Last week the Canada Mortgage and Housing Corporation (CMHC) released a national housing outlook that says it expects housing starts to stabilize over the next two years. It also forecasts income and population growth that will support a rebound in home sales and prices.
The report states in part:
- Existing home sales are forecasted to stay near their 2018 levels until the end of 2019. Home sales will increase in 2020 and 2021 offsetting the declines observed since 2016, reflecting household disposable income growth.
- The average MLS® price is expected to decline for a second consecutive year from the recent high registered in 2017. Positive price growth is expected to resume in 2020 and 2021, driving the average price above its 2017 level by the end of the forecast horizon. Household disposable income growth and rates of household formation will support price growth.
In the last few months construction starts have made up for earlier softness with 223,507 units in September 2019, compared to 218,782 units in August 2019 The agency said: “Higher trending single-detached starts in urban centers since July, following several months of declines combined with higher-trending multi-family units in September (have pushed) the total starts to trend to its highest level since April 2018.”
Notable improvements were seen in Vancouver, Edmonton, Toronto, Kingston, Ottawa, Quebec City and cities in New Brunswick. The increases involve multi-family units and rental housing, often aimed at aging populations.
The HRAI/CIPH Outlook newsletter recently reported that the increase in residential permits in the second quarter suggested “an uptick in starts in the coming quarters. It noted that non-residential permits increased in the second quarter, for the third time in the past four quarters.”
Plumbing & HVAC Magazine said that seven provinces had gains in August when the value of building permits rose 6.1 percent to $9 billion. It said the value of permits for multi-family dwellings rose in every province, except Nova Scotia, increasing 18.8 percent to $3.3 billion in August.
Mechanical Business Magazine said that total investment in building construction across Canada increased 1.4% in August to $15.5 billion, with gains in both the residential and nonresidential sectors (+1.8% to $10.6 billion and +0.5% to $4.9 billion).
Links
http://plumbingandhvac.ca/general-increase-in-building-permits-for-august/
https://mechanicalbusiness.com/2019/10/22/building-investment-rises-in-august/