Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation

May 18, 2016 08:15 ET

Ontario Housing Activity Will Remain Elevated in 2016

TORONTO, ONTARIO--(Marketwired - May 18, 2016) - Ontario housing activity is expected to maintain its momentum in 2016 before easing in 2017, according to the Second Quarter 2016 Ontario Housing Market Outlook - Regional Highlights Report released today by Canada Mortgage and Housing Corporation (CMHC).

"Despite an improving Ontario economy, housing activity is expected to ease over the forecast period as the cost of owning a home continues to increase," said Ted Tsiakopoulos, CMHC Regional Economist. "However, homes in southwestern and southern Ontario markets bordering the GTA tend to be more affordable, thus we expect a growing share of activity in those centres as we do for higher density housing which includes less expensive rental accommodation."

Report Highlights:

  • Ontario housing starts have been revised higher and are expected to range between 71,300 and 73,500 units in 2016 before slowing and ranging between 63,200 and 66,500 in 2017.
  • Existing homes, being less expensive, will register stronger sales activity ranging between 224,700 and 233,300 units in 2016 and ranging between 213,000 and 231,500 units in 2017.
  • Ontario home prices are expected to grow at a slower rate over the forecast period but post strong growth in the short run thanks to seller's market conditions.
  • Ontario average home prices will range between $505,500 and $516,100 in 2016 and $517,100 to $535,400 in 2017.

The presence of uncertainty creates some risks to the Ontario economic and housing outlook. This can result in a wider range of possible outcomes over the forecast horizon. Stronger growth in the US economy, interest rates remaining low longer and strong demand for single family homes could support much stronger housing activity. Alternatively, weaker job growth, growing imbalances in the housing market and rising inventories in both the resale and new home market could result in much weaker activity. Please refer to discussion on outer ranges in "Risks to Housing Outlook" section of Ontario HMO Regional Highlights Report for more details. This release includes video.

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.

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