Those who watch real estate market conditions and clients who are close to retirement and wondering if the price of their home is going to come back to the recent highs witnessed, will likely be interested in the latest Housing Market Outlook released April 27 by the Canada Mortgage and Housing Corporation (CMHC).
In short, the CMHC says recent home price declines are expected to cease in mid-2023. This will put the average annual prices below 2022 levels, but mortgage rates are also expected to gradually decline, supporting demand.
Conditions are also expected to support a recovery in new construction but demand for housing is still expected to outpace new housing supply. “We foresee a significant drop in housing starts in 2023 than seen in the 2020-2022 period, but some recovery in 2024 and 2025,” says CMHC chief economist, Bob Dugan. “Consequently, supply gaps in Canada’s most expensive and supply-constrained housing markets, including Vancouver and Toronto, will worsen. Economic recovery and high immigration will add to housing demand in 2024 and 2025.” The report looks in some depth at 18 major housing markets through to the end of that period.
The report also discusses affordability for clients who aren’t property owners, saying growth in the number of renter households will put significant upward pressure on rents in the coming years.
