Canada’s Housing Market to Remain Stable Through 2016
By Lucas on May 25, 2015
The Canada Mortgage and Housing Corporation (CMHC) has released its Housing Market Outlook, Canada Edition for the second quarter of 2015, announcing that the country’s housing markets should remain stable for the rest of the year and throughout 2016.
Though Canada’s housing markets are forecasted to remain stable, there are still a few risks and vulnerabilities at hand. For example, “Lower oil prices are contributing to disparities between provincial housing markets,” explains Bob Dugan, Chief Economist for CMHC. “A slowdown in housing starts and resale transactions in oil-producing provinces such as Alberta will be partly offset by increased housing market activity in other provinces, such as Ontario and British Columbia, which benefit from the positive impacts of declining energy prices, a lower Canadian dollar and continued low mortgage rates.”
Dugan goes on to point out that since the inventory of completed and unsold units is higher than the historical average, he expects new home builders and developers to adjust over the next couple years to manage their current inventories. High inventories may be the case in many parts of Canada, but BILD recently announced that the inventory of new low-rise homes in the GTA is at an all-time low, so perhaps we won’t see a slowdown in the GTA.
Canterbury - via Tribute Communities
National housing starts are expected to range between 166,540 and 188,580 units in 2015, with a point forecast of 181,618 units. For 2016, starts are predicted to range from 162,840 to 190,830 units, with a point forecast of 181,800.
MLS sales throughout Canada are expected to range from 437,100 to 494,500 in 2015, and the point forecast is 475,400. Next year, CMHC believes MLS sales will range between 424,500 and 491,300, with a point forecast of 469,000.
The average price for a home sold through the MLS system is expected to range from $402,139 to $439,589 in 2015, with a point forecast of $422,129. In 2016, CMHC believes that the average MLS price will be between $398,191 and $457,200, with a point forecast of $428,325. Between 2015 and 2016, it is predicted that there will be a slowdown in the rate of price growth in the resale market.
We’re interested to see how both the resale and new home markets perform for the rest of 2015. Stay tuned - we’ve got a close eye on all market stats and new home industry highlights!
