It’s the most wonderful time of the year – especially if you’re in real estate. Statistics Canada (Stat Can) released gross domestic product numbers for Q3 2019. The numbers show healthy growth for the economy – until you dive into them. A single-industry represented more than half of quarterly growth – real estate transactions.

About Today’s Numbers

We’re looking at constant-price gross domestic product (GDP) and real estate’s contribution. Constant-price GDP removes the impact of inflation, and allows us to compare numbers more accurately. Stat Can uses 2012 dollars as the year they adjust to, so that’s what we’re using today. For real estate, we’re only looking at the biggest and most direct GDP contribution – real estate, rental and leasing (RERL). RERL is the contribution to GDP made during managing, selling, renting and/or buying real estate. To simplify it, it’s the commissions made from managing real estate transactions.

GDP For All Industries Grew 1.44%

Canada’s GDP is showing healthy superficial growth for all industries. All industries came in at $1.99 trillion seasonally adjusted at the annual rate in Q3 2019, up $4.47 billion or 0.22% from Q2. This represents an increase of $28.17 billion or 1.44% from the same quarter last year. Note the percentage changes, we’re going to circle back to those.

Canadian Gross Domestic Product (All Industries)

Gross Domestic Product (GDP) numbers for all industries in Canada, expressed in 2012 constant dollars.

Source: Statistics Canada, Better Dwelling.

GDP For Real Estate Transactions Grew 2.70%

Real estate transaction revenues is growing much faster than other industries. RERL represented $252.28 billion in Q3 2019, up $2.30 billion or 0.92% from the quarter before. This works out to $6.62 billion or 2.70% higher than the same quarter last year. Quarterly growth is 4x higher than all industries, and annual growth is over 80% higher. As you can probably guess here, it’s a really big percent of total growth. Like, an unreal amount of the growth.

Canadian Gross Domestic Product (All Industries)

Gross Domestic Product (GDP) numbers for real estate and rental and leasing in Canada, expressed in 2012 constant dollars.

Source: Statistics Canada, Better Dwelling.

Real estate transaction revenues are punching way above their weight. Transaction revenue growth is equivalent to 51.53% total industry quarterly growth. Growth for RERL over the past year, is the equivalent of 23.51% of all industry growth. Not only do real estate transactions represent a huge amount of growth in Canada, it’s been getting larger recently.

The real estate market may have cooled down a little, but the Canadian economy is still leaning on it. The business of moving people around is technically a small portion of total GDP. However, it represents a significant amount of total growth. That’s before you add in related industries, like construction and financing.

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