Prairie Housing Starts to Increase in 2014 After Moderating in 2013

CALGARY, ALBERTA--(Marketwired - June 25, 2013) - According to Canada Mortgage and Housing Corporation's (CMHC) second quarter 2013 Housing Market Outlook, Prairies Highlights, report released today, housing starts in the Prairie Provinces are forecast to moderate to 47,400 units in 2013 before rising to 48,100 in 2014.

"A heightened pace of housing starts in 2012 increased supply levels substantially and will compete with new projects in 2013. By 2014, lower inventory, along with economic and demographic growth will encourage a higher level of new construction," said Lai Sing Louie, CMHC's Regional Economist for the Prairie and Territories Region. Housing starts in Alberta will decline by two per cent in 2013 to 32,700 units and then rise to 33,100 in 2014. Saskatchewan's housing starts are forecast to decline by over 20 per cent to 7,800 units in 2013 before rising to 8,000 in 2014. In Manitoba, housing starts will remain near 7,000 units through 2014.

In the resale market, Prairie MLS^® sales are projected to edge up to 88,400 in 2013 from 88,327 in 2012. High levels of migration, rising employment, and wage growth will support demand. On the other hand, higher monthly amortization costs will continue to impact some potential homebuyers. In Alberta, MLS^® sales are projected to rise by two per cent this year to 61,600 and to 63,300 in 2014. The record levels of MLS^® sales achieved in both Saskatchewan and Manitoba in 2012 are not expected to be surpassed over the forecast period, but sales in both provinces will remain elevated. MLS^® sales in Saskatchewan will ease to 13,200 units in 2013 before rising to 13,500 in 2014. Manitoba's resale transactions will moderate to 13,600 units this year and then rise to 13,800 in 2014.

The average resale price in the Prairie region is forecast to rise 3.6 per cent to about $342,600 in 2013 and $350,200 in 2014. Most local markets are projected to be in balanced conditions through 2014, supporting price growth. In Alberta, after increasing by 2.8 per cent in 2012, the average resale price is projected to rise by three per cent in 2013 to $374,200 and increase to $381,900 in 2014. In Saskatchewan, price growth is expected to moderate but the average MLS^® price will still rise by over three per cent to $283,100 in 2013 and to $289,300 in 2014. Price growth in Manitoba is expected to moderate as sellers' market conditions in Winnipeg ease. Nevertheless, the average MLS^® price in Manitoba will rise by over four per cent to $256,900 in 2013 and to $264,200 in 2014.

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.

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Additional data is available upon request

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