TORONTO — New homebuilding in Canada is expected to regain momentum in the later part of 2013 and into 2014 as employment, economic growth and migration boost demand for housing in a market that had slowed, the Canada Mortgage and Housing Corp said on Tuesday.
“So far in 2013, the average monthly growth rates of MLS (multiple listing service) 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,” Mathieu Laberge, deputy chief economist for CMHC, said in the federal agency’s second-quarter outlook.
Canada’s housing market slowed dramatically in mid-2012 after the government tightened mortgage lending rules to head off a housing bubble. It was the fourth such move in five years. But the market has rebounded in recent months.
In its quarterly outlook, the CMHC said housing starts will be in the range of 173,300 to 192,500 units in 2013, with a point forecast, or most likely outcome, of 182,900 units, down from 214,827 units in 2012. Starts are expected to range from 166,500 to 211,300 units in 2014, with a point forecast of 188,900 units.
Existing home sales will slow to a range of 412,000 to 474,800 units in 2013, with a point forecast of 443,400 units, down from 453,372 in 2012. In 2014, sales are expected to move up in the range of 435,800 to 501,400 units, with a point forecast of 468,600 units.
Price gains are expected to slow in 2013 but regain some strength in 2014. CMHC’s point forecast for the average price calls for a 1.6% gain to $369,700 in 2013 and a 2.1% gain to $377,300 in 2014.