Record low interest rates for mortgages are keeping Toronto's real estate market at record highs. Torontonians are buying houses for incredible prices (often in bidding wars) despite the fact that we still have a pandemic going on.
Honestly I wonder if we had a war - possibly even a major war - if we might still be seeing this trend so long as the interest rates are super low and people feel safer in "a new house in the suburbs".
Meanwhile the CERB, CESB and various other measures like a moratorium on evictions have kept the Canadian economy alive, but in the next few months CERB and CESB are being phased out and evictions will resume. Those measures kept the Canadian economy going and Canadians spending money.
It could be that we shall see the true effects on the economy during the next 9 months if we see more companies declaring bankruptcy. There has already been dozens of large scale bankruptcies during the past 5 months of the pandemic, effecting tens of thousands of employees.
Similarly low oil prices means that various parts of Canada have shut down oil production, and yet gasoline prices remain high - proof that gas companies are continuing to unfairly gouge Canadians.
Thus I cannot help but feel that even though Canadian home buyers are benefiting currently from record low interest rates that we are standing on a precipice of what could be the biggest recession or depression in decades. I don't think the current situation is sustainable. Housing prices will have to crash eventually when a recession finally hits, and hits hard.
Canada managed to avoid the housing bubble bursting in 2008. Instead prices have continued to balloon, largely due to low interest rates.
But even record low interest rates must have a limit for how much they can stave off a recession or depression.