insurance, which is required for buyers with less than a 20% down payment on a home. The previous limit was 35 years.
Also, Mr. Flaherty lowered the maximum amount Canadians can borrow against the value of their homes, to 85% from 90%, on a refinancing; and removed federal government backing for home equity lines of credit, or so-called HELOCs, whose popularity soared in the past decade with growth double that of mortgage debt.
"Canada's well-regulated housing sector has been an important strength that allowed us to avoid the mistakes of other countries," Mr. Flaherty said at a media conference. "The prudent measures announced [Monday] build on that advantage by encouraging hard-working Canadian families to save by investing in their homes and future."
Executives at Bank of Montreal applauded the government's move.
“The actions announced are prudent, measured, responsible and timely,” said Frank Techar, president of personal and commercial banking at Bank of Montreal.
The changes will be implemented in stages, with adjustments on amortization and refinancing limits coming into force on March 18. Government backing on HELOCs will be removed as of April 18.
The government said exceptions would be allowed after the new measures come into force when needed to satisfy a home purchase or sale and financing agreement struck before the March and April in-force dates.
The minimum down payment, at 5%, will remain as is. Further, there are no plans to target condominium purchases by requiring monthly condo fees be added to the list of expenses that is measured against income to decide whether a buyer can afford a mortgage.
Analysts at Scotia Capital said in a morning note the changes had been anticipated for some time. “We remain of our long-held belief that Canada is tapped out on housing and household finance variables that are all at cycle tops, in contrast to the U.S. that has already moved well off cycle tops and may be creating some pent-up demand,” said economists Derek Holt and Gorica Djeric.
The changes to the country’s mortgage rules -- the second in as many years -- emerge amid rising concern about the record levels of household debt, which measured as a ratio of money owed to disposable income nears a startling 150% as of the third quarter of last year. That surpasses the level of debt held by American households, whose appetite for borrowing helped stoke the financial crisis of a few years ago.
The Bank of Canada recently warned debt levels are growing faster than income, and the risk posed by consumer indebtedness to the domestic economy would continue to escalate without a “significant change” in how consumers borrow and banks lend.
Bank of Canada governor Mark Carney said policymakers have a “responsibility” to look at the benefits of pre-emptive action. Joining the chorus have been chief executives at the big banks, most notably Ed Clark at Toronto-Dominion Bank, in publicly advocating for tougher mortgage standards.
Last Friday, Prime Minister Stephen Harper acknowledged his government was considering changes to the rules governing mortgages.
In February of 2010, Mr. Flaherty moved to toughen up the mortgage rules amid worries that Canada was in the midst of a housing market bubble. The reforms, since introduced, compelled borrowers to meet standards for a five-year fixed-rate mortgage, even if the buyer wanted a shorter-term, variable rate loan; reduced the amount Canadian can borrow against their home, to 90% of the property value from 95%; and require purchasers of rental properties to issue a 20% down payment as opposed to 5%. The moves played a role, observers say, in slowing down real estate activity.
The Scotia Capital analysts suggested government regulation was the way to go in terms of curbing household appetite for credit as opposed to the Bank of Canada raising interest rates, which they said would be “imprudent” at this time.
The central bank issues its latest rate statement on Tuesday and it is expected to hold its benchmark rate at its present 1% level as signs indicate the economy may be benefiting from renewed business and consumer confidence in the United States.
Stewart Hall, economist at HSBC Securities Canada, said the extraordinarily low-rate environment “provides all the incentive to consumers to borrow and spend and none of the incentive to save. You can try to [regulate] that away but that is apt to be fraught with significant frustration.”
Read more: http://www.financialpost.com/personal-finance/Flaherty+tightens+mortgage+rules/4119505/story.html#ixzz1BIhkDuhh
Monday, January 17, 2011
Friday, January 7, 2011
Housing market should be resilient in 2011 thanks to low interest rates
Sunny Freeman, The Canadian Press
TORONTO - The Canadian real estate market will follow a similar pattern this year as that seen in 2010 as buyers pull sales forward into the early months in anticipation of higher interest rates, according to a report from one of Canada's largest real estate firms.
The aftershocks of the recession, including a lingering low interest rate environment, will continue to influence the Canadian real estate market in 2011 — a year that will be stronger than expected, said the report released Thursday by Royal LePage.
Royal LePage predicts that average home prices will rise three per cent to $348,600 in 2011, driven largely by a rush to buy in the first half of the year in advance of anticipated interest and mortgage rate hikes in the second half.
“Canadians realize that interest rates are unsustainably low and that homes will become effectively more expensive when mortgage rates return to normal levels," said Phil Soper, president of Royal LePage.
“2011 is expected to unfold much like 2010, when close to 60 per cent of sales volume occurred in the first half of the year in anticipation of interest rate increases that never materialized."
However, the number of transactions will be slightly lower than last year and activity will be modestly closer to the norm because the pull forward phenomenon last year was exacerbated by a tightening of mortgage qualification rules and the introduction of the HST in Ontario and British Columbia in the middle of the year.
Soper said the extension of low mortgage rates will be an unexpected boon to the market this year.
“Like many Canadians, we anticipated an end to the ultra-low interest rate era before year-end 2010," he said.
"Paradoxically, global economic weakness, particularly in the United States, allowed policy-makers and financial institutions to keep borrowing costs low, resulting in a stronger Canadian housing market and a better than forecast fourth quarter.”
Average house prices rose between 3.9 per cent and 4.6 per cent in the fourth quarter of 2010, while price appreciation is expected to continue a moderate and steady climb throughout the current year.
The report contrasts with some recent predictions by economists that prices should remain flat or decline over the next year.
The Canadian Real Estate Association has predicted prices will fall by 1.3 per cent to a national average of $326,000, this year, tied to weakness in British Columbia and Ontario — the hottest real estate markets of 2010. It has also forecasted a nine per cent decline in sales.
CREA has yet to release year-end data for 2010, but preliminary reports from two of the biggest markets, Toronto and Vancouver, released this week indicate 2010 declined as expected.
Sales were down by one per cent compared with 2009 in Toronto, while the average home selling price was $431,463, up nine per cent from 2009.
In Vancouver, sales declined 14.2 per cent from 2009, and were 10.3 per cent below the 10-year average for sales in the region. The average selling price in B.C.'s largest city was up 2.7 per cent at $577,808.
Canada's real estate market has been on a rebound over much of the past year after sales dried up in late 2008 and hit a multi-year low in January 2009.
The housing market's sudden plunge was sparked by a credit crunch that developed in the U.S. housing and lending industries, and gradually spread across the globe, causing a worldwide recession in the late summer and early fall of 2009.
The commercial real estate market experienced a similar plunge as investors lost confidence in the sector. However, the commercial market, which includes office and retail spaces, had a stronger than expected year in 2010 and that momentum is projected to strengthen throughout 2011, according to a report released Thursday by CB Richard Ellis Ltd. Some market observers had predicted a glut of vacancies in Canada's major business centres, but that didn't happen, said John O‘Bryan, vice-chairman of CB Richard Ellis Canada.
We‘ve had good news over the past twelve months with respect to interest rates, housing trends and employment gains, with many companies announcing plans for expansion, he wrote in the report.
"2011 may well be another good, stable year but should be viewed with cautious optimism in light of the concentration in employment growth on part-time jobs rather than the full-time positions that indicate confidence in long-term, sustainable growth."
http://ca.finance.yahoo.com/news/Housing-market-resilient-2011-capress-4179400062.html?x=0
SO BEST TO CONSIDER BUYING NOW OR SELLING NOW IN FIRST HALF OF 2011 BEFORE INTEREST RATES RISE! Cheers Roy
TORONTO - The Canadian real estate market will follow a similar pattern this year as that seen in 2010 as buyers pull sales forward into the early months in anticipation of higher interest rates, according to a report from one of Canada's largest real estate firms.
The aftershocks of the recession, including a lingering low interest rate environment, will continue to influence the Canadian real estate market in 2011 — a year that will be stronger than expected, said the report released Thursday by Royal LePage.
Royal LePage predicts that average home prices will rise three per cent to $348,600 in 2011, driven largely by a rush to buy in the first half of the year in advance of anticipated interest and mortgage rate hikes in the second half.
“Canadians realize that interest rates are unsustainably low and that homes will become effectively more expensive when mortgage rates return to normal levels," said Phil Soper, president of Royal LePage.
“2011 is expected to unfold much like 2010, when close to 60 per cent of sales volume occurred in the first half of the year in anticipation of interest rate increases that never materialized."
However, the number of transactions will be slightly lower than last year and activity will be modestly closer to the norm because the pull forward phenomenon last year was exacerbated by a tightening of mortgage qualification rules and the introduction of the HST in Ontario and British Columbia in the middle of the year.
Soper said the extension of low mortgage rates will be an unexpected boon to the market this year.
“Like many Canadians, we anticipated an end to the ultra-low interest rate era before year-end 2010," he said.
"Paradoxically, global economic weakness, particularly in the United States, allowed policy-makers and financial institutions to keep borrowing costs low, resulting in a stronger Canadian housing market and a better than forecast fourth quarter.”
Average house prices rose between 3.9 per cent and 4.6 per cent in the fourth quarter of 2010, while price appreciation is expected to continue a moderate and steady climb throughout the current year.
The report contrasts with some recent predictions by economists that prices should remain flat or decline over the next year.
The Canadian Real Estate Association has predicted prices will fall by 1.3 per cent to a national average of $326,000, this year, tied to weakness in British Columbia and Ontario — the hottest real estate markets of 2010. It has also forecasted a nine per cent decline in sales.
CREA has yet to release year-end data for 2010, but preliminary reports from two of the biggest markets, Toronto and Vancouver, released this week indicate 2010 declined as expected.
Sales were down by one per cent compared with 2009 in Toronto, while the average home selling price was $431,463, up nine per cent from 2009.
In Vancouver, sales declined 14.2 per cent from 2009, and were 10.3 per cent below the 10-year average for sales in the region. The average selling price in B.C.'s largest city was up 2.7 per cent at $577,808.
Canada's real estate market has been on a rebound over much of the past year after sales dried up in late 2008 and hit a multi-year low in January 2009.
The housing market's sudden plunge was sparked by a credit crunch that developed in the U.S. housing and lending industries, and gradually spread across the globe, causing a worldwide recession in the late summer and early fall of 2009.
The commercial real estate market experienced a similar plunge as investors lost confidence in the sector. However, the commercial market, which includes office and retail spaces, had a stronger than expected year in 2010 and that momentum is projected to strengthen throughout 2011, according to a report released Thursday by CB Richard Ellis Ltd. Some market observers had predicted a glut of vacancies in Canada's major business centres, but that didn't happen, said John O‘Bryan, vice-chairman of CB Richard Ellis Canada.
We‘ve had good news over the past twelve months with respect to interest rates, housing trends and employment gains, with many companies announcing plans for expansion, he wrote in the report.
"2011 may well be another good, stable year but should be viewed with cautious optimism in light of the concentration in employment growth on part-time jobs rather than the full-time positions that indicate confidence in long-term, sustainable growth."
http://ca.finance.yahoo.com/news/Housing-market-resilient-2011-capress-4179400062.html?x=0
SO BEST TO CONSIDER BUYING NOW OR SELLING NOW IN FIRST HALF OF 2011 BEFORE INTEREST RATES RISE! Cheers Roy
Wednesday, November 3, 2010
Monthly/Yearly Stats October 2010
Kitchener-Waterloo:
Residential sales DOWN 22.4% and up 1.9% for the year. That's 6 months in a row with declining sales and increasing inventory.
Days on market from 51 to 44 for the year.
Sales to active ratio 15.1% was 21.4% in 2009.
That means less 1 in 6 homes sold.
Sales$ to list$ ratio was 97.7% and 98.1% 2009.
Average sale price detached up 13.5% $346,389 for the year.
Average sale price semi-detached UP 11.2% to $238,739 for the year.
Average sale price for freehold townhomes up 15.8% to $256,815 for the year.
New listings up 9.2% for the month to 847 and number of listings for the year 9296 is up 7.6%.
Residential sales DOWN 22.4% and up 1.9% for the year. That's 6 months in a row with declining sales and increasing inventory.
Days on market from 51 to 44 for the year.
Sales to active ratio 15.1% was 21.4% in 2009.
That means less 1 in 6 homes sold.
Sales$ to list$ ratio was 97.7% and 98.1% 2009.
Average sale price detached up 13.5% $346,389 for the year.
Average sale price semi-detached UP 11.2% to $238,739 for the year.
Average sale price for freehold townhomes up 15.8% to $256,815 for the year.
New listings up 9.2% for the month to 847 and number of listings for the year 9296 is up 7.6%.
Friday, October 8, 2010
Canada Unexpectedly Loses Jobs
OTTAWA — The Canadian economy lost 6,600 jobs in September, Statistics Canada said Friday, as the country’s recovery faltered after an initially strong rebound from recession.
The jobless rate declined to eight per cent during the month, from 8.1% in August, “as fewer people, particularly youth, participated in the labour market,” the federal agency said.
Economists’ forecasts had ranged from 10,000 to 12,500 new jobs last month, following a gain of 35,800 in August, with the unemployment rate staying at 8.1%.
Canada’s gross domestic product declined in July for the first time in almost a year Statistics Canada said Thursday the economy shrank 0.1 per cent during the month.
The July data marked the first monthly contraction since August 2009, when GDP shrank 0.1%. That had been the only month to show a decline in economic activity since a 10-month string of reduced GDP readings between August 2008 and May 2009.
The Bank of Canada had anticipated 3.5% growth this year and 2.9% in 2011, although those projections are expected to be revised downward when the central bank releases its updated economic outlook on Oct. 20.
That slower growth has put into question any further interest rate hikes by the Bank of Canada.
The central bank has raised in recent months its trendsetting interest rate from a record low 0.25% to its current level of one per cent. The bank’s next policy meeting is Oct. 19.
The jobless rate declined to eight per cent during the month, from 8.1% in August, “as fewer people, particularly youth, participated in the labour market,” the federal agency said.
Economists’ forecasts had ranged from 10,000 to 12,500 new jobs last month, following a gain of 35,800 in August, with the unemployment rate staying at 8.1%.
Canada’s gross domestic product declined in July for the first time in almost a year Statistics Canada said Thursday the economy shrank 0.1 per cent during the month.
The July data marked the first monthly contraction since August 2009, when GDP shrank 0.1%. That had been the only month to show a decline in economic activity since a 10-month string of reduced GDP readings between August 2008 and May 2009.
The Bank of Canada had anticipated 3.5% growth this year and 2.9% in 2011, although those projections are expected to be revised downward when the central bank releases its updated economic outlook on Oct. 20.
That slower growth has put into question any further interest rate hikes by the Bank of Canada.
The central bank has raised in recent months its trendsetting interest rate from a record low 0.25% to its current level of one per cent. The bank’s next policy meeting is Oct. 19.
Wednesday, October 6, 2010
Sept. 2010 KW Real Estate Results
KITCHENER-WATERLOO, ON (Oct 5, 2010) -Home sales to the end of the third quarter of 2010 are ahead of last year by 4.5 percent. There were a total of 5,113 home sales through the Multiple Listing System (MLS®) of the Kitchener-Waterloo Real Estate Board (KWREB) during the first nine months of the year, compared with 4,892 during the same period of 2009.
"This is the first time since 2007 that sales to the end of the third quarter have increased on a year over year basis", says Ted Scharf, President of the KWREB. "It was also our third best September on record. "
Sales last month brought the dollar volume to $1,477,077,951, an increase of 14.1 percent compared to one year ago.
The most popular price range year-to-date has been for homes selling between $225,000 and $250,000, with nearly 15 percent of sales happening in that bracket. This is down slightly from 2009, when the percentage was 16 percent.
The number of residential sales increased in every price category above $250,000, with the biggest jump occurring in the most expensive homes. 62 homes sold to the end of September for more than $750,000, compared to only 24 last year at this time, a jump of 158 percent.
Stronger demand for high-end homes has contributed to the 10.2 percent increase in the average sale price of all detached homes sold year-to-date. The average price of a detached home to the end of the third quarter was $329,063, compared to $298,626 to the end of September 2009.
The average price of all residential properties sold year-to-date was $288,887, a 9.1 percent increase relative to 2009 results.
Scharf says the local residential real estate market should remain strong for the balance of the year. The local economy is both diverse and dynamic, and our region is highly regarded as a perfect place to make roots and invest in a home.
"This is the first time since 2007 that sales to the end of the third quarter have increased on a year over year basis", says Ted Scharf, President of the KWREB. "It was also our third best September on record. "
Sales last month brought the dollar volume to $1,477,077,951, an increase of 14.1 percent compared to one year ago.
The most popular price range year-to-date has been for homes selling between $225,000 and $250,000, with nearly 15 percent of sales happening in that bracket. This is down slightly from 2009, when the percentage was 16 percent.
The number of residential sales increased in every price category above $250,000, with the biggest jump occurring in the most expensive homes. 62 homes sold to the end of September for more than $750,000, compared to only 24 last year at this time, a jump of 158 percent.
Stronger demand for high-end homes has contributed to the 10.2 percent increase in the average sale price of all detached homes sold year-to-date. The average price of a detached home to the end of the third quarter was $329,063, compared to $298,626 to the end of September 2009.
The average price of all residential properties sold year-to-date was $288,887, a 9.1 percent increase relative to 2009 results.
Scharf says the local residential real estate market should remain strong for the balance of the year. The local economy is both diverse and dynamic, and our region is highly regarded as a perfect place to make roots and invest in a home.
Friday, September 24, 2010
Consumer gloom, heavy debt loads keeping economy on the slow track
By Julian Beltrame, The Canadian Press
OTTAWA - Canada's once reliable consumer is emerging as a weak link in the country's economic recovery and future growth prospects.
A survey of consumer confidence for September came in as expected Thursday, suggesting Canadians are losing faith in the recovery and putting purchasing decisions off for another day.
Research marketing firm TNS Canada said its consumer confidence index dropped 2.3 percentage points, tracking a similar downward trend found in other polls and coming on the heels of four straight monthly declines in retail sales.
The survey suggested that several factors are holding Canadians back from a more positive outlook, including lower confidence in household income and employment prospects over the next six months.
Fewer respondents said they thought the current period was a good time to make major purchases.
"After last month's mini-rally it seemed that consumers might be the sump pumps that could return some buoyancy to that recovery," said Michael Antecol, vice-president of the marketing research firm TNS Canada.
"Now, it seems as if those pumps are sputtering, leaving some rocky days ahead."
The likely explanation is that Canadian households — much like their U.S. counterparts — have simply run out of enough resources to continue powering the economy, analysts believe.
And Canadians are getting nervous about their job security, the biggest factor in the confidence index.
While the economy has recouped all the job losses from the recession, the unemployment rate remains about two points higher than pre-slump levels, and employment gains have slowed appreciably since the spring.
The Bank of Canada has been sending up red flags about the exposure of households to debt for the better part of the year, one reason it is the only central bank among the G7 countries to have begun raising interest rates.
The central bank is widely expected to pause for the next few months now that the recovery appears to be slowing much faster than anticipated.
By way of contrast, Canada's approach to monetary policy has been the exact opposite of the U.S., where the Federal Reserve said this week it will likely need to loosen the purse strings further through more quantitative easing.
Even if borrowing costs do rise, the issue for most indebted Canadians would not be insolvency, but the fact they will be forced to scale back on future purchases because a bigger slice of disposable income would be going to debt servicing.
Scotiabank economist Derek Holt noted that while Ottawa can rightly boast of its sound fiscal position, that does not extend to the private sector.
When private debt is combined with that held by government, Canada's total punches in at 239 per cent of gross domestic product, not far removed from such free-spenders as the United States, the United Kingdom and Spain, and above such troubled economies as Italy and Japan.
"One of the dominant reasons Canada outperformed its peer group from the G7 over the past decade had to do with domestic economy strength, and I think that story is coming to a close," Holt said.
"We've experienced a tremendous bull run in the consumer sector and housing markets, but there's a case for arguing Canadian households are debt weary."
The Bank of Canada has also built more parsimonious consumers and a softer housing market into its future growth scenarios.
Combined with a weak export sector that is hamstrung by flagging demand from its largest market, the United States, and a strong loonie, several forecasting houses have slashed growth projections for Canada to two per cent and under for the next 18 months.
The latest was the CIBC, which said Wednesday it now expects the economy to expand by only 1.9 per cent next year — 0.6 of a point less than its forecast just two months back and a full point below the Bank of Canada's forecast.
Growth in the two per cent range represents trend growth in normal times, but is unusually low for an economy just a few quarters out of a deep recession.
Holt said future pillars of Canadian growth will likely be commodity exports, particularly oil, and business investment. But for the first time since the last recession, the economy may have to plug along without much help from the consumer.
OTTAWA - Canada's once reliable consumer is emerging as a weak link in the country's economic recovery and future growth prospects.
A survey of consumer confidence for September came in as expected Thursday, suggesting Canadians are losing faith in the recovery and putting purchasing decisions off for another day.
Research marketing firm TNS Canada said its consumer confidence index dropped 2.3 percentage points, tracking a similar downward trend found in other polls and coming on the heels of four straight monthly declines in retail sales.
The survey suggested that several factors are holding Canadians back from a more positive outlook, including lower confidence in household income and employment prospects over the next six months.
Fewer respondents said they thought the current period was a good time to make major purchases.
"After last month's mini-rally it seemed that consumers might be the sump pumps that could return some buoyancy to that recovery," said Michael Antecol, vice-president of the marketing research firm TNS Canada.
"Now, it seems as if those pumps are sputtering, leaving some rocky days ahead."
The likely explanation is that Canadian households — much like their U.S. counterparts — have simply run out of enough resources to continue powering the economy, analysts believe.
And Canadians are getting nervous about their job security, the biggest factor in the confidence index.
While the economy has recouped all the job losses from the recession, the unemployment rate remains about two points higher than pre-slump levels, and employment gains have slowed appreciably since the spring.
The Bank of Canada has been sending up red flags about the exposure of households to debt for the better part of the year, one reason it is the only central bank among the G7 countries to have begun raising interest rates.
The central bank is widely expected to pause for the next few months now that the recovery appears to be slowing much faster than anticipated.
By way of contrast, Canada's approach to monetary policy has been the exact opposite of the U.S., where the Federal Reserve said this week it will likely need to loosen the purse strings further through more quantitative easing.
Even if borrowing costs do rise, the issue for most indebted Canadians would not be insolvency, but the fact they will be forced to scale back on future purchases because a bigger slice of disposable income would be going to debt servicing.
Scotiabank economist Derek Holt noted that while Ottawa can rightly boast of its sound fiscal position, that does not extend to the private sector.
When private debt is combined with that held by government, Canada's total punches in at 239 per cent of gross domestic product, not far removed from such free-spenders as the United States, the United Kingdom and Spain, and above such troubled economies as Italy and Japan.
"One of the dominant reasons Canada outperformed its peer group from the G7 over the past decade had to do with domestic economy strength, and I think that story is coming to a close," Holt said.
"We've experienced a tremendous bull run in the consumer sector and housing markets, but there's a case for arguing Canadian households are debt weary."
The Bank of Canada has also built more parsimonious consumers and a softer housing market into its future growth scenarios.
Combined with a weak export sector that is hamstrung by flagging demand from its largest market, the United States, and a strong loonie, several forecasting houses have slashed growth projections for Canada to two per cent and under for the next 18 months.
The latest was the CIBC, which said Wednesday it now expects the economy to expand by only 1.9 per cent next year — 0.6 of a point less than its forecast just two months back and a full point below the Bank of Canada's forecast.
Growth in the two per cent range represents trend growth in normal times, but is unusually low for an economy just a few quarters out of a deep recession.
Holt said future pillars of Canadian growth will likely be commodity exports, particularly oil, and business investment. But for the first time since the last recession, the economy may have to plug along without much help from the consumer.
Monday, September 20, 2010
Most Expensive Cities
Montreal, Toronto among top 10 most expensive cities- Vancouver, obviously was already in the list.
By The Canadian Press
TORONTO - Toronto and Montreal have now joined the list of the top 10 most expensive cities in the world due to a stronger loonie and higher inflation rate.
An updated survey from Swiss wealth management firm UBS Bank suggests the two Canadian cities jumped around 20 spots since last year, ranking eighth and ninth among 73 cities surveyed.
Oslo, Zurich and Geneva remain the world's most expensive cities, but Canada's two largest cities ranked higher than London, Singapore and even Paris.
On the other end, the lowest prices for a broad basket of goods and services can be found in Mumbai, Manila and Bucharest.
Despite the pricey standard of living, the survey also found employees in the Canadian cities enjoy relatively high purchasing power from their hourly wages with Montreal ranking 11th and Toronto 14th.
On top were workers in Zurich, Sydney and Miami, while employees in Jakarta, Nairobi and Manila had the lowest purchasing power among cities surveyed.
When it came to comparing wages, the survey found Toronto ranked 13th and Montreal 16th among cities surveyed. Zurich and Copenhagen had the two highest wage levels.
The Prices and Earnings survey is published every three years. In 2009, the survey measured a standardized basket of 122 goods and services between March and April. This year's update was carried out to adjust 2009 data for cumulative inflation and exchange rate movements.
The next full survey is scheduled for the spring of 2010.
By The Canadian Press
TORONTO - Toronto and Montreal have now joined the list of the top 10 most expensive cities in the world due to a stronger loonie and higher inflation rate.
An updated survey from Swiss wealth management firm UBS Bank suggests the two Canadian cities jumped around 20 spots since last year, ranking eighth and ninth among 73 cities surveyed.
Oslo, Zurich and Geneva remain the world's most expensive cities, but Canada's two largest cities ranked higher than London, Singapore and even Paris.
On the other end, the lowest prices for a broad basket of goods and services can be found in Mumbai, Manila and Bucharest.
Despite the pricey standard of living, the survey also found employees in the Canadian cities enjoy relatively high purchasing power from their hourly wages with Montreal ranking 11th and Toronto 14th.
On top were workers in Zurich, Sydney and Miami, while employees in Jakarta, Nairobi and Manila had the lowest purchasing power among cities surveyed.
When it came to comparing wages, the survey found Toronto ranked 13th and Montreal 16th among cities surveyed. Zurich and Copenhagen had the two highest wage levels.
The Prices and Earnings survey is published every three years. In 2009, the survey measured a standardized basket of 122 goods and services between March and April. This year's update was carried out to adjust 2009 data for cumulative inflation and exchange rate movements.
The next full survey is scheduled for the spring of 2010.
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