Canada Mortgage and Housing Corporation

Canada Mortgage and Housing Corporation

May 18, 2016 08:15 ET

Regina Housing Starts to Move Lower in 2016, Edge Higher in 2017

REGINA, SASKATCHEWAN--(Marketwired - May 18, 2016) - According to Canada Mortgage and Housing Corporation's (CMHC) Spring 2016 Regina Housing Market Outlook released today, total housing starts in the Regina Census Metropolitan Area (CMA) are forecast to range from 1,180 to 1,470 units in 2016 and from 1,240 to 1,530 units in 2017.

"In 2016, local builders will continue to navigate weaker economic conditions by channeling new demand towards their inventory of completed and unsold units, which will constrain total housing starts. A gradual improvement in economic conditions and continued depletion of inventory are expected to lead to a modest increase in housing starts in 2017", said Goodson Mwale, CMHC's Senior Market Analyst for Saskatchewan.

Single-detached starts in Regina are forecast to range from 580 to 670 units in 2016 and from 590 to 680 units in 2017. "After two years of sharp declines, single-detached starts are poised for some growth in 2016. Nonetheless, the expected gains will be an increase from very low levels and remain below the 2012-2013 production levels. Moving forward, the wide price gap between new single-detached units and condominiums represents some head winds for this sector over the forecast horizon. Nonetheless, a modest increase in production is expected for 2017," said Mwale.

After declining 28.5 per cent to 1,084 units in 2015, multi-unit starts are forecast to lead the reduction in Regina's housing starts this year and range from 690 to 720 units in 2016 and from 730 to 770 units in 2017. "The combination of weak labour market conditions and elevated inventory will delay some new multi-unit projects this year. Next year, a gradual improvement to the economic outlook will support a slightly higher level of production of multi-unit dwellings," added Mwale.

Regina's MLS® sales are forecast to remain relatively stable this year and range from 3,330 to 3,470 units in 2016, before edging up to be between 3,380 and 3,520 units in 2017. Persistent downside risks posed by lower oil prices have slowed employment growth and lowered net migration to the region. As a result, resale demand in Regina is expected to remain relatively flat this year, but edge higher next year as economic conditions improve.

Regina's average MLS® price is forecast to range from $306,000 to $314,100 in 2016 and from $310,400 and $318,600 in 2017. Buyer's market conditions are expected to continue putting downward pressure on house prices this year. However, market conditions are expected to improve next year due to slightly firmer resale demand, which will support a modest gain in prices.

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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Additional data is available upon request

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