Vancouver Leads
Vancouver to lead major Canadian housing markets next year: study
Canadian Press - Thursday November 3, 2005
By Tara Perkins
TORONTO (CP) - Vancouver will take the No. 1 spot in Canada's housing market next year, while Toronto and Montreal will watch housing starts dwindle, according to a national forecast released Thursday.
Construction began on about 19,400 homes in Vancouver last year. The Clayton Housing Report forecasts that number will fall to 19,100 this year, but rebound to 21,100 in 2006 as employment growth strengthens.
Vancouver is posting a 12.7 per cent increase in housing prices so far this year.
Calgary will also see a construction lift, going from 14,100 starts this year to 14,800 next, as a shortage of existing houses for sale pushes more buyers to consider buying new.
But all of the other major markets have passed their prime, the report said.
"Of note is the sharp decline in Toronto which is linked to the emerging land shortages in that market," it added.
Between 1994 and 2003, Toronto saw shovels hit the ground on an average of 30,900 homes annually. Last year, 42,100 homes were started, and that should increase slightly to 41,200 this year.
In 2006, Clayton predicts starts in Canada's most populous city will drop to 34,700.
In the first nine months of this year, Toronto saw housing prices rise 6.9 per cent, the report said.
Montreal is experiencing a steady decline in starts, moving from 28,700 last year, to 24,100 this year and 19,300 next. Its prices have appreciated 7.7 per cent.
Edmonton, Regina, Ottawa and Halifax will also see starts fall next year, while Winnipeg should hold steady for the third year in a row at 2,500, the report said.
As buyers will be getting more selection in Vancouver and Calgary, renters are being pushed out. Starts of rental units are down by 38 per cent in Vancouver, and a whopping 95 per cent in Calgary, for the first nine months of this year.
Only 21 apartment complexes were started in Calgary during that period, compared to 463 in the same period of 2004.
Starts of rental buildings in Toronto have shrunk 13 per cent in the same time frame, from 1,093 to 955.
In contrast, Halifax has seen a 79 per cent increase, to 438.
The report noted that Toronto's condominium market is still buoyant. "Unsold new inventories are rising, but have been kept in check by continued strong sales," it said.
About 13,500 condos were sold in the first nine months of this year in the city, at an average price of $200,000.
"However, with almost 26,000 units under construction, we will be keeping a close eye on emerging supply issues," the report added.
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