Though housing starts in 2013 aren’t expected to reach the same levels as 2012, the Canada Mortgage and Housing Corporation (CMHC) believes 2014 will see building re-gain momentum. As employment, economic growth and net migration are all pegged to improve in the future, starts are expected see a boost as well.
“So far in 2013, the average monthly growth rates of MLS sales, new listings and prices have all been increasing. This follows a period of average monthly declines that held sway over the second half of 2012,” said Mathieu Laberge, Deputy Chief Economist for CMHC.
“This change in the trend of the resale market is expected to eventually lead to a similar change in the trend of the new home market, as housing starts dynamics typically lag the resale market by one to three quarters.”
After a period of moderation, housing starts are expected to range between 173,300 to 192,500 units in 2013, with a point forecast of 182,900 units, following a level of 214,827 units in 2012. In 2014, housing starts are expected to range from 166,500 to 211,300 units, with a point forecast of 188,900 units.
Home sales in 2012 came in at 453,372. CMHC is predicting sales to range between 412,000 to 474,800 units in 2013, with a point forecast of 443,400 units. The prediction for 2014? A slight increase over the expected 2013 numbers: a range from 435,800 to 501,400 units, with an increase in the point forecast to 468,600 units.
Prices are also expected to see a small bump. For 2013, the average MLS price is forecast to be between $359,400 and $380,00 and prices in 2014 are expected to come in between $362,400 and $392,200. CMHC’s point forecast for the average MLS® price calls for a 1.6 per cent gain to $369,700 in 2013 and a further 2.1 per cent gain to $377,300 in 2014.