CMHC expects housing market to recover in next two years after declines

Home sales are expected to increase in the next two years, with prices also going up

Canada’s federal housing agency expects the housing market to recover in the next two years after declines in home building, sales and prices.

Canada Mortgage and Housing Corp. said in its annual market outlook Thursday that housing starts should come in at around 200,000 units in the next two years. That’s above the roughly 194,000 expected this year but still well below the decade-high of almost 220,000 units in 2017.

“Housing starts are projected to stabilize in 2020 and 2021 at levels in line with long-run averages. This follows two years of declines from elevated levels in 2017,” CMHC chief economist Bob Dugan said in the report.

Home sales, which have been dropping since 2016, are expected to increase in the next two years, with prices also going up, Dugan said.

READ MORE: UN report highlights ‘abhorrent’ housing conditions for Indigenous people

“Resale activity and house prices are expected to fully recover from recent declines, supported by growth in income and population.”

Home sales reached 533,353 in 2016, but fell to 452,189 last year. By 2021 sales could reach somewhere between 498,500 and 519,100, the agency said.

The average home price hit $511,830 in 2017, but it’s expected to come in at around $488,000 this year. CHMC said the average price could be between $539,800 and $569,600 by 2021.

Ontario and British Columbia are expected to lead in sales growth as disposable income grows above the national average, while price growth will be strongest in Ontario and Quebec and somewhat B.C.

The growth in sales and price is expected to come as economic growth recovers in the next two years, and the population is expected to grow to 38.3 million by 2021. That would be an additional 713,000 people from the 2019 population, and an increase of 2.17 million people from 2016.

CMHC warned that trade tensions and high household debt still present risks to the economy and housing market stability. It also said higher interest rates or a rise in unemployment could hit already strained budgets and put pressure on housing activity.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

South Surrey man to bike across Canada

Last minute decision to take Rajiv Dhaliwal on three-month journey

White Rock RCMP reviews street checks for racial bias

Report indicates checks are being conducted bias-free

Provincial COVID-19 data can now be used for B.C. to prepare for a second wave

In the past week, B.C. has seen a slight spike in daily test-positive case counts

PHOTOS: Surrey rally supports Mona Wang, calls for wellness check reform

Security camera footage shows Wang being dragged, stepped on during RCMP wellness check at UBCO

Filming applications ‘coming in slowly’ to the City of Surrey

Netflix cancels ‘Sabrina’, but filming manager says new calls coming in to film in Cloverdale

Islanders want BC Ferries to follow order that lets residents board before tourists

For ferry-dependent communities, ferries are often the sole practical lifeline to work, school or medical appointments.

Fraser Valley loses the Keith Wilson Waver as Ron Hupper passes away

Hupper brought smiles to the faces of hundreds of people traveling Chilliwack’s Keith Wilson Road

Beverly Hills 90210 star’s family selling Vancouver Island Beach Resort

You can own Jason Priestley’s Terrace Beach Resort in Ucluelet for less than $5 million

Genetic detectives begin work to trace spread of COVID-19 in Canada

The kinds of genetic technology being used for this project did not exist when SARS hit Canada in 2003

Sports fishers protest Fraser River Chinook closures

Public Fishery Alliance wants hatchery fish open for harvest

B.C. Ferries increasing passenger capacity after COVID-19 restrictions

Transport Canada 50-per-cent limit being phased out, no current plans to provide masks

Once-in-a-lifetime comet photographed soaring over Abbotsford

Photographer Randy Small captures Comet NEOWISE in early-morning sky

Amber Alert for two Quebec girls cancelled after bodies found

Romy Carpentier, 6, Norah Carpentier, 11, and their father, Martin Carpentier, missing since Wednesday

Most Read

l -->