The Canadian residential real estate development industry is experiencing its worst downturn since the 1990s recession, leading to significant job cuts across the sector. Developers like Mattamy Homes, Great Gulf, Polygon Realty Ltd., and Wesgroup Properties, along with related businesses, have laid off staff as projects are put on hold or cancelled due to high construction costs, borrowing costs, reduced demand (due to foreign student caps), and lack of investor interest. Over 100,000 jobs in the homebuilding industry are at risk.
Residential real estate developers cut jobs as downturn deepens
Business
AI Summary
TL;DR: Key points with love ❤️The Canadian residential real estate development industry is experiencing its worst downturn since the 1990s recession, leading to significant job cuts across the sector. Developers like Mattamy Homes, Great Gulf, Polygon Realty Ltd., and Wesgroup Properties, along with related businesses, have laid off staff as projects are put on hold or cancelled due to high construction costs, borrowing costs, reduced demand (due to foreign student caps), and lack of investor interest. Over 100,000 jobs in the homebuilding industry are at risk.
Trending- 1 Early 2000s: Norm Li started his business
- 2 1995: Preconstruction condo sales in Toronto were lower than Q1 this year
- 3 2020-2024: Annual average for preconstruction condo sales
- 4 This year: Wesgroup cut 12% of workforce
- 5 This week: Polygon Realty cut 5% of workforce
- 6 March: MLA Realty laid people off
- 7 Late May: LA Inc. shut down
- 8 End of last year: SvN scaled back workforce from 180 to 165 positions
- Significant job losses across the real estate development sector
- Threat to a significant part of the Canadian economy
- Hampering of future supply of new homes, impacting housing affordability goals
- Pipeline of talent in construction workforce at risk
What: Residential real estate developers and related businesses in Canada are cutting jobs due to a deepening downturn in the sector, described as the worst since the 1990s recession.
When: Downturn entering its fourth year; recent job cuts (e.g., this year, this week, late May).
Where: Canada, with specific mentions of Toronto, Kitchener-Waterloo, Hamilton, Ottawa, Montreal, Edmonton, Vancouver, and Calgary.
Why: High construction expenses and municipal development charges, relatively expensive borrowing costs, reduced housing demand due to federal government's cap on foreign students and newcomers, and lack of investor interest as condo values are not increasing and rent cannot cover mortgage/condo fees.
How: Companies are laying off staff, not replacing departing employees, and delaying or cancelling projects.