Dennis Manahan

Canada has experienced around 300 catastrophic weather events since 1983, with both the frequency and cost of these disasters rising significantly in recent years. Over 60% of total insured losses caused by weather disasters between 2008 and 2024 stemmed from damage to personal property. Average insured personal property losses have nearly doubled in the past five years compared to previous years, putting significant pressure on Canadas home insurance sector for both insurers and households faced with rising home insurance rates. The increase in home insurance costs was generally higher in areas that have experienced greater insured damages from weather disasters. As well, some highly-impacted areas also face rising deductibles or reduced coverage for certain perils like hail or floods. Fiscally-constrained governments are also rethinking the level of financial assistance provided through disaster recovery programs to support communities recovering from uninsurable losses as costs of weather disasters rise. Canada has had over 300 catastrophic weather events since 1983. These are currently defined as weather disasters that cause at least $30 million in insured losses, though lower thresholds were used prior to 2022. The average number of annual catastrophic events has increased over time as have insured losses associated with these events. Insured losses vary by province with Alberta accounting for the largest share of total insured losses between 1983 and 2024, followed by Ontario and Quebec. The three provinces are the only ones that have been hit by billion-dollar-plus catastrophic events so far, with Alberta alone having had five as of 2024. More than 60% of insured losses from 2008 to 2024 were due to damage to personal property. In addition, the costs have increased substantially in recent years with insured damages to personal property during 2020-2024 being almost twice their level in the previous decade. Moreover, the insurance industry in Canada incurred underwriting losses in the personal property line of business in 2023 and 2024 as insured damages and operational expenses exceeded revenue earned from premiums. These changes have contributed to rising home insurance premiums, especially in areas hardest hit by severe weather, with Alberta being the most notable example of the variation in insurance cost increases between more and less vulnerable areas. Additionally, high-risk areas face other adjustments to home insurance policies including higher deductibles for example, for hail coverage in areas that have experienced substantial damage from hailstorms. In worst case situations, insurance coverage is simply not available for certain perils such as overland flooding in areas of the country deemed most at risk of flooding. Meanwhile, as households that are most vulnerable to severe weather are feeling the squeeze from the private insurance market, government disaster recovery programs, which have historically acted as an insurer of last resort, are also beginning to restrict the level of support provided to impacted communities as these programs are also contending with rising costs of extreme weather. https://economics.td.com/ca-extreme-weather-and-insurance

After a decline in September, housing sales in October were back on their upward trend that started last April. This sales performance and a decline in new listings contributed to tighten the sales-to-new listings ratio in October. Also, during that month, the national MLS House Price Index posted its first monthly risealbeit modestsince November 2024. Unit sales rose nationally by 0.9% (sa figures) from September to October, partially offsetting the -1.6% decline from August to September. Sales are back on the upward trend they have been exhibiting since their most recent trough in March of this year when economic uncertainty was rising with trade tensions. From the same month in 2024, sales declined -4.3% (nsa) in October. National new listings posted a -1.4% (sa) monthly decline in October, the second in a row with a -0.8% decline in the previous month. Despite these monthly declines, new listings have been generally trending up in 2025, and in October were higher by 4.3% (nsa) than in the same month in 2024. With the monthly rise in national (unit) sales and the decline in new listings, the sales-to-new listings ratio tightened (rose) by 1.2 percentage point in October to 52.2% (sa), still in the lower half of the estimated balanced conditions range for this indicator. The other indicator of market tightness we trackmonths of inventorywas at 4.4 nationally in October (sa figures), mostly stable at that level since July of this year, and below its 5.2 long-term (pre-pandemic) average. As in previous months, this market-tightness indicator was below its long-term average in most provinces, except in British Columbia and Ontario at 0.9 months above this average for both. For the first time since November 2024, the national MLS House Price Index (MLS HPI) posted a monthly rise in October, but relatively modest at +0.2% (sa). This price index declined -3.0% (nsa) from the same month last year and, from sa figures, is now 26.7% above its December 2019 level but nearly 18% below its February 2022 historical peak. From September to October 2025, sales increased in 18 of the 30 reported local markets we monitor while the sales-to-new listings ratio tightened (increased) in 17 of these markets. But as for Canada, this latter indicator of market conditions cooled in 22 of these markets. https://www.scotiabank.com/ca/en/about/economics/economics-publications/post.other-publications.housing.housing-news-flash.november-17--2025.html

Canadian home resales increased by 0.9% from September to October, the sixth increase in the last seven months. Despite the recovery in previous months, sales were still 7.5% below their most recent peak in November 2024. On the supply side, new listings declined 1.4% from September to October, a second consecutive decline. Active listings increased by 0.9% in October, following a contraction in the prior month as cancelled listings have recently moderated. Market conditions remained unchanged during the month and continued to indicate a balanced market compared to the historical average. Still, this largely reflects soft conditions in Ontario and B.C., while markets in all other provinces continue to favour sellers. Housing starts fell 16.6% in October to a seven-month low of 232.8K (seasonally adjusted and annualized). The loss was concentrated in Ontario, where starts plunged 51.8% in the month, largely because of a 61.7% decline in Toronto. Vancouver also saw a decrease (-16.9% to 19.4K), while Calgary (+37.9% to 36.1K) and Montreal (+8.7% to a 16-month high of 33.6K) posted gains. The TeranetNational Bank Composite National House Price IndexTM rose 0.4% from September to October after seasonal adjustment, marking a third consecutive increase for this indicator. Eight of the 11 CMAs included in the index saw increases, led by Quebec City (+2.5%), Winnipeg (+1.7%), Ottawa-Gatineau (+1.4%) and Victoria (+0.6%). From October 2024 to October 2025, the composite index fell by 2.6%, on decreases in Toronto (-7.2%), Vancouver (-4.5%) and Hamilton (-4.0%). These declines were partially offset by gains in Quebec City (+15.7%), Winnipeg (+5.4%) and Edmonton (+5.3%) https://www.nbc.ca/content/dam/bnc/taux-analyses/analyse-eco/logement/economic-news-resale-market.pdf

Among the 61% who have adjusted their holiday shopping plans due to tariff concerns, one quarter (25%) started holiday shopping earlier this year to avoid potential price increases as a result of tariffs. 41% will cut back on spending this holiday season. Canadians plan on spending an average of $2,310 this holiday season. The latest BMO Real Financial Progress Index reveals 61% of Canadians are changing their holiday spending plans this year in anticipation of rising costs caused by tariffs. 37% are trying to buy gifts minimally affected by tariffs, including purchasing goods made in Canada. 25% started their holiday shopping earlier to avoid potential price increases. 15% are budgeting to spend more on gifts in anticipation of higher prices. In the wake of recent tariff increases, rising unemployment, and an upturn in inflation, its not surprising that Canadian consumers are feeling a sense of trepidation heading into the holiday season, said Sal Guatieri, Senior Economist, BMO. Though not elevated, annual CPI inflation has picked up to 2.4% in September after remaining below 2% in the previous five months, partly due to a 3.8% rise in food costs. By weakening the economy, the trade war has lifted the unemployment rate, undermining consumer confidence and income growth. https://newsroom.bmo.com/2025-11-14-BMO-Survey-Three-in-Five-Canadians-Adjust-Holiday-Spending-Plans-Amid-Tariff-Concerns

The number of home sales recorded over Canadian MLS Systems edged up 0.9% on a month-over-month basis in October 2025, marking six monthly gains in the last seven months. After a brief pause in September, home sales across Canada picked back up again in October, rejoining the trend in place since April, said Shaun Cathcart, CREAs Senior Economist. With interest rates now almost in stimulative territory, housing markets are expected to continue to become more active heading into 2026, although this is likely to be tempered by ongoing economic uncertainty. October Highlights: National home sales climbed 0.9% month-over-month. Actual (not seasonally adjusted) monthly activity came in 4.3% below October 2024. The number of newly listed properties declined 1.4% on a month-over-month basis. The MLS Home Price Index (HPI) edged up 0.2% month-over-month but was down 3% on a year-over-year basis. The actual (not seasonally adjusted) national average sale price was down 1.1% on a year-over-year basis. New supply declined 1.4% month-over-month in October. Combined with an increase in sales activity, the sales-to-new listings ratio tightened to 52.2% compared to 51% recorded in September. The long-term average for the national sales-to-new listings ratio is 54.9%, with readings roughly between 45% and 65% generally consistent with balanced housing market conditions. There were 189,000 properties listed for sale on all Canadian MLS Systems at the end of October 2025, up 7.2% from a year earlier but very close to the long-term average for that time of the year. https://www.crea.ca/media-hub/news/canadian-home-sales-mark-four-year-high-for-the-month-of-september-2/

As the federal government launches a new drive to address Canadas housing crisis with Build Canada Homes, a new report released today by the National Housing Council (NHC) offers a comprehensive framework to assess the effectiveness of federal housing policy. The report entitled Measuring What Matters: Proposing an Outcomes Framework for Federal Housing Policy, tackles a central question: how will Canadians know if housing policies are working? Analysing the current health of Canadas housing system, the report finds that: Affordability is declining: Home ownership is affordable in fewer than 20% of Canadian markets, and asking rents are unaffordable for most renters. Housing transitions are stalling: Canadians face increasing barriers to moving through the housing system, from renting an apartment, to moving into ownership and from a first-owned home to a family-sized unit. Equity gaps persist: Lower-income households, women, Indigenous people, racialized communities, and other equity-denied groups experience worse housing outcomes. Supply challenges are growing: Rising costs of materials, land, labour, and municipal fees, along with approval delays and labour shortages, are driving a cost-of-delivery crisis. Policy misalignment remains: Success is often measured by inputs and outputs - such as dollars spent and units built - rather than improvements in housing outcomes. Grounded in the National Housing Strategy Act and the principles of the right to adequate housing, the report states that outcomes for people are what matter most when assessing if housing policies are working. https://nhc-cnl.ca/news/post/is-canada-s-housing-policy-working-look-at-the-outcomes-for-people-says-new-report-from-the-national-housing-council-

Canada can look to international examples where consolidating and scaling the housing system have helped sustain housing supply and affordability. According to a 2016 McKinsey report, the construction industry remains one of the least digitized sectors. Out of 22 industries reviewed, construction ranked second to last just ahead ofhunting and agriculture. Nearly a decade later, little progress has been made in how we build homes. Canadas housing sector feels stuck in an everlasting hunting-gathering era, resisting modernization. A large part of the solution to digitize our housing industry lies in scaling up to generate sufficient financial, human and technological resources to innovate. Canada can learn from the Netherlands, which has achieved scale in the housing sector, including with not-for-profit affordable housing providers. In 2024, Canada had 40,349 businesses that employed workers in the residential construction industry. Of these, only 6 businesses had more than 500 employees. The majority (69.5%) were micro businesses with just 1 to 4 employees. The same trend applies to the real estate lease management industry. While specific data for residential leasing is not available through the Canadian Industry Statistics, broader data for the real estate leasing and management sector tell a clear story: Of the 30,099 businesses that employ workers, 81.4% had less than 5 employees. By comparison, 59.2% of businesses across the entire economy fall into the micro-business category. https://www.cmhc-schl.gc.ca/observer/2025/unlocking-housing-supply-why-scale-really-matters

Highlights Missing Middle is a broad term for gentle- to-medium-density housing types such as accessory suites, multiplexes, row homes, stacked townhouses and low-rise apartments. These housing types are often underrepresented in new supply. Missing Middle housing starts across Canadas 6 major cities (Vancouver, Edmonton, Calgary, Toronto, Ottawa and Montral) increased by an average of 5% per year between 2018 and 2023. This was followed by an exceptional 44% surge between 2023 and 2024. Edmonton and Calgary lead the way in Missing Middle housing starts, supported by a lower regulatory burden, abundant land availability and favourable policy environments. Meanwhile, Toronto and Vancouver lag where denser forms of housing have historically been more feasible. The prevalence, type and location of new Missing Middle housing construction projects vary widely across cities. Factors such as land costs, developer expertise and evolving local policies play a key role. This report shares insights into the creation of Missing Middle housing options since 2018 in Canadas 6 major cities: Vancouver, Edmonton, Calgary, Toronto, Ottawa and Montral. Missing Middle housing is important as it provides a layer of supply that can be delivered within existing neighbourhoods. It can often be faster to develop especially when rezoning isnt needed and requires less capital investment than larger projects. It broadens housing choices for families who cant afford single-detached homes and find high-rise apartments do not offer enough space for their needs. Stakeholders, particularly policymakers at the municipal government level, working to encourage this kind of development, can benefit from understanding its prevalence in their communities. They can also gain insights into what built form it takes, its location and the reasons behind regional differences. https://www.cmhc-schl.gc.ca/observer/2025/how-common-missing-middle-housing-development-canada

The Canadian economy is adjusting to steep US tariffs on several industries and coping with elevated uncertainty. Tariffs have led to a fall in the demand for Canadian goods, affecting the broader economy. The reconfiguration of global trade and domestic production is also leading to higher costs. Total inflation has been around 2%, while underlying inflation has continued to be about 2%. With US tariffs and limited Canadian counter-tariffs in place, the effects of the trade conflict on growth and inflation in Canada are becoming clearer. Exports to the United States have fallen, and business investment has declined. The structural shift in the Canada-US trade relationship has put the economy on a lower path. At the same time, the reconfiguration of global trade and the restructuring of the Canadian economy are adding costs and putting upward pressure on inflation. Considerable uncertainty remains around US tariffs and how changes to global trade relationships will affect economic growth and consumer prices in Canada. This uncertainty includes the review of the Canada-United States-Mexico Agreement. How other major structural changessuch as shifting demographics and the adoption of artificial intelligencewill affect the Canadian economy is also unclear. The effects of these developments on output and inflation will play out over many years. Monetary policy cannot offset the long-term implications of US tariffs or other sources of structural change. The primary focus of monetary policy is to maintain low and stable inflation. https://www.bankofcanada.ca/publications/mpr/mpr-2025-10-29/overview/

The Bank of Canada today reduced its target for the overnight rate by 25 basis points to 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%. With the effects of US trade actions on economic growth and inflation somewhat clearer, the Bank has returned to its usual practice of providing a projection for the global and Canadian economies in this Monetary Policy Report (MPR). Because US trade policy remains unpredictable and uncertainty is still higher than normal, this projection is subject to a wider-than-usual range of risks. While the global economy has been resilient to the historic rise in US tariffs, the impact is becoming more evident. Trade relationships are being reconfigured and ongoing trade tensions are dampening investment in many countries. In the MPR projection, the global economy slows from about 3% in 2025 to about 3% in 2026 and 2027. In the United States, economic activity has been strong, supported by the boom in AI investment. At the same time, employment growth has slowed and tariffs have started to push up consumer prices. Growth in the euro area is decelerating due to weaker exports and slowing domestic demand. In China, lower exports to the United States have been offset by higher exports to other countries, but business investment has weakened. Global financial conditions have eased further since July and oil prices have been fairly stable. The Canadian dollar has depreciated slightly against the US dollar. Canadas economy contracted by 1.6% in the second quarter, reflecting a drop in exports and weak business investment amid heightened uncertainty. Meanwhile, household spending grew at a healthy pace. US trade actions and related uncertainty are having severe effects on targeted sectors including autos, steel, aluminum, and lumber. As a result, GDP growth is expected to be weak in the second half of the year. Growth will get some support from rising consumer and government spending and residential investment, and then pick up gradually as exports and business investment begin to recover. https://www.bankofcanada.ca/2025/10/fad-press-release-2025-10-29/

The number of home sales recorded over Canadian MLS Systems declined by 1.7% on a month-over-month basis in September 2025, ending a string of gains that began in April. That said, it was still the best month of September for sales since 2021. The small monthly decline was the result of lower sales activity in Greater Vancouver, Calgary, Edmonton, Ottawa, and Montreal, which more than offset gains in the Greater Toronto Area and Winnipeg. While the trend of rising sales that began earlier this year took a breather in September, activity was still running at the highest level for that month since 2021, and that was true in July and August as well, said Shaun Cathcart, CREAs Senior Economist. With three years of pent-up demand still out there and more normal interest rates finally here, the forecast continues to be for further upward momentum in home sales over the final quarter of the year and into 2026. September Highlights: National home sales declined 1.7% month-over-month. Actual (not seasonally adjusted) monthly activity came in 5.2% above September 2024. The number of newly listed properties edged down 0.8% on a month-over-month basis. The MLS Home Price Index (HPI) was little changed (-0.1%) month-over-month and was down 3.4% on a year-over-year basis. The actual (not seasonally adjusted) national average sale price ticked up 0.7% on a year-over-year basis. https://www.crea.ca/media-hub/news/canadian-home-sales-mark-four-year-high-for-the-month-of-september/

Home sales decreased by 1.7% from August to September at the national level, the first contraction following five consecutive monthly increases. On the supply side, new listings edged down 0.8% from August to September, the first decline in three months. Active listings decreased by 1.7% in September, the third contraction in four months as cancelled listings continue to be elevated. Market conditions remained unchanged during the month and continue to indicate a balanced market compared to the historical average. Still, the balanced market conditions at the national level largely reflect soft conditions in Ontario and B.C., while markets in all other provinces continue to favour sellers. Housing starts rose by 34.7K from 244.5K in August to 279.2K in September (seasonally adjusted and annualized). This increase offsets some of the 48.6K decline seen in August and brings starts above consensus expectation of 257.5K. Starts rose in urban areas (+34.9K to 254.3K), while they remained essentially unchanged in rural areas (-0.2K to 24.9K). In urban centres, the gain stemmed mainly from the multi-unit segment (+34.0K to 213.3K), while the increase in the single-detached segment was more muted (+0.9K to 41.0K). The TeranetNational Bank Composite National House Price Index rose by 0.2% from August to September after seasonal adjustment. Six of the 11 CMAs included in the index saw increases: Montreal (+2.4%), Quebec City (1.3%), Hamilton (+1.3%), Halifax (+1.1%), Vancouver (+0.1%) and Ottawa-Gatineau (+0.1%). Conversely, prices declined in Winnipeg (-1.2%), Calgary (-0.8%), Toronto (-0.3%) and Edmonton (-0.1%), while they remained stable in Victoria. https://www.nbc.ca/content/dam/bnc/taux-analyses/analyse-eco/logement/economic-news-resale-market.pdf

By TD Economics 2025 is shaping up to be a modestly better year than expected in our prior forecast. However, our provincial growth rankings are largely unchanged. Observed weakness in large manufacturing bases in Central Canada is as expected, while idiosyncratic factors are driving firmer performances elsewhere. Exports coast-to-coast dipped in the second quarter following a front-running of export activity to the U.S. the quarter prior. The outlook for Canadian trade has marginally improved as effective tariff rates have come in lower than our expectations. Across provinces, nominal exports to the U.S. from Quebec, Saskatchewan and Alberta have underperformed the nation as a whole. Evidence of an export rotation to non-U.S. markets is limited, with Ontario, Alberta, Newfoundland and PEI showing some promise. All provinces have taken steps towards the removal of interprovincial trade barriers. Ontario has arguably gone the furthest, followed by Nova Scotia, Manitoba, B.C. and PEI. Newfoundland and Labrador and New Brunswick have been more cautious. These encouraging developments could help offset some of the disruption caused by the Canada U.S.-trade war, but the scale of the boost could be limited. Notably, geographic barriers still exist, and not all provinces have trade agreements in place. Were retaining our view that Canadian housing will continue its recovery, fueled by pent-up demand in B.C. and Ontario, although loose conditions will restrain the extent of price gains in these two markets. Activity remains considerably firmer outside of these two markets, with mid-to-high single-digit price growth performances on tap in the Atlantic, most of the Prairies and Quebec this year and next. Canadas job market has recently shed over 100k jobs, driving the national unemployment rate to a cyclical high. Ontario has disproportionately absorbed the shock so far this year as its unemployment rate has risen faster than in other regions. We expect unemployment rates to drift lower as employment mildly improves and labour force growth stalls on the back of a standstill in population growth. Commodity producing provinces are still better positioned to weather trade-related headwinds. Production of key commodities in Alberta, BC, and Saskatchewan continues to trend higher as market demand has yet to wane. Some prices, particularly crude oil, have softened relative to our last forecast, but a broad-based mild recovery in commodity prices is expected through next year. https://economics.td.com/provincial-economic-forecast