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British Columbia housing market off critical care list: BMO Add to ...

These are stories Report on Business is following Wednesday, Oct. 30, 2013.

Follow Michael Babad and The Globe's Business Briefing on Twitter.

B.C. housing in 'soft landing'
Bank of Montreal economists have taken British Columbia’s housing market off the critical care list.

“Since bottoming in February, sales in the province have jumped nearly 40 per cent through September, and were more than 50 per cent above year-ago levels in Vancouver,” senior economist Robert Kavcic of BMO Nesbitt Burns said today.

“That, plus a falloff in new listings, has all but quashed concerns of a hard landing,” he said in a report on the economic fortunes of the provinces.

“Note that after a buyer’s market plagued the past two years, the sales-to-new-listings ratio now paints a decidedly balanced picture of the B.C. market.”

As The Globe and Mail’s Tara Perkins has reported, Canada’s housing market has rebounded from the slump of a year ago, when new mortgage restrictions from the federal government were brought in to prevent a bubble.

And as Brent Jang writes, the rally in the B.C. market is projected to continue through next year.

“British Columbia’s housing market has been in sharp focus recently, as stricter mortgage rules implemented in July 2012 and lofty valuations (particularly in Vancouver) sent sales sliding early in the year,” said Mr. Kavcic.

“Fortunately, the market appears to have carved out a soft landing, with sales volumes across the province rebounding more than 30 per cent from their February low to near the 10-year average.”

Over all, Mr. Kavcic projects that Alberta and Saskatchewan will lead Canada in economic growth this year, which should continue in 2014.

“Ontario and Quebec, however, desperately need to see stronger growth south of the border, while Atlantic Canada continues to struggle with a stimulus hangover.”

Facebook surges
Facebook Inc. shares surged in after hours action today after the social network posted third-quarter results showing strong mobile advertising.

The stock was up by 8 per cent at about 5:30 p.m. ET.

Here are the highlights:

  • Profit came in at $425-million (U.S.) or 17 cents a share, compared to a loss of $59-million or 2 cents a  year earlier.
  • Revenue surged to $2-billion from $1.3-billion.
  • Mobile ad revenue now accounts for 49 per cent of the total.
  • Daily active users rose 25 per cent from a year earlier to an average 728 million in September.
  • Monthly active users rose by 18 per cent to 1.19 billion.
  • Mobile active users surged 45 per cent to 874 million.

"The strong results we achieved this quarter show that we're prepared for the next phase of our company, as we work to bring the next five billion people online and into the knowledge economy,” said chief executive officer Mark Zuckerberg.

Fed holds the line
The Federal Reserve held firm on existing policy today, giving no clues as to where it’s headed while citing still moderate economic growth.

Markets, of course, have been looking for signals on when the U.S. central bank might begin to ease its monthly asset purchases that are now running at $85-billion (U.S.) a month.

The Fed had been expected to announce just such a move at its September meeting, but surprised markets by holding steady.

Today, the Federal Open Market Committee, the policy-setting panel of the central bank, said it wants to see what comes next. It said the same thing last month, The Globe and Mail's Kevin Carmichael reports.

“The committee decided to await more evidence that progress will be sustained before adjusting the pace of its purchases,” the policy makers said.

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