Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation

October 26, 2015 08:15 ET

Regina Housing Starts to Decline in 2015 and 2016 But Rise Slightly in 2017

REGINA, SASKATCHEWAN--(Marketwired - Oct. 26, 2015) - According to Canada Mortgage and Housing Corporation's (CMHC) Fall 2015 Regina Housing Market Outlook released today, total housing starts in the Regina Census Metropolitan Area (CMA) are forecast to decline to 1,800 units in 2015 and 1,785 in 2016 before increasing slightly to 1,800 units in 2017.

"Weaker economic activity and employment growth, combined with lower net migration to the region, will reduce housing demand and moderate total housing starts in 2015 and 2016. A gradual improvement in economic conditions in 2017 will prevent housing starts from declining further, resulting in a slight increase in new construction," said Goodson Mwale, CMHC's Senior Market Analyst for Saskatchewan.

Single-detached starts in Regina are on pace to reach their lowest level since 2001, totalling 500 units in 2015. Weaker economic conditions and elevated single-detached inventory for most of this year have moderated building intentions in Regina, while single-detached builders have also faced competition from increased supply in the resale market. With employment growth expected to remain muted in 2016, single-detached starts in Regina are forecast to reach 510 units, before edging up to 520 units in 2017.

Multi-family starts, which include semi-detached, row, and apartment units, are forecast to decline further to 1,300 units in 2015. In 2016, multi-family starts will continue to move lower, to 1,275 units, due to elevated inventory, higher apartment vacancy rates and competition from Regina's existing home market. A gradual improvement in economic conditions will result in a slight increase in multi-family starts to 1,280 units in 2017.

Existing homes sales in Regina are on pace to reach 3,470 MLS® transactions in 2015, seven per cent fewer than in the previous year. Persistent downside risks posed by lower oil prices have slowed employment growth and lowered net migration to the region, thus moderating housing demand. In 2016, Regina's MLS® sales are forecast to remain relatively stable at 3,500 units, before improving economic conditions in 2017 help lift sales slightly to 3,550 units.

Persistent buyer's market conditions will result in a 1.9 per cent decline in Regina's average MLS® price to $309,000 in 2015. A modest gain to $309,500 is projected for 2016, with the average resale price forecast to rise further to $312,595 in 2017.

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.

For more information, visit http://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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