Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation

October 26, 2015 08:15 ET

Housing Market Outlook for 2016 and 2017 Montreal CMA

MONTRÉAL, QUÉBEC--(Marketwired - Oct. 26, 2015) - According to the fourth quarter 2015 issue of the Housing Market Outlook report released by Canada Mortgage and Housing Corporation (CMHC), housing starts in the Montréal census metropolitan area (CMA) will reach 17,000 units in 2016 and 17,400 in 2017. As for Centris® sales, they will rise to 38,800 units and 39,500 units, respectively.

In all, starts should reach 17,000 units in 2016 (+1 per cent) and then 17,400 in 2017 (+2 per cent). During this period, rental housing starts will reach their highest level in a little over 10 years (approximately 6,500 units annually). "Construction of seniors' housing complexes will remain significant, but conventional rental housing starts will also increase. With the condominium market running out of steam, some builders have begun to look for other opportunities, and the low vacancy rate for newer rental buildings seems to indicate a certain demand for more modern units," said David L'Heureux, Senior Market Analyst at CMHC.

Regarding condominiums, the inventory of unsold units will remain at a relatively high level. The need for new units will remain limited in 2016 and 2017.

In the Montréal CMA, Centris® sales will rise by 3.5 per cent in 2016 to 38,800 units and by 1.8 per cent in 2017 to 39,500 units. This increase in demand will essentially result from the growth of Montréal's job market. "With rising demand and a relatively stable supply, market conditions will tighten very slightly in 2016 and 2017, but will remain favourable to buyers. In this context, just as in 2015, the overall average Centris® price will continue to post modest annual gains (+2 per cent) during the forecast horizon," he added.

In 2015, the vacancy rate in the Montréal CMA should continue to rise and reach 3.9 per cent. This easing of the market will be due essentially to a slowdown in demand. In 2016 and 2017, the vacancy rate will rise to 4.2 and 4.4 per cent, respectively, as supply will increase at a faster pace than demand.

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.

Follow CMHC on Twitter @CMHC_ca.

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