Lights out

The lights are going out in the towers full of unsold dog crate condos.

Heck, it’s a fade-to-regret for legions of sellers who now wish they’d dropped their ask and quelled their greed. The autumn real estate market has officially croaked. It will be interred beside the sad remains of the spring market. Alas, we hardly knew ye.

A nail in the coffin came at 5 pm Eastern yesterday when auto giant Stellantis told the union boys that monstrous assembly plant in Brampton was kaput. It’s been idle for a while, but lately the company was retooling to build the popular Jeep Compass.  Previous work (assembling EVs) was halted last winter because of Trump’s tariffs, and now all production is moving to Illinois. A thousand jobs are not coming back.

Worse. Trump’s trade guy said last week the White House will not be allowing any tariff-free vehicle production in Canada as part of a renegotiated CUSMA. Bad news for the GTA. Awful news for the 462,000 people engaged in the business – directly building cars and trucks or making the parts used. And rotten news for real estate.

In that one market – the southern Ontario metrolopolis – there are already 30,000 resale properties listed plus another 21,000 new and unsold units. Sales are stagnating. The unemployment rate is a withering 9% already (two points higher than the national average). And now it looks like the Bank of Canada is taking the punch bowl away.

No rate cut coming.

The current odds are dropping. Today – after the Stellantis bomb – there’s a 81% probability the central bank will stay on hold at the end of this month, keeping its policy rate at 2.5% and dashing hopes mortgage rates were about to descend into the 3% zone.

Another rate cut coming? Not any more.

Click to enlarge. Source: Bank of Canada Odds

And despite gloom in the car biz, the latest jobs numbers nationally have drained off any incentive the bankers had for dropping the price of money. Canada added 60,400 hires in September, above expectations and helping to improve what’s been a dismal picture for most of 2025.

“The strong report is certainly welcome after the big declines in the prior two months,” says BMO economists. “For the Bank of Canada, the soft labour market over the summer was one of the key drivers of the September rate cut. That factor is no longer front and centre, so unless CPI (on Oct 21) slows materially, the solid jobs figures leans toward a pause at the October meeting.”

Then there’s the deficit – that thing we’ve yammered about here for the last couple of days.

We might see red ink totalling $100 billion or so in the November 4th federal budget. That amount of borrowing puts upward pressure on bond yields (and mortgage rates) while adding a ton of fiscal stimulus (spending) which means we don’t need monetary stimulus (lower rates). More reason for Tiff Macklem and his pals to hit the pause button in a time of growing uncertainty.

And, yeah, don’t forget Trump (who can?). He’s back in tariff-them-all mode. Canada’s lumber industry was hit again this week, and the American threat of a new 100% levy on China in a couple of weeks is unwelcome news as Mark Carney tries to flatter the orange guy into submission.

The American president is flying high these days. The government shutdown in Washington makes him more of a dictator, allowing disassembly of the federal bureaucracy (deep state), while he’s feted as a deity in Israel for getting the hostages home and creating at least one or two days of peace. He’s blowing up boats and offing Venezuelans with impunity, trying to throw the Argentinian election and has ordered troops onto the streets of US cities, while ‘red’ states create more safe Republican seats so he can win the 2026 midterm elections. What could possibly go wrong? He’s king.

Well, all we can count on is change.

Nobody said you have to like it.

About the picture: “Aloha, this is Zoey!” writes Erin. “A 5 month-old-blue heeler who has her eyes on the prize. As always, those of us in the boonies of northern BC appreciate the blog and all the work that goes into it.”

To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.

Source: https://www.greaterfool.ca/2025/10/15/lights-out-2/