Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation

October 30, 2014 08:15 ET

Edmonton Housing Starts to Move Lower in 2015 and 2016

EDMONTON, ALBERTA--(Marketwired - Oct. 30, 2014) - According to Canada Mortgage and Housing Corporation's (CMHC) Fall 2014 Edmonton Housing Market Outlook released today, total housing starts in the Edmonton Census Metropolitan Area (CMA) are projected to moderate to 13,300 units in 2014. In 2015 and 2016, housing starts are forecast to decline further to 13,000 and 12,300, respectively.

"The pace of housing starts will moderate over the next few years as an elevated number of units under construction, particularly in the multi-family sector, tempers the pace of production," said Christina Butchart, CMHC's Senior Market Analyst for Edmonton. "Despite the reduction, total housing starts will remain elevated through 2016, supported by employment growth, rising incomes, and net migration," she added.

Single-detached housing starts are on pace to reach 6,400 units in 2014 and are expected to rise to 6,600 units in 2015. "Employment growth, rising wages, low mortgage rates, and relatively low inventory in the competing resale market are supporting growth in single-detached sector," said Butchart. In 2016, single-detached starts will moderate to 6,300 units, as mortgage rates slowly rise and the number of listings in the competing resale market moves higher.

Multi-family starts, which include semi-detached units, rows, and apartments, are projected to total 6,900 units in 2014, down from the 35-year high of 8,719 units in 2013. Although demand will remain strong over the next two years, supported by elevated migration, employment gains, and a low rental vacancy rate, builders will continue to pull back on housing starts to ensure that supply levels remain manageable. Multi-family starts are forecast to moderate to 6,400 units in 2015 and 6,000 units in 2016.

Supported by strong economic conditions, residential MLS® sales in Edmonton's resale market are projected to increase 2.3 per cent to 20,000 in 2014. Growth will continue in 2015 and 2016 as employment growth and elevated migration continue to support demand, albeit at a slower pace than previous years. Mortgage rates are expected to begin rising slowly in late 2015 and in 2016, which will moderate growth. Overall, sales will increase two per cent to 20,400 in 2015 before reaching 20,700 in 2016.

The average MLS® residential price is on pace to increase 4.4 per cent to $360,000 in 2014, the fastest rate of price growth in Edmonton since 2007. In 2015 and 2016, slower sales growth and an increase in the number of new listings will ease price gains to 3.1 per cent and 2.4 per cent, respectively. This will translate into an average price of $371,000 in 2015 and $380,000 in 2016.

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.

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 www.cmhc.ca/housingmarketinformation.

Follow CMHC on Twitter @CMHC_ca

Additional data is available upon request

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Contact Information

  • Market Analysis Contact:
    Christina Butchart, Senior Market Analyst
    (780) 423-8729
    cbutchar@cmhc.ca

    Media Contact:
    Charles Daniel Mainville
    Senior Communications Consultant
    (403) 515-2915
    cdmainvi@cmhc.ca