Economic Outlook
Economic
fundamentals point to a pickup in housing demand during the last half of 2012
following modest growth in the first two quarters of 2012. Although the level
of employment was flat during the first quarter, full-time employment rose while
part-time employment declined compared
to year-ago levels. Total employment picked up during the second quarter of
2012 and the shift no full-time employment continued. This trend is expected to
support homeownership demand in the second half of this year.
Population-driven
demand from individuals moving to the province from other countries is the main
source of demographic demand for new and resale housing. First
quarter international migration was higher than the level recorded during the first
quarter of 2011. However, net interprovincial
migration was negative during the first quarter. Overall, though, total net
migration was positive.
Housing Market Outlook
Housing
starts in British Columbia are forecast to increase gradually in the second
half of this year and in 2013 to a level consistent with economic fundamentals
and household formation.
This year, growth will be concentrated in multiple-family housing with a stable
level of single detached starts. Meanwhile, 2013 will see multiple-family
housing starts level off, while single-detached home starts are forecast to
rise. Total housing starts are expected to total 28,500 units in 2012 and
30,100 units in 2013.
Expect
single-detached home starts of 8,900 in 2012 and 9,900 in 2013. In the first
half of 2012, well-supplied resale markets offered choice to homebuyers,
drawing some demand away from new single-detached homes. This trend should
continue during the second half of 2012. Next year,
fewer listings, higher existing home sales and firmer resale prices are
expected to shift some demand from resale housing back to new homes.
The
forecast level of multiple-family housing starts, including apartments, semi-detached
and row homes is revised higher in this quarterly forecast due to an increase
in larger projects, including some rental. Moving forward, however, starts are
forecast to stabilize at levels consistent with underlying demand over the
forecast period. Demand from first-time homebuyers, empty-nesters and others
choosing condominium living is expected to result in 19,600 multiple family starts
in 2012 and 20,200 starts in 2013.
On a
quarterly basis, the number of resale transactions is forecast to gradually
improve in the rest of 2012, in line with strengthening employment and
population growth. Provincial resale market conditions are forecast to remain
in balance during the rest of this year and next, although local market
conditions will vary. Existing home prices, as measured by the average MLS® price, moved lower during the
second quarter of 2012 after modest growth in the first quarter.
The average annual price for 2012 is forecast to be $522,200 while 2013 will
see a slight increase to $535,700 as resale activity picks up.
Copyright CMHC
Copyright CMHC
No comments:
Post a Comment