There has been an increase in housing investment and household disposable income according to the latest GDP figures.
Statistics Canada says that investment in residential construction was up 3.2% in the fourth quarter of 2017, following a flat third quarter.
Ownership transfer costs rose 9.3%, indicating increased resale activity, new housing construction was up 3%, while renovations edged down 0.1%.
Outlays on non-residential structures increased 1.3%, driven by a 2.1% rise in investment in engineering structures; while investment in non-residential buildings declined 0.8%.
Overall, the Canadian economy grew 0.4% in Q4, 2017 (in real GDP terms), the same as the previous quarter. Annualized, real GDP grew 1.7%. Full-year real GDP was up 3% in 2017 compared to 1.4% in 2016.
Household spending was up 0.5%, decelerating from Q3’s 0.9% with financial and insurance services seeing one of the largest gains (1.5%).
Disposable income was up 1.3%, mainly due to wage increases (1.5%) with services leading the gains.
Canadians were saving more as income rises outpaced spending gains. The savings rate was up to 4.2% from 4% in the previous quarter.
However, the rising cost of interest payments (3%), mainly due to mortgage costs, meant the debt service ratio increased to 13.83%.