Quebec Housing Starts to Moderate in 2016-2017

MONTRÉAL, QUÉBEC--(Marketwired - Oct. 26, 2015) - Quebec housing starts will moderate this year and increase slightly next year, according to the latest forecasts conducted by Canada Mortgage and Housing Corporation (CMHC).

"Gradual acceleration of Quebec's economic growth will provide some stimulus to housing demand in 2016 and 2017. As a result, the province's resale markets will slightly tighten and prices will remain sustained," said Kevin Hughes, CMHC Regional Economist. "Meanwhile, the effects of population aging in the province will contribute to residential construction, in particular to the multi-family market segment".

It is unlikely that moderate employment growth and a tightening resale market will have significant impact on demand for new single-detached homes in the forecast period. Rather, demand in this market segment will continue to be held back by rising demand for apartments. Starts will be situated within the 8,200 and 10,900 levels in 2016 and within the 7,800 and 11,700 levels in2017.

While condominium starts continue to slow due to relatively high levels of supply, renewed activity in the retirement home segment and in the purpose-built rental market in some areas of the province will push up multi-family starts in both 2016 and 2017. Starts in this segment will lie within a range of 21,300 to 28,200 units next year. Currently, the range for 2017 includes a lower bound of 20,200 starts and an upper bound of 30,300 starts.

Sales of existing houses recorded by Centris^®(1) should increase slightly during the next two years, in line with employment growth. In 2016, sales should lie within a range of between 67,600 and 81,300 units. Currently, the range for 2017 lies between 63,100 and 89,400 sales.

Despite relatively high supply levels in certain market segments, gradual tightening will sustain price growth during the forecast horizon. In this context, prices of resale homes will range between $264,500 and $293,500 next year and between $256,200 and $311,300 in 2017.

(1) The Centris^® system contains all listings of real estate agents in Quebec.

As Canada's national housing agency, CMHC draws on more than 65 years of experience to help Canadians access a variety of 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 a thttp://www.cmhc.ca/housingmarketinformation.

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