(CREA) On September 3, the Bank of Canada announced that it was holding its trend-setting overnight lending rate at one per cent. The overnight rate has not moved in four years. It’s likely that it will remain where it is for some time yet. Why?

1 Inflation is on target – Inflation recently increased and is tracking close to the Bank’s two per cent target. However, the Bank believes the increase reflects temporary factors and cited evidence in support of this in its policy rate announcement. As a result, it does not see interest rate hikes as being necessary to rein it in. Instead, the Bank thinks inflation will keep itself in check as temporary factors dissipate.

2 Uncertainty remains high – While the U.S. economic recovery appears to be back on track after a dismal first quarter, European economic growth has faltered due in part to its trade sanctions with Russia. This means low interest rates are still needed to support Canadian economic growth while question marks loom about the outlook for global economic growth, demand for Canadian exports, and Canadian economic growth.

3 Canadian exports need help from the currency exchange rate – The Bank rate announcement noted that “Canadian exports surged in the second quarter.” The reasons cited were strengthening U.S. investment and “the past depreciation of the Canadian dollar.” Hiking interest rates too soon would result in a stronger loonie and dampened Canadian exports. The Bank is counting on stronger exports to lift business investment and economic growth.

4 Higher exports have not yet translated into stronger investment or hiring– The Bank was pleased to see the pickup in exports but noted, “While an increasing number of export sectors appear to be turning the corner toward recovery, this pickup will need to be sustained before it will translate into higher business investment and hiring.” As such, interest rates will need to remain stimulative in order to entice firms into increased investment and hiring even if exports remain strong.

With these reasons in mind, interest rates are unlikely to rise in the near future.

One notable change in language in the September 3 announcement was the removal of any references to a soft landing in the housing market. The Bank said that the housing market has in fact remained stronger than previously anticipated and that risks associated with household imbalances have “not diminished.”

That said, it is possible that stronger U.S. growth, a surge in exports, and the current strength of the housing market could all reflect a rebound from weak performances this past winter, which was unusually harsh.

As such, the Bank said that it remains “neutral with respect to the next change of its policy rate,” and will wait for new information as regards their outlook and assessment of risks to economic growth and inflation.

As of September 3, the advertised five year lending rate stood at 4.79 per cent, unchanged from the previous Bank rate announcement on July 16, and down 0.55 percentage points from the same time one year ago.

The next interest rate announcement will be on October 22 and will be accompanied by an update to the Monetary Policy Report which contains the Bank’s outlook for the economy and inflation, risks to its economic projections, and an update to its estimate for potential Canadian economic growth.

MICHAEL MUI (24HRS) Young development executives speaking at a development panel on Thursday say they’re tired of being labelled “bad guys” when they don’t receive any credit for the public works development pays for.

Joo Kim Tiah, the 34-year-old president and CEO of Holborn Group — which is spearheading the Trump Tower in Vancouver — said he almost wants to leave and open shop in another country because developers are rarely recognized locally for their good work.

“We as developers are painted as bad people, that we are making windfall profits all the time,” he said.

“We try our best to contribute back to the communities and neighbourhoods and shape our city, but we’re hated by everyone else.”

Wesgroup properties senior vice-president Beau Jarvis, 39, said there’s a lack of understanding of what developers do.

“Infrastructure, roads, sewers, pipes pump stations, you name it, overpasses, highway exits on ramps, it’s all done by the people in this room,” he said.

“Yet Joe taxpayer believes that’s their tax dollar at work.”

Daniel Boffo, 35-year-old principal of Boffo Properties, said many who show up at community planning meetings “tend to be entrenched in their ways” and unwilling to compromise.

Jarvis calls the naysayers the “vocal minority.”

“We have lawsuits filed by residents associations that are completely log-jamming legal services at the City of Vancouver,” he said.

“The people who show up are literally in walkers and canes. These people are civic-minded and they have the time, but they’re planning for 10-20-year plans that are ultimately going to impact my children.

“And I call this a paradox because I don’t have time to go and attend these planning sessions ... and the people who do have the time aren’t going to be around to see the plan implemented.”

VANCOUVER, B.C. – September 3, 2014 – The Metro Vancouver housing market experienced steady home sale, listing, and pricing trends for the month of August. The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in Greater Vancouver reached 2,771 on the Multiple Listing Service® (MLS®) in August 2014. This represents a 10.2 per cent increase compared to the 2,514 sales recorded in August 2013, and a 9.5 per cent decline compared to the 3,061 sales in July 2014.

“Activity this summer has been strong but not unusual for our region,” Ray Harris, REBGV president said. “The volume of home sales has been higher than we’ve seen in the last three years, yet below the record-breaking levels of the past decade.”

Last month’s sales were 4.3 per cent above the 10-year sales average for August of 2,658.  The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver* is currently $631,600. This represents a 5 per cent increase compared to August 2013.  “Broadly speaking, home prices in the region are continuing to experience modest, incremental gains,” Harris said.

New listings for detached, attached and apartment properties in Metro Vancouver totalled 3,940 in August. This represents a 5.9 per cent decline compared to the 4,186 new listings in August 2013 and a 20 per cent decline from the 4,925 new listings in July. Last month’s new listing total was 8.4 per cent below the region’s 10-year new listing average for the month.

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 14,768, a 7.9 per cent decline compared to August 2013 and a 5.4 per cent decrease compared to July 2014. Sales of detached properties in August 2014 reached 1,158, an increase of 10.1 per cent from the 1,052 detached sales recorded in August 2013, and an 85.6 per cent increase from the 624 units sold in August 2012. The benchmark price for detached properties increased
6.6 per cent from August 2013 to $984,300.

Sales of apartment properties reached 1,126 in August 2014, an increase of 10.6 per cent compared to the 1,018 sales in August 2013, and a 55.3 per cent increase compared to the 725 sales in August 2012. The benchmark price of an apartment property increased 3.6 per cent from August 2013 to $379,200.

Attached property sales in August 2014 totalled 487, a 9.7 per cent increase compared to the 444 sales in August 2013, and a 62.3 per cent increase over the 300 attached properties sold in August 2012. The benchmark price of an attached unit increased 3.9 per cent between August 2013 and 2014 to $474,900.