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Friday, January 22, 2010 - Edmonton Housing Market Outlook 2010

Richard Goatcher is the Senior Market Analyst at Canada Mortgage and Housing Corporation (CMHC), who spoke at the Housing Forecast Seminar this January about Edmonton Housing Market Outlook. His thoughts are concluded below:

  • Richard Goatcher stated that full-time job creation is needed to sustain demand for housing. In 2009, there was a negative employment growth – Richard (CMHC) is predicting employment growth will return in 2010.
  • In 2009, unemployment numbers were the highest since 1997. 2010 numbers are forecasted to mimic this rate (just above 6%), which gives caution to first-time home buyers.
  • Total Net Migration forecast is still strong by historical standards, just above 16,000.
  • Strong MLS system sales in 2009 – close to record levels in July.
  • Inventory of active listings down from the peak (which was just under 11,000 listing in July 2008 to just above 4000 today).
  • Average days on market vary depending on month. A balanced market is typically 40-55 days. As of December 2009, we are currently at 50 days-on-market.
  • Prices stabilizing as market balance improves
  • Sales activity in 2010 is forecasted to remain on par with 2009, perhaps improving slightly.
  • Resale home price growth is forecasted to return in 2010 (approx. 4-5%). If inventory stays low, it may put some pressure on prices.
  • Single-detached home starts are up (activity levels have ramped up) and units “under construction” stage have a modest upswing. Single-detached starts are still well-below average for this decade.
  • Single-detached inventory: Show home numbers are up while spec homes are depleted.
  • Recent price reductions attract buyers to the market.
  • Multi-unit construction down by 50% from December 2008. Large decline in apartments also underway. Condo market is well supplied, but government is coming to companies to help with affordable housing creation.
  • Lots of condo inventory… standing empty or close to completion. Over 400 condos absorbed in December 2009, with the majority being in the downtown and southwest city quadrants.
  • Apartment vacancy rates were quite high in 2009 (4.7%) . Forecasted number to hopefully dip below 4% due to immigration. Higher vacancy rates help to slow rent increases (vacancy rates must be below 2% in order to have rent increases).
  • When asked, “What can we expect in terms of CMHC lending policies?", Richard simply stated we’d have to wait to hear from the Department of Finance on budget day.

 

 

posted in General at Fri, 22 Jan 2010 14:31:07 -0700

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