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Priced out of Toronto’s housing market? Get ready for the commute

Briefing highlights

  • When home prices are high, commuting's a hassle
  • Osborne warns against Brexit
  • How Canada is leading the anti-austerity drive
  • Should your company pay you to sleep?

Will policy makers act?

BMO Nesbitt Burns is flagging a housing-related issue sure to ring true for so many Torontonians: Getting to work on time and back home at a decent hour.

This comes from a discussion with senior economist Robert Kavcic and last week’s numbers on how home prices in Toronto and Vancouver continue to surge higher.

In a research note, Mr. Kavcic wondered what policy makers in British Columbia and Ontario might be thinking amid their housing booms.

He wasn’t advocating they do anything, nor even suggesting they could move to cool things down.

But he did muse on what form any measures could take if the provinces opted to go that route.

“With supply in the two hot markets extremely tight, prices are likely to push even higher through the always-important spring selling season,” Mr. Kavcic said in a report.

“The question is, will policy makers in B.C. and Ontario do anything to quell the fires?”

The federal and B.C. governments have already taken some measures. But nothing has stopped the drive ever higher where Vancouver and Toronto, and nearby regions, are concerned.

Which gets you to the transit issues.

“If at the provincial level, it would have to be something the provinces have jurisdiction over, such as property or land transfer taxes, potentially targeted at foreign buyers or non-owner-occupied investment properties,” Mr. Kavcic said later.

“Also, and this is a longer-term issue that addresses the constraints on the supply side … quicker and more timely transit to the outer reaches of the GTA,” he added, referring to the Toronto area.

“There is better supply of single-family homes out in many of those areas, and still quite a bit of development land just inside the green belt. The problem is, anyone purchasing a home in some of those areas still has a pretty tough time getting into work on time in Toronto.”

The Toronto Region Board of Trade, by the way, has also flagged commute times, noting in a report that Toronto has long commute times compared to other big cities.

“Toronto’s performance is poor as it gets a ‘B’ grade ... on commute times and a ‘C’ grade on the low proportion of workers who walk, bicycle or use transit,” the group said in its 2015 scorecard.

Loonie slumps

The Canadian dollar took a mighty tumble today, sliding along with other commodity-linked currencies as oil prices fell, but rebounded by late morning.

Crude slumped, though gained back ground, after the failure of several oil-producing nations to strike a deal that would freeze output levels.

The looonie traded in a wide range, as low as about 77 cents U.S., and as high as 78.1 cents in a rebound to top the previous close.

Osborne warns

Britain’s finance minister is warning that a so-called Brexit would hit the U.K. hard.

George Osborne, the Chancellor of the Exchequer, is taking an aggressive stance in an analysis and speech today, according to reports, after penning a piece in The Times suggesting Britain’s economy would contract by more than 6 per cent if the U.K. quit the European Union.

Mr. Osborne warned that Britain and its families would be “permanently poorer.”

Chart of the day

Canada’s young Liberal government is leading the world’s advanced economies in an anti-austerity drive, with a budget deficit of about 1 per cent of gross domestic product this year.

“Relative to its GDP, Canada is loosening fiscal policy this year by more than any other major advanced economy,” Michael Pearce, global economist at Capital Economics in London, said in a report, though he added that even that might not be big enough to get the job done amid the commodity price slump.

Mr. Pearce’s report noted how many governments are loosening up for the first time since 2010, which will mean “a small boost” to economic growth this year.

Video: Should your company pay you to sleep

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