Total annual Canadian housing starts are expected to be lower in 2013 relative to 2012, according to the Canada Mortgage and Housing Corp.'s (CMHC) housing market outlook for the first quarter of this year. However, the CMHC forecasts a new momentum in employment, economic growth and net migration later this year and into next year, thus propelling housing starts in 2014.
‘The CMHC expects housing construction activity will trend lower in the first half of 2013, before gaining more momentum by the end of the year as economic and employment growth remain supportive of the Canadian housing market,’ says Mathieu Laberge, deputy chief economist for the CMHC. ‘In 2014, improving economic conditions may be partially offset by a slight moderation in the number of first-time homebuyers and potential small and steady increases in mortgage interest rates.’
On an annual basis, Canadian housing starts are expected to range between 178,600 to 202,000 units this year, with a point forecast of 190,300 units, following a level of 214,827 units in 2012. In 2014, Canadian housing starts are expected to range from 171,200 to 217,000 units, with a point forecast of 194,100 units.
Existing home sales in Canada are expected to range between 418,200 to 484,000 units in 2013, with a point forecast of 451,100 units, following a level of 453,372 in 2012. In 2014, multiple listing service (MLS) sales are expected to range from 439,600 to 505,000 units, with an increase in the point forecast to 472,300 units. The average MLS price is forecast to be between C$356,500 and C$378,500 in 2013 and between C$363,800 and C$390,800 in 2014.