Strong city economy set to boost housing

The economic forecast for Calgary is positive, says a federal expert who spoke to more than 650 members of the Canadian Home Builders' Association-Calgary Region.

The city can expect strong employment growth for 2012 and increased net migration - both of which will contribute to a strong housing market, said senior market analyst Richard Cho of Canada Mortgage and Housing Corp.

He spoke during a recent meeting of the association.

CMHC predicts employment growth to stay steady at 2.4 per cent and net migration to reach 17,000.

A total of 10,300 new homes should be started this year - the first time starts have been more than 10,000 since 2008.

Since 2009, activity has been increasing especially in the multifamily apartment segment.

"In particular, we will be seeing low-and mid-rise buildings, particularly in desirable inner-city areas," said Cho.

Multi-family starts will likely be up the most - 4,800 compared to 4,208 last year. In fact, last December, multi-family starts hit 505, compared to just 153 in December of 2010, and the majority of those were apartment starts, said Cho.

Detached single-family starts should reach 5,500, up from 5,084 in 2010.

On the building permit side, which are a builder's intention to build and not actual starts, the City of Calgary issued building permits for 9,812 new residential units in 2011 - up 40 per cent from 2010, when 7,026 were issued.

Of the 9,812 units, 3,412 were for new apartments, which is a 189 per cent increase compared to 2010.

On the resale side, CMHC predicts that total sales in the resale market will only record a slight increase from an estimated 22,468 to 22,700 this year.

The average price will likely go up to $411,000 from approximately $402,848 last year.

"As the market becomes more balanced, you can expect to see more pressure on prices," said Cho

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Ali Abdalla

Ali Abdalla

CENTURY 21 Bravo Realty
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