Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation

June 08, 2005 08:15 ET

Canada Mortgage and Housing Corporation: Residential Sector Nearing Capacity

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - June 8, 2005) - Canada Mortgage and Housing Corporation (CMHC) figures indicate that housing starts in the Vancouver CMA dipped 3 per cent to 1,797 units in May over the same period last year. Multiple housing starts increased 2 per cent to 1,381 units, while single-detached starts dipped 17 per cent to 416 units compared to the same month last year.

"Residential construction activity has reached its limit in Greater Vancouver," said Cameron Muir, Senior Market Analyst. "Homebuilders are now working flat out, leaving little room for further expansion of the housing sector."

The combination of a limited land supply, increasingly complex developments, and a finite construction workforce has created a ceiling that limits the number of housing units that can be produced. Despite sufficient consumer demand, annual housing starts will not surpass 20,000 units anytime soon (a level exceeded in both 1993 and 1994). CMHC forecasts 19,400 housing starts in the Vancouver CMA this year, on par with the 19,435 housing starts of 2004.

"Prices have nowhere to go but up," added Muir. "Rising construction costs coupled with continuing low new home inventories will make sure of that." The average price of a new apartment condominium in the Vancouver CMA is forecast to climb a further 10 per cent to $345,000 this year.

Year-to-date, housing starts in the Vancouver CMA are down 10 per cent to 7,257 units over the same period last year. Single-detached starts declined 23 per cent to 1,802 units, while multiple starts dipped 4 per cent to 5,455 units compared to the first five months of 2004.

CMHC is Canada's national housing agency. The BC & Yukon Regional Business Centre produces a variety of reports which highlight trends in the new and resale housing markets.

To view the attached tables and map, please click on the following link: http://www2.ccnmatthews.com/database/fax/2000/cmhc0607.pdf


Contact Information

  • Canada Mortgage and Housing Corporation
    Cameron Muir
    Senior Market Analyst
    (604) 737-4144 or Cell: (778) 839-8590
    cmuir@cmhc.ca
    or
    Canada Mortgage and Housing Corporation
    Peggy Prill
    Market Analyst - Victoria/Vancouver Island Contact
    Cell: (250) 360-7322
    pprill@cmhc.ca
    or
    Canada Mortgage and Housing Corporation
    Paul Fabri
    Market Analyst - BC Southern Interior Contact
    (250) 712-4334
    pfabri@cmhc.ca
    www.cmhc.ca