Thunder Bay Housing Market Slows – CMHC
THUNDER BAY – BUSINESS Housing starts in September were weaker in Thunder Bay. “Weaker employment levels than one year ago coupled with slowing average weekly earnings growth has affected consumer confidence impacting the residential construction market thus far this year in Thunder Bay,” stated Warren Philp, CMHC Market Analyst. “Improved employment conditions should boost housing starts, but only slightly, in 2015 and 2016,” added Philp.
According to Canada Mortgage and Housing Corporation’s (CMHC) Autumn Housing Market Outlook report for Thunder Bay, single-detached and semis, rows and apartment housing starts will slow this year. Expect only marginal increases in both single and multiples housing starts in 2015 and 2016 as the economy improves.
Listings growth especially in the higher priced ranges is being witnessed in the resale market, but for now, sellers’ conditions prevail. Anticipate a 6.5 per cent price growth in 2014 and a further 4.9 and 3.0 per cent in 2015 and 2016.
Rental demand meanwhile has remained strong supported by in-migration from elsewhere in Northwestern Ontario and the presence of increasing numbers of international students. Despite added rental supply in the form of condominium apartments, vacancy rates should fall throughout the forecast period. Expect two-bedroom average rents to rise above by 2.0 per cent in 2014 and another 2.3 per cent in 2015.
Ontario Housing Momentum Continues
The momentum in the Ontario housing market will be sustained through most of 2015 before slowing later next year and into 2016, according to the Fourth Quarter 2014 CMHC Housing Market Outlook – Canada Edition released today. After declining in 2014, Ontario annual home starts will grow to 63,000 units in 2015 and will range between 57,500 and 67,900 units before slowing to 60,400 units in 2016.
“An improving economy will be more supportive of the Ontario housing market in 2015. However, as mortgage carrying costs continue to grow, due largely to rising home prices, demand will increasingly shift to more affordable housing by 2016,” said Ted Tsiakopoulos, CMHC`s Ontario Regional Economist. “Neighbouring resale markets surrounding the GTA, higher density dwellings and rental over ownership tenure will benefit most from the continued shift in buying patterns.”
Ontario existing home sales will gradually lead the market higher with MLS(R) sales growing to 210,500 units in 2015 before slowing to 202,700 units in 2016. MLS(R) sales will range between 199,500 to 221,300 units in 2015. Ontario home prices will grow at a slower rate over the forecast horizon.