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Canadian housing markets should cool down some this year and next with softer sales, construction and price growth from coast to coast.

But an expected cut in interest rates by the Bank of Canada will likely soften the blow, says a forecast from TD Economics.

"Canada’s real estate markets have been a pillar of strength this decade," TD deputy chief economist Craig Alexander said in his report, released yesterday. "But the recent U.S. housing correction certainly highlights the risk that booms can rapidly turn into busts."

Over the past five years, Canadian real estate, driven by demand in the western provinces, has seen an average 10 per cent gain annually.

But the latest data show the market has already started to cool, with growth having peaked in some cities, including Calgary and Edmonton, where prices have fallen.

"A weakening in affordability is a strong signal that it is only a matter of time before sales moderate and market conditions become more balanced," Alexander said.

Meanwhile, Canada is in the midst of an economic slowdown, with growth expected to slow to a mere 1.1 per cent in 2008.

Weaker labour markets, prompted by a slowdown in manufacturing in Ontario and some other provinces hit hard by a low U.S. demand and the strong Canadian dollar are expected to affect the economy.

"It is only a matter of time before the weak export performance tempers domestic economic conditions," Alexander said.

In Toronto, home sales have fallen for three straight months since the beginning of the year. The low figures could be distorted due to poor weather conditions and the introduction of a land transfer tax, the report said.

"As a result, a rebound in the spring may be in the cards, but then a renewed moderation should unfold."

The bank report is still forecasting house prices in Ontario to increase moderately by 4.4 per cent in 2008 and 4.1 per cent in 2009.

However, the housing market gets a reprieve because a weaker economy means the Bank of Canada will be prompted to lower its benchmark overnight interest rate.

Alexander said this is one of the reasons he doesn’t see a major housing correction in the forecast no fax payday loans.

Short-term rates are forecast to be lower by one and a half percentage points by the end of the year. Five-year fixed rates are not expected to come down significantly because of continuing problems in the credit markets.

The Bank of Canada is forecast to gradually tighten rates by late 2009 and leading into 2010.

But rising rates, Alexander warns, could "create significant challenges for urban centres where affordability is stretched for cities where speculation has remained strong."

Real estate conditions would have likely cooled sooner if not for new financing products such as extended 40-year mortgages, which has delayed the impact, the bank’s report says. The mortgages, preferred by some first-time buyers, have been criticized for adding massive debt to consumers who may never pay off their homes.

One concern remaining is over condominium building – Toronto is North America’s largest site for this type of product. But TD said it’s impossible to figure out how many speculators are in the market to make an accurate forecast.

"The main concern on the condo front is the extent to which purchases are being made for speculative purposes which would make them more vulnerable to price swings," Alexander said.

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Bell Canada, which operates the Bell ExpressVu satellite service, says it is exploring a proposal to give Canadians "free" access to a limited number of high-definition channels.

Dubbed "FreeSat," Bell said yesterday the offer would be ideal for consumers who are eager to access local HD stations but wary of paying subscription fees to television service providers.

"Bell ExpressVu believes that we can provide a service whereby we carry a certain number of high-definition signals from each of the major national and regional networks on our satellites," Gary Smith, president of Bell Video Group, told the federal broadcast regulator yesterday. "All they (consumers) would need would be the reception equipment."

The front-end cost of that receiver was not specified. Bell executives, however, made it clear that "free" access would be restricted to local over-the-air signals and would not include specialty or "pay-TV" networks.

Smith said FreeSat would also be a boon to conventional broadcasters because it would allow them to avoid "huge investments" in new transmission towers and distribution systems to carry those high-definition signals across the country.

The Canadian Radio-television and Telecommunications Commission has set 2011 as the deadline for television channels to be broadcast in high-definition digital, and networks around the country are scrambling to meet that deadline.

Broadcasters have expressed some initial interest in ExpressVu’s FreeSat, but formal agreements have yet to be hammered out, Smith said.

Bell Canada owns a minority stake in conventional broadcaster CTVglobemedia, but that network’s response to the proposal was less than enthusiastic.

"This is maybe the first time we are hearing any detail of this proposal," said Paul Sparkes, executive vice-president of corporate affairs with CTVglobemedia. "It is not really `free.’ It is fee-for-carriage for them. It is another free ride."

Alan Sawyer, a media strategist with Two Solitudes Consulting, said it is not clear whether ExpressVu plans to charge broadcasters a fee to carry their signals or whether the satellite company is eyeing a slice of potential advertising revenues.

But getting consumers hooked on satellite is probably the main motivation, he said, noting that receiver boxes provide an opportunity to "up-sell" customers to full satellite service.

"They are not doing it to be altruistic," Sawyer said.

Bell ExpressVu is championing FreeSat while battling another controversial proposal by broadcasters that would force satellite companies to carry all available local conventional channels. That rule is already in place for cable companies.

Mirko Bibic, Bell Canada’s chief of regulatory affairs, said satellite companies simply cannot "operate as cable in the sky" because, unlike cable, their market is national.

"The extra channels would consume 15 to 20 per cent of our capacity for standard-definition services," Bibic said cheap payday loans.

"If forced to do this, we would have to drop 50 to 60 services, including many Canadian discretionary services, to make the space available. This would cause significant damage to our business."

Bell also urged the broadcast watchdog to avoid a "one-size-fits-all" solution when overhauling regulations for television service providers. The request exposed a deepening rift between satellite and cable companies on the contentious issue of "distant signals."

Cable and satellite rivals have until recently presented a united front against broadcasters on other thorny issues, such as fee-for-carriage. Yesterday, however, the rivals signalled the fleeting nature of their alliance by telling the regulator they remain at odds over "distant signals," also known as "time shifting."

Bell took direct issue with Rogers Communications Inc.’s claim that satellite companies "get a break" on the money they pay broadcasters to carry distant signals.

Rogers told the regulator on Tuesday that cable companies currently pay broadcasters 50 cents per subscriber to carry those domestic signals. Satellite companies, however, are allowed to do the same "free." The cable giant is demanding a "symmetrical" payment system, which would require satellite providers to pay the same rate as cable.

"Contrary to Rogers’ statement yesterday, we pay the equivalent of 43 cents per subscriber for distant signals," Smith said.

He said that price reflects the "total cost" to ExpressVu to provide the service, which enables customers to watch network stations from across the country.

Broadcasters are currently lobbying to hike the fees, suggesting time shifting "severely undermines" the revenue potential from local advertisers.

The regulator is being asked to provide a "commission-mandated" settlement on the issue.

"Our solution to distant signals is different than Rogers’," Smith said. "That means the most appropriate way to resolve that issue is not through policy regulation but through negotiation."

He also took a jab at broadcasters, suggesting their claims of "financial damage" caused by the carriage of distant signals have been "consistently exaggerated."

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VANCOUVER – Canfor Corp. is cutting production by about 15 per cent by dropping shifts and reducing work weeks at a number of its mills, citing the continued "raging storm" in lumber markets that shows no sign of calming any time soon.

The Vancouver-based forestry company (TSX: CFP) said today about 97 jobs will be cut as it moves to two shifts from three at its Prince George sawmill, and to one shift from two at its Clear Lake finger joint operation.

The money-losing company is also reducing work weeks at eight mills to four days from five.

The decision will reduce its annual lumber production by 600 million board feet, or about 15 per cent from its 4.1 billion board feet of production in 2007.

Canfor president and CEO James Shepard said in an interview that the cuts were necessary due to the continued falling demand and poor pricing for softwood lumber.

"We are basically sailing this ship through a raging storm and we are making the course corrections as we see absolutely necessary, and that’s the decision point we reached when we made the announcement," Shepard said.

With lumber demand from the slumping U.S. housing market at its lowest level in years, Shepard said he sees no recovery in the near term.

"(This year) doesn’t look any better than 2007," Shepard said.

Frank Everitt, president of United Steelworkers union Local 1-424, said rumours of the job cuts had circulated through some of Canfor’s mills Monday.

"I think it’s certainly better than having downtime in all of the operations or indefinite shuts, but it is never good news when people lose their spendable income," Everitt said.

He said the union is organizing a conference in the northern Interior of British Columbia with the local college to encourage workers, especially those whose jobs were cut, to get new training during the industry downturn.

"It is to help them move on and educate themselves better, or retrain, whether it be for a different industry or to be better skilled when the industry takes an upswing."

Daryl Swetlishoff, an analyst with the Raymond James brokerage, said the cuts aren’t surprising considering the lumber markets are in a historic trough from the combination of the high Canadian dollar, sunken U.S. housing market and low lumber prices.

U.S. housing starts are down by at least a third in many regions because hundreds of thousands of American homeowners caught in the subprime mortgage mess have abandoned their homes or plan to do so when their mortgages are reset at far higher rates http://paydayintime.com. That has left a glut of houses on the market and sharply curtailed demand for new homes.

"You stack all of these factors on top of each other and it’s very, very difficult to be profitable today. You make more money by not operating, and it’s true of all companies in the sector," he said.

"A company like Canfor has a strong balance sheet and will weather the storm, but with the cash losses, this is a necessity."

Swetlishoff said cutting production is often better than closing mills because closures have a greater impact on communities, which could lead to workers relocating. When the industry recovers, the company is left with less qualified workers – a growing problem as labour shortages develop in many trades.

Canfor, which employed about 7,900 people at the end of 2006, operates mills in B.C., Alberta, Quebec, Washington state, and North and South Carolina.

The company is one of the largest producers of softwood lumber in Canada and also makes oriented strand board, a popular plywood substitute, as well as plywood, remanufactured lumber products and specialized wood.

It also owns 50.2 per cent of Canfor Pulp Limited Partnership, a major producer of northern bleached softwood kraft pulp in Canada and a manufacturer of kraft paper.

Canfor board member Jim Pattison had no comment on the latest cuts when reached by phone today.

Pattison, who owns a 29 per cent stake in Canfor through his investment company Great Pacific Industries Inc., said he wouldn’t comment on Canfor, or any other public company.

He has been pressing for changes to Canfor’s operations to stem mounting losses.

Last year, he helped defeat management’s plan for a “poison-pill" takeover defence against unwanted takeovers. Industry observers believed the poison pill was aimed at thwarting Pattison from acquiring more of Canfor to influence the company’s direction.

Shepard said Pattison had no say in the company’s decision announced today to cut production.

Earlier this year, Canfor reported a 2007 fourth-quarter loss of $237 million including an asset-impairment charge of $189.1 million, reversing a year-ago profit of $465.3 million which included $551.2 million of softwood lumber duty refunds.

Sales in the quarter fell to $711 million from $892 million.

On the Toronto Stock Exchange today, Canfor shares closed up 13 cents at $8.18.

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BRUSSELS, Belgium – The European Union on Monday opened the way for air travellers to use mobile phones to talk, text or send e-mails on planes throughout Europe's airspace.

With the approval by EU regulators, airlines will be able to launch onboard mobile services later this year, officials said.

Viviane Reding, the EU's telecommunications commissioner, warned phone operators not to set rates for the service too high and urged airlines to protect passengers from excessive phone use.

"In-flight mobile phone services can be a very interesting new service especially for those business travelers who need to be ready to communicate wherever they are," Reding said. "However, if consumers receive shock phone bills, the service will not take off."

The European Commission, the EU's executive body, said it will keep a close eye to ensure pricing is transparent.

Several airlines, including Air France, have already launched a trial of in-flight mobile phone services on some European routes. British Midland Airways, Portugal's TAP and low-cost airline Ryanair are also planning to offer services later this year.

Germany's Lufthansa, however, said Monday it does not want to introduce the service.

Surveys had shown that a large majority of customers were against it, Lufthansa spokesman Jan Baerwalde said.

"People don't want to be disturbed," Baerwalde said instant payday loan. Lufthansa will, however, look at providing fast Internet access on its planes, a service it already offered from 2004 until the end of 2006. The airline is currently looking for a new service partner to reintroduce the service.

The regulation sets a common standard by which passengers can safely use their mobile phones during flights and airlines will only need to get one license to launch their services across the entire 27-nation bloc.

Most services that are being rolled out this year are being provided by OnAir, a unit of planemaker Airbus. Their services allow in-air telephone calls above 9,800 feet.

EU spokesman Martin Selmayr said the phone services will not be available during take off or landing or during turbulence. He said the captain and crew of the plane can control when they want to switch off the onboard network.

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John Bitove, the fast-food franchise executive who founded XM Canada satellite radio, has been dealt a setback after Canada’s broadcaster regulator turned down his proposal to offer a free high-definition television service.

The Canadian Radio-television and Telecommunications Commission ruled against Bitove’s HDTV Networks Inc. because it would only offer two hours of local programming in eight cities, compared with 22 hours for current licensees, effectively making it a Canadian "superstation," an independent broadcaster that’s carried nationally without paying for programming in local markets.

"The programming strategy associated with such a station is inconsistent with the objectives of the Broadcasting Act and the commission’s policies," Michel Arpin, the CRTC’s vice-chair of broadcasting, said in a statement yesterday.

"We have never granted a licence for such a conventional television station in the past and did not find any compelling reason to do so at this time."

Bitove, who is also seeking to enter Canada’s $12.7 billion cellphone industry, had proposed to broadcast a high-definition signal free over the air and via cable and satellite TV services, effectively creating a new national broadcaster.

But the commission said it was not satisfied with HDTV’s local-programming commitment.

HDTV proposed to serve markets in Toronto, Vancouver, Calgary, Edmonton, Winnipeg, Ottawa, Montreal and Halifax.

Bitove, a former co-owner of the Toronto Raptors, could not be reached for comment.

The CRTC, which yesterday also denied a licence to YES TV Inc. to operate a high-definition service in Toronto, said local programming was an "integral" feature of its conventional television policy.

It noted that other stations and current licensees carry more than 22 hours of local programming per week on average.

The Canadian Association of Broadcasters argued that granting HDTV Networks a licence would give it an unfair advantage, since local programming is expensive payday loan online.

As well, the association took issue with Bitove’s submission that the service would be unique because it would be offered in a high-definition format, arguing that all broadcasters could conceivably be transmitting HD signals by 2011.

In addition to television, Bitove has also expressed an interested in becoming a major player in the telecommunications market after submitting an application to bid on wireless airwaves in an upcoming Industry Canada auction.

He also managed to persuade Microsoft Corp. co-founder Paul Allen to back the bid by Data & Audio-Visual Enterprises Wireless Inc.

Bitove’s move into the media industry comes as the fast-food business faces headwinds.

Priszm Income Fund, which owns franchised KFC and Taco Bell outlets across Canada and is headed by Bitove, announced a massive restructuring last fall that included closing or selling restaurants.

While Priszm officials said the overhaul was in response to rising costs and marketing missteps, some analysts expressed concern the fund was also at risk of being hurt by people’s increasing preference for healthier eating.

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It was bound to happen eventually: Air Canada now wants you to pay extra for better customer service.

In an era of continued cost-cutting, the country’s largest airline yesterday rolled out a new service called "On My Way" that, for a fee, promises to help passengers cope with delays and cancellations beyond the airline’s control, including bad weather or airport traffic.

"This is something that many airlines used to do in-house," said Rick Erickson, a Calgary-based airline consultant. "But since the advent of the low-cost carrier, everybody wants cheap fares."

Air Canada said passengers who opt to pay an additional $25 one-way on short-haul flights and an extra $35 one-way on long-haul routes within North America will receive "speedy" access to "specially-trained" customer service agents who will help rebook flights on Air Canada or other airlines, as well as pay for hotel stays and meals, if necessary.

Air Canada said the program, which applies to any flight cancelled within 48 hours of the scheduled departure, goes beyond the industry practice of assisting customers affected by schedule changes deemed to be the airline’s fault, such as mechanical problems with aircraft, scheduling glitches or crew members failing to show up for flights fastcash.

But while Air Canada is touting the program as an industry-first, at least one observer said it was once common for big North American carriers to go out of their way to help inconvenienced or stranded customers – free.

Erickson said Air Canada’s latest effort could prove popular given Canada’s unpredictable winter weather, particularly at the country’s largest airport in Toronto, where thousands of flights can be disrupted by a snowstorm.

However, Erickson cautioned that Air Canada will need to ensure customers who pay extra get their money’s worth.

"When there’s a disruption, everyone’s going to be calling at the same time," he said. "And if you can’t deliver on this, there will be real hell to pay as far as public relations go.

"People are going to have heightened expectations."

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OTTAWA – The president of Canada’s premier space technology firm says the Canadian government will maintain complete control of the Radarsat 2 satellite even if it is sold to a U.S. arms-maker.

Daniel Friedmann of MacDonald, Dettwiler and Associates told the Commons industry committee that the foreign affairs minister maintains the power to "close the shutter" on the state-of-the-art bird.

He was defending the pending $1.3-billion sale of MDA’s space technology division to Alliant Techsystems, a Minneapolis-based arms manufacturer.

Friedmann says the sale is the only way to ensure and increase access to all-important American government contracts http://us-no-fax-payday-loans.com.

He says that means the pending deal will preserve jobs in Canada, both for current MDA employees and for the many Canadian subcontractors who depend on the company.

Industry Minister Jim Prentice is currently reviewing the sale amidst widespread complaints that the crown jewel of Canada’s space industry is being sold to American interests and out of Canadian control.

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