Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation

June 25, 2013 08:15 ET

2013-2014 Housing Market Outlook (Province of Quebec)

MONTRÉAL, QUÉBEC--(Marketwired - June 25, 2013) - According to the latest forecasts conducted by Canada Mortgage and Housing Corporation (CMHC), recently slower economic growth will reduce demand of existing and new homes in Quebec this year. Moreover, easing resale markets and relatively high inventories of new dwellings will significantly lower housing starts in 2013. " This being said, still favourable borrowing conditions and demographic trends will support housing demand into 2014, at which time a strengthening economy and tightening resale markets will energize both the resale and new housing markets," said Kevin Hughes, CMHC Regional economist for the province of Quebec

In 2013, moderate job growth, the continued easing of the resale market and the trend toward multi-family dwelling will again reduce single starts and translate into a total of 14,200 single-detached homes started. In 2014, a tighter resale market will bring some support and result in 14,500 single starts. The trend toward the multi-family market segment is explained by its relative affordability, the changing needs of an aging population and by densification trends.

Fuelled by the popularity of condominium apartments, supply in this market segment has increased significantly. As a result of three years of sustained construction from 2010 to 2012, market conditions in this market have eased significantly. Starts of multi-family dwellings will thus decrease considerably this year. Multiple starts will descend below the 25,000 level in 2013 and rise above the 26,000 mark in 2014.

While holding steady in 2012, sales recorded by Centris® have been recently declining as a result of the overall economic context discussed previously. Despite a certain rebound in the second half of this year, resales will come in at a lower level this year. For 2013, 72,400 such transactions are forecast. As buying conditions improve, total resales will be back in growth mode next year. In total, 76,500 Centris® sales are forecast for 2014.

Relatively lower demand for resale homes, combined with rising supply, has taken pressure off price growth in recent quarters and should continue to do so throughout this coming year. With a return to more balanced conditions, price growth in the resale market will continue to moderate in 2013. The average price recorded by Centris® will reach $271,200 in 2013 and $274,200 next year.

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.

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