CMHC forecasts slower spring housing market

‘Although condo starts will decrease on weaker demand for new units, they will remain elevated and will account for the bulk of total residential construction’

By Ted Tsiakopoulos –

Canada Mortgage and Housing Corporation (CMHC) released its Spring Housing Market Outlook report for the Greater Toronto Area. New home starts are forecast to edge lower to 33,400 units in 2013, primarily due to condominium apartment segment pulling back from a record high level registered in 2012. Low-rise homes (singles, semis, and rows) are projected to push total housing starts higher by four per cent in 2014.

With more potential homebuyers on the sidelines, GTA MLS(R) sales will inch down to 84,500 units in 2013. Next year’s sales, which are expected to recover to 89,500 units, will align well with the past five year average.

Although condo starts will decrease on weaker demand for new units, they will remain elevated and will account for the bulk of total residential construction. Both low-rise and high-rise pre-construction sales should see gradual improvements through 2014 thanks to stronger growth in the economy, improved migration boosting household formation and more low-density housing options.

As Canada’s national housing agency, CMHC draws on more than 65 years of experience to help Canadians access a variety of high quality, environmentally sustainable and affordable housing solutions. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making informed decisions.

Ted Tsiakopoulos is CMHC’s Regional Economist. For more information. CMHC Market Analysis standard reports are also available free for download.