Once again I had a chance to attend the CMHC Housing breakfast at the Hotel Beau. I enjoy these annual seminar's as it is an excellent chance to learn more about the economics of the Atlantic Provinces, and more importantly, the local market.
One thing which was repeated in many different ways was that Atlantic Canada faired much better than the rest of the major markets, and Moncton did better than most of Atlantic Canada. The second thing was that CMHC feels that the mortgage rule changes introduced by the Federal Finance Minister will not have a significant impact on our local market and they expect a slight growth in sales and prices, in the 2% range, for both 2010 and 2011. No housing bubble here to worry about!
CMHC is predicting a stabilization of the world markets, especially the US and China, and a small increase in housing starts in the US will be good news for our lumber mills. They are also expecting stable oil and commodity prices in 2010.
One area CMHC expressed concerned about was the fact that Atlantic Canadians, traditionally cautious spenders, have seen an increase in disposable income but a drop in savings. Also, nearly all of our population growth has been because of International immigration, not inter Provincial migration. That's fine as long as we continue to attract people to this region. A lack of younger workers effects the chances of larger companies relocating here.
In Moncton, our population has gone up 9418 since 2001 - 80% of which was young families. That's very good news indeed.
CMHC feels we have a balanced market in Metro with average time on market set at 103 days. Sales volume was down a bit last year but our average sale price was up about 4%. Our vacancy rate is under 4% so we should see a few more apartment complexes built in the area this year.
The price of new construction continues to go up faster than the overal market. The average cost of a new bungalow is now $223,799 an increase of 12.2%. Two story homes are now $261,626, an increase of 6%.
Our average resale price was up about 4% in 2009. Currently, CMHC puts Dieppe's average sale price in 2009 at $171,461, Riverview's was $149,793, and Moncton's $154,000. We still have some of the most inexpensive housing in the country.
If you have an interested ina more detailed analysis, contact me by email and I will forward the CMHC report to you.