More than four of 10 British Columbians say they are in the worse financial shape this year than at the same time last year, according to a new poll.
But the Canadian Pulse Report from Dye & Durham also finds growing confidence in the real estate market – albeit from a low level.
According to the poll, three out of four say they are spending more on groceries and 66 per cent more on gas at the expense of personal and retirement savings.
These figures reflect a pessimistic outlook among British Columbia about the state of the provincial economy. More than half of British Columbians (57 per cent) believe Canada will enter a recession in the next 12 months and 33 per cent believe the province has already entered one.
Economists traditionally define a recession as two quarters of negative growth. TD Economics forecasts that B.C.’s real GDP in 2023 will remain in the positive range with 1.2 per cent before slowing down to 0.5 per cent in 2024 before picking up again in 2025 with 1.7 per cent.
Overall, TD Economics predicts that B.C.’s economy will endure what it calls a “more pronounced downswing in 2024” with rising unemployment expected to peak at 6.4 per cent next year.
Reasons cited include the “double-whammy of both a slowing U.S. economy and the ongoing struggles in China,” a key market for provincial exports. Some 15 per cent of exports go to China – well above the overall Canadian share of less than five per cent.
But if the Dye & Durham poll matches recent figures painting a stagnating, even declining economic picture, it also shows some British Columbians bullish about the real estate market.
While high interest rates continue to discourage many British Columbians from entering the real estate market, 12 per cent say they expect to sell their primary residence and purchase a new one in the next 12 months, up from three per cent last year, “a positive sign for the real estate market,” according to the poll.
Figures from TD Economics paint a comparable picture. It expects home prices in B.C. to rise by 1.2 per cent in 2024 and 2.5 per cent in 2025. But these figures also come with the prediction that new housing starts in B.C. will drop. Whereas TD Economics forecasts 47,900 housing starts for 2023, the figures drop to 39,200 in 2024 and 38,500 in 2025.
The national picture described in the poll largely matches the provincial view. Almost 40 per cent of Canadians say they feel worse off financially compared to last year and 54 per cent believe Canada will enter a recession in the next 12 months with 32 per cent saying that Canada has already entered one.
“It’s clear that many Canadians have been feeling pinched by this high interest rate environment and have seen their purchasing power throttled over the past year,” said Martha Vallance, Chief Operating Officer for Dye & Durham.
Dye & Durham provides software and data to the real estate industry. The survey took place Aug. 16-18 and sampled a nationally representative sample of 1,001 Canadians who are members of the online Angus Reid Forum, balanced and weighted on age, gender, region and education. The poll has estimated margin of error of plus, minus 2.5 cent 19 out of 20 times.