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(September 12, 2007) Owning a home isn’t getting any cheaper in most markets across Canada, according to a report from RBC Economics.

“In the second quarter, Canada’s housing affordability experienced one of the largest and most broadly based quarterly deteriorations since the mid-1990s,” said Derek Holt, assistant chief economist at RBC. “Higher house prices, mortgage rates, utilities and property taxes all combined to drive the countrywide deterioration.”

The erosion of affordability was greatest in the west, with Saskatchewan, Alberta and British Columbia seeing the greatest increases in ownership costs.

A standard two-storey house remains the least affordable option for Canadians, gobbling up, on average, 46% of owners’ pre-tax income. Detached bungalows are not much cheaper, costing 41% of income, while townhouses, on average, chew through 33% of owners’ income.

Condominiums remain the most affordable option, requiring only 29% of income. That lower cost of ownership could be behind the surge of boomers moving into the condo market.

According to a separate report from Genworth Financial, people over the age of 55 are driving the condo market in eight urban settings across the country. As their children move out, many boomers have opted to downsize their abodes. Genworth predicts that the demand for condos will continue to grow through 2011.

“The record number of baby boomers will help maintain demand for condos in markets across the country, keeping price growth steady,” said Peter Vukanovich, president of Genworth Financial Canada. “That will benefit first-time homebuyers, who otherwise might worry about their investment in a future condo downturn.”

The trend of an aging population is no secret, but it may come as a surprise that many are content to remain in the city, rather than retiring to cottage country. Boomers aged 55 to 64 now account for 30.1% of the population in the Greater Toronto Area, and 30% of Montreal’s population.

“We’re seeing a clear trend among downsizing baby boomers who are looking for convenience, security and the ability to enjoy their retirement living in a condo where they can walk to restaurants and shopping, transit, and enjoy a new lifestyle,” said Bob Finnigan, president of the Building Industry and Land Development Association.

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Richardson creates fixed income group

(September 12, 2007) Richardson Partners Financial Limited has launched its fixed income specialist group, which will be based in the firm’s Montreal office.

“The launch of this new service brings a new breadth of expertise to the firm, which is particularly relevant considering the recent volatility being experienced in the markets,” said Richardson’s president and CEO, Sue Dabarno.

The new group is made up of Johanne Berthiaume, Paul Gauthier and Alain Pelletier, who bring a combined 70 years’ experience in the institutional fixed income sector, specializing in government bonds and coupons, structured products and corporate bonds.

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Investors get access to ABCP data

(September 12, 2007) The investor committee overseeing the proposed restructuring process of Third Party asset-backed commercial paper has announced that a virtual data room has been developed by Ernst & Young.

This project will include all material information relating to the Third Party ABCP conduits that entered into the agreement. Investors may access the data as of September 12.

“The investor committee feels that opening the virtual data room is an important step in the process of restructuring the Third Party ABCP,” said Purdy Crawford, chair of the committee. “I encourage investors to take the opportunity to obtain the information made available in the virtual data room, and I further encourage them to support the investor committee in its efforts to restructure the Third Party ABCP for the benefit of all investors.”

In order to receive access to the virtual data room, each investor must provide satisfactory evidence to Ernst & Young of its ownership of affected Third Party ABCP and sign a specified confidentiality agreement. The virtual data room is accessible through the Ernst & Young website.

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CWT offers low-cost account for GrowthWorks investors

(September 12, 2007) GrowthWorks and Canadian Western Trust Company have entered into an agreement to offer a low-cost, high-service registered account to shareholders of GrowthWorks managed funds.

“We are thrilled to be working with GrowthWorks and providing our joint customers with enhanced products and services,” said Scott Scobie, managing director, sales and marketing, at CWT. “Our self-directed product allows for a full range of investments to be held in a single consolidated account. It is ideal for helping our independent financial advisor customers more efficiently manage their clients’ investment portfolios.”

(09/12/07)