Housing activity and prices will pick up next year as demand grows, Canada Mortgage and Housing Corp. says, and British Columbia will continue to be the most expensive real estate market.
After a lull in activity this year, new home building is projected to rise 16.2 per cent to about 164,900 units in 2010, the agency said in its fourth-quarter housing market outlook released yesterday.
The average listed price for a Canadian house is forecast to rise to $324,500 in 2010 from $312,950 this year. In British Columbia, the average list price is expected to hit $460,000, up from an estimated $452,000 this year.
"We expect housing markets across Canada to strengthen leading into and over the course of 2010 as economic conditions improve," CMHC chief economist Bob Dugan said.
Demand for homes has rebounded since the start of this year, he noted. And both new and existing home markets are seeing lower inventory levels.
"As a result, stronger housing demand will be reflected in higher levels of housing starts in 2010."
The strong pace of sales in the second and third quarters of 2009 partly reflects activity that was delayed in the previous two quarters "and is not likely to be sustained," the report said.
Housing starts across the country will likely fall 32.8 per cent from last year's levels to 141,900 this year, the agency said.
Existing home sales will reach 441,300 units in 2009 and increase to 445,150 units next year, as measured by the Multiple Listing Service.
Among provinces, housing starts in Saskatchewan will slide to just 3,600 units this year, nearly half the level of the previous year.
A strong economy and a relatively robust labour market, which will attract migrants to the province, will cause housing starts to rebound to 4,350 units next year, CMHC expects.
In Ontario, where activity has likely plunged 36.9 per cent this year from last year's level, starts are seen recovering to 56,500 units from an estimated 47,400 units this year.
The government agency also extended its forecast into 2013. It expects activity nationwide to increase to 187,000 units by 2013 as migration bolsters population growth. Activity will be particularly strong in Alberta and British Columbia, it says.