1 July is a day more commonly known as ‘Canada Day’ to approximately 30,000 Canadian citizens that call Australia home, particularly Blue Wealth’s Event Manager, Taryn. The date is significant as it is the date that their constitution was established. Canada and Australia have a lot in common economically; let’s explore this together.
1) Both Australia and Canada are in the higher echelons of the global rankings for Gross Domestic Product per capita (GDP per head). They both fit into the $51,200 to $102,400 category. Australia, however, is ranked higher in both the International Monetary Fund (IMF) index and the World Bank index.
2) Bothcountries are constitutional monarchies under the executive reign of the British crown. Their political systems are based on the British Westminster philosophy, and they have three powers of government including the legislative, the judicial and the executive. The doctrine of ‘separation of powers’ mitigates against political risk, making both countries more politically stable and therefore more desirable for investors. The flip-side of that coin? Australians and Canadians both endure the bureaucracy inherent within this democratic structure.
3) The IMF recently released its house-price-to-income ratio report. In this report, Australia and Canada sat side by side on the higher side of the graph. This was mitigated, however, in a recent Blue Wealth article titled ‘My Bubbles: What Bubbles?’
4) With direct reference to property, Canada has an alternative gauge of performance reporting. House prices in Canadian cities are gauged by the ‘average’ rather than the Australian method of ‘median’. Economics and statistics boffins would cringe at the use of the ‘average’ figure due to the fact that averages incorporate ‘outliers’, which can skew the data.
5) To pair cities with approximate respect to pricing we have: Sydney alongside Vancouver, Melbourne alongside Toronto, Brisbane alongside Calgary, and Adelaide alongside Ottawa.
What can we learn from Australia and Canada’s relationship? Intercity property prices are far more divided than those found in Australia, weather plays a far greater role in Canadian property performance, vacancy rates are far greater in Canada than those found in Australia yet price growth has been higher, and of course the final kicker from the fourth point above…
Statistics are plentiful and easily manipulated so it is important to seek the services of professionals that have your best interests at heart.