The Canadian Mortgage and Housing Corporation (CMHC) released its fourth quarter housing outlook last week and in part two of our four-part series, we take a look at what the organization foresees for Central Canada.
Saskatchewan’s employment is expected to outpace the national average, with real GDP forecasted to increase by 2.1 per cent in 2013 and 2.8 per cent next year.
2012 is expected to be the province’s peak for single-family units, with 2013 expected to see a decrease to 4,200 from 5,000 last year. However, solid employment growth is expected to buoy the number of starts above the region’s 10-year average.
“Despite the moderation, single-detached starts will remain above the 10-year average of approximately 3,400 units, supported by strong employment growth and rising wages,” the report stated. “In 2014, 4,200 units are expected to be started.”
Multi-family units are also expected to decline in 2013 and again in 2014.
“After a strong gain in 2012, multi-family starts are forecast to decline to 4,400 units in 2013, due to elevated supply levels,” the report stated. “With absorptions lagging completions this year, the inventory of complete and unabsorbed units is rising and will further slow the initiation of new multi-family projects to 3,800 units in 2014.”
Manitoba’s economy is expected to grow by 1.9 per cent in 2013 and two per cent in 2014, respectively; bolstered by wage growth, higher employment and an expanding population.
Single-family units are expected to see a decrease in 2013 to 3,900; following a boom in 2012. 2014 is forecast similar, with 4,000 starts expected. This numbers fall right in line with the historical average.
“Modest employment gains this year, combined with easing market conditions in the competing resale market, will result in starts below the peak set in 2012,” the report stated. “Nevertheless, starts this year and next will remain elevated by historical standards, supported by population growth and move-up buyers taking advantage of continued price gains in the resale market.”
Multi-family units are expected to exceed 2012’s numbers and reach 3,500 units by the end of this year. However, 2014’s starts are expected to decrease to 3,100 units, as many builders shift their focus to rental units.
“Low vacancy rates across the province are also encouraging builders to respond with new construction in the rental sector,” the report stated. “With increasing inventories expected next year, however, builders will ease production in 2014 to 3,100 units.”