Canada Mortgage and Housing Corp. has revised upward its expectations for Central Alberta’s resale market this year and next.
In its fourth quarter housing market outlook, issued on Thursday, the national housing agency said it now anticipates that there will be 4,800 Multiple Listing Service sales in the area this year and 5,000 in 2014.
Those figures are up from 4,304 in 2012, and are also higher than the projections in CMHC’s third quarter housing market outlook in August, when it was forecasting 4,700 sales this year and 4,900 in 2014.
CMHC expects prices to average $299,000 this year and $310,000 next year, as compared with $279,180 in 2012. The agency’s previous outlook called for an average price of $295,000 this year and $301,000 in 2014.
When it comes to new residential construction in Red Deer, CMHC’s latest forecast is unchanged from August. It’s anticipating starts on 365 single-detached homes and 325 units in multi-family projects, for a total of 690 in 2013. Next year, these numbers are expected to swell to 385 for single-detached and 330 for multi-family homes, for a total of 715.
Last year, housing starts in the city numbered 568 — 326 single-detached and 242 multi-family.
In an analysis accompanying its most recent housing market outlook, CMHC said markets like Calgary, which are experiencing tight resale market conditions, will see more buyers looking to the new home market.
It added that single-detached starts should rise this year and next in most of Alberta’s seven largest urban centres.
Multi-family starts will decline in Edmonton next year, due to heightened supply levels, said CMHC. But work on multi-family projects in Calgary should increase.
CMHC said that Alberta’s high level of net migration will help support resale housing demand through 2014. Employment and wage growth should also contribute to a higher level of resale transactions, it added.
CMHC expects the average MLS price in Alberta to reach $379,200 in 2013 and $387,400 in 2014.
It noted that the sales-to-new-listings ratio for Alberta has been trending higher, which indicates stronger demand relative to supply.
CMHC expects new listings to increase in 2014, as sellers take advantage of higher valuations, which in turn should help moderate the pace of price growth.
Nationally, CMHC expects slightly more housing starts this year and slightly fewer in 2014 than it was predicting in its August outlook.
That will result in a period of relative stability, although both years will be slower than 2012.