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Economist says Bank of Canada and investors shorting Canadian housing should look closer at numbers

It was just four Toronto condominium developers and questionable statistical reporting that led to news earlier this year about a glut of high-rise units in Canada’s largest market, says a new report.

Canadian Imperial Bank of Commerce deputy chief economist Benjamin Tal says in a report out Monday that even the Bank of Canada has been fooled by the raw numbers about unabsorbed or unsold units that once broken down appear to be a bit deceiving.

“The big question is to what extent the condo markets in (Vancouver and Toronto) are overshooting. The answer, of course, is multi-dimensional, but a good starting point is to assess the trajectory of recently completed and unabsorbed units,” said Tal, in his report. “An increase here suggests that developers are finding it increasingly hard to sell completed units — usually a first sign of troubles ahead.”

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