Toronto Ranks Among Cities that will ‘Dominate’ for world’s MegaRich

Last Updated on January 24, 2019

A new study suggest that Toronto ranks among cities of key importance to the world’s mega rich and will be among those that “dominate.” The study released today by Knight Frank, a global real estate consultancy whose annual Wealth Report is widely followed.

The study ranks Canada’s financial capital as No. 12 among the 40 “most important cities” for the wealthy this year.

The report says, “If we assess quality of life, a clutch of northern European, Canadian and Australian cities, led by the likes of Melbourne and Toronto, will dominate.”

High net worth individuals have been flocking to Canada, which is among the top countries where destination is concerned. Canada also ranks as No. 4 in the study’s “Big Spenders Index,” which looks at how the wealthy among us are likely to spend their money.

The report adds, “Positive gains are also anticipated for the Vancouver market, while Montreal is expected to maintain balance. Continued uncertainty in the Calgary economy is expected to temper sales throughout the spring, with the degree of long term impact to be determined. Toronto’s recent ranking as the best place to live in the Economist’s 2015 Safe Cities Index, along with a lower Canadian dollar, only strengthens its global appeal as a destination for foreign real estate investment.”

The Greater Toronto Area, which takes in several surrounding regions, will see “strong demand” for detached homes worth more than $1-million, in particular.

Shares of Canadian Natural Resources Ltd. rose this week after a pleasant surprise from an otherwise bleak oil patch. Pleasant for shareholders only since managers and directors are taking a pay cut. Canada’s second-biggest energy producer boosted its dividend and reported better-than-expected fourth-quarter results. However, it again trimmed its spending plans.

The company said annual average production rose to record levels towards the end of 2014.

Canadian Natural hiked its quarterly dividend to 23 cents a share as profit climbed to $1.2-billion, or $1.09 a share, diluted, from $413-million or 38 cents a year earlier.

ECB boosts outlook
Things are looking brighter this week for Europe with the European Central Bank having raised its forecasts for economic growth, though its new projections put the region dangerously close to a deflationary period.

The government held its benchmark rate steady and rolled out details of its bond-buying stimulus program, known as quantitative easing. the central bank of the euro zone raised its growth forecasts to 1.5 per cent this year and 1.9 per cent next year.

“The latest economic data and, particularly, survey evidence available up to February point to some further improvements in economic activity at the beginning of this year,” ECB chief Mario Draghi told reporters.

“Looking ahead, we expect the economic recovery to broaden and strengthen gradually.”

The Bank of England also held steady today.

China trims target
At this week’s annual meeting of Parliament in China, Premier Li Keqiang unveiled a slower 2015 growth target of about 7 per cent, down from last year’s 7.5 per cent, which it didn’t make. This is the slowest pace of economic growth in almost 25 years for China.

This comes amid action from the People’s Bank of China, which on the weekend cut interest rates.

According to economists at Bank of Nova Scotia, “His speech at the annual meeting of the legislature overnight reinforced other key 2015 Chinese themes that investors should be watching, including: (i) fiscal policy will remain proactive; (ii) monetary policy will continue to be prudent; (iii) the yuan exchange profile will be kept at a reasonable and balanced level; and (iv) the government will push ahead with the reform of state-owned enterprises and the liberalization of the banking system and financial markets.”

Job quality sinks
Job quality in Canada has sunk to its lowest level in more than two decades, a study released this week shows.

According to the report by Benjamin Tal, the bank’s deputy chief economist, an employment quality index, compiled by CIBC and which tracks part-time versus full-time work, paid versus self-employment and compensation trends, has fallen to its lowest level on record. The findings may confirm that Canada’s job market is not as robust as it once was.