Thunder Bay Housing Starts to Weaken This Year

THUNDER BAY, ONTARIO--(Marketwired - May 25, 2015) - According to Canada Mortgage and Housing Corporation's (CMHC) Spring Housing Market Outlook report for Thunder Bay, total housing starts will decrease slightly to 230 units in 2015 primarily due to fewer apartment starts and then increase to 255 units in 2016.

"Demand for new homes will soften in 2015 due to more choice in the resale market, and a lack of job growth," commented Warren Philp, CMHC Market Analyst. "A slight improvement in employment conditions in 2016 will lead to greater housing demand and therefore starts will edge up," concluded Philp.

Sales will increase by just 1.2 per cent to 1,460 homes sold in 2015, and be stable at 1,450 homes sold next year. Thunder Bay's tight resale market will become more balanced as the year progresses, due to a greater growth in new listings than in sales. As a result, average price growth will moderate from 8.1 per cent in 2014 to 4.7 per cent this year and 2.9 per cent in 2016.

The average vacancy rate will increase this year due to no job growth and more renters transitioning into homeownership. Employment will support rental demand next year, causing the vacancy rate to decrease. Expect two-bedroom average rents to increase by slightly more than 2.0 per cent both in 2015 and 2016.

As Canada's authority on housing, CMHC contributes to the stability of the housing market and financial system, provides support for Canadians in housing need, and offers objective housing research and information to Canadian governments, consumers and the housing industry.

For more information, visit www.cmhc.ca or call 1-800-668-2642. CMHC Market Analysis standard reports are also available free for download at CMHC Housing Market Information.

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