Winnipeg will be one of the few
cities in Canada to have increased residential construction activity in 2007
and 2008, according to a new report
by Canada Mortgage and Housing
The spring 2007 Winnipeg Housing Market Outlook forecasts 3,000 housing unit starts for 2007 and 2,900 units in 2008 in the Winnipeg Census Metropolitan Area, which includes the city and surrounding municipalities.
The total for 2007 represents the best performance on record since 1988 when starts reached 4.071 units.
Vinay Bhardwaj, CMHC’s manager of market analysis for the Prairie and
Territories Region, said increased construction of multiple-family residential units will be responsible for a significant portion of starts.
“The rising cost of owning a single-
detached home is causing buyers to increasingly consider the purchase of a semi-detached, row or apartment unit in several major centres across Canada,” he said. “The same phenomenon is now taking hold in Winnipeg since over half of the population is distributed within the first-time and move-up buyer age brackets.”
After recording 1,040 multiple-family starts in 2006, CMHC is forecasting multiple-family starts will hit 1,350 units in 2007 and 1,250 units in 2008.
“This will be the first time since the 1986 and 1988 period that annual multiple-family starts will have eclipsed the 1,000-unit level for three consecutive years,” added Bhardwaj.
Earlier in the year, WinnipegREALTORS® Association president Wes Schollenberg also predicted an upswing in multiple-family residential starts.
“Condos are taking off,” Schollenberg said. “We’re behind other centres in condo development, but there are more developments coming on stream to meet the growing demand.”
The CMHC outlook said demand for new single-detached units in Winnipeg is being propelled by the continued growth in the number of households and the low level of resale homes available on the market.
CMHC is predicting that single-family builders will continue to operate at a high capacity, but 2007 and 2008 starts will not match the levels achieved from 2004 to 2006.
CMHC said single-family starts will slip from 1,737 units in 2006 to 1,650 units in both 2007 and 2008.
Across Manitoba, CMHC said strong non-residential construction activity, a solid job market and an increased level of international immigration due to the successful Provincial Nominee Program will continue to support high levels of new home construction. Total housing starts are expected to edge lower from 5,028 units in 2006 to 5,000 units in 2007 and 4,900 units in 2008.
The average price of a newly-built
single-detached home in Winnipeg and the surrounding municipalities jumped from $198,382 in 2002 to $267,430 in 2006, which represents a compound annual growth in the average price of 7.8 per cent.
CMHC is predicting that the average price of a new single-family home will rise to $300,000 in 2007 and $325,000 in 2008.