This is from CMHC May 21/99
HOUSING STARTS WILL MATCH 1998 PACE THIS YEAR AND RISE IN 2000
OTTAWA - May 21, 1999 - Starts should hit 137,100 units this year and 144,100 in 2000, compared with 137,439 in 1998, according to figures released today by Canada Mortgage and Housing Corporation (CMHC), in its second quarter National Housing Outlook report.
"One-time events, such as a series of strikes in the building trades and other industries as well as the deepening Asian crisis, hampered construction in 1998, but are unlikely to be repeated this year," said Michel Laurence, Manager, Economic and Housing Analysis, at CMHC's Market Analysis Centre. "Moderate job creation and reduced net migration will slow housing demand this year. Gains in 2000 will be due to more balanced regional economic growth."
Sustained employment gains, competitive prices and low interest rates will continue to support the resale market. Sales of existing homes will exceed 300,000 per year but will fall short of the 1997 record. Sales will increase marginally to 316,900 in 1999 and to 322,000 transactions in 2000. Average price growth nationally, will reflect increased sales in the higher-priced B.C. and Ontario markets.
Home building will be strong in Ontario and the Atlantic region this year. Ontario starts should benefit from a resilient economy, strong job creation and rising in-migration. This performance will continue into 2000.
Increased starts, forecast for the Atlantic region, reflect the positive effects of numerous megaprojects and high home ownership affordability due to relatively low house prices and low mortgage rates.
Housing starts should rise slightly in Quebec this year but more strongly next year. Improved job creation and reduced inventories of unoccupied units will support more home construction through 2000.
Weak global demand and resulting low commodity prices, are expected to lower economic prospects in the Prairies in 1999, undermining housing activity. Although activity will slow in Alberta, construction will remain at high levels this year and next.
Stagnant commodity markets, slower population growth and weak demand for condominiums, will reduce starts in British Columbia this year. Strength in new housing markets will continue to be limited to urban areas, which have shown strong job gains in the service sector. Improvements in Asian economies should trigger more housing construction in 2000.
- 30 -
For more information:
Michel Laurence, CMHC
(613) 748-2737 |
