CMHC expects housing market to recover in next two years after declines

Home sales are expected to increase in the next two years, with prices also going up

CMHC expects housing market to recover in next two years after declines

Canada’s federal housing agency expects the housing market to recover in the next two years after declines in home building, sales and prices.

Canada Mortgage and Housing Corp. said in its annual market outlook Thursday that housing starts should come in at around 200,000 units in the next two years. That’s above the roughly 194,000 expected this year but still well below the decade-high of almost 220,000 units in 2017.

“Housing starts are projected to stabilize in 2020 and 2021 at levels in line with long-run averages. This follows two years of declines from elevated levels in 2017,” CMHC chief economist Bob Dugan said in the report.

Home sales, which have been dropping since 2016, are expected to increase in the next two years, with prices also going up, Dugan said.

READ MORE: UN report highlights ‘abhorrent’ housing conditions for Indigenous people

“Resale activity and house prices are expected to fully recover from recent declines, supported by growth in income and population.”

Home sales reached 533,353 in 2016, but fell to 452,189 last year. By 2021 sales could reach somewhere between 498,500 and 519,100, the agency said.

The average home price hit $511,830 in 2017, but it’s expected to come in at around $488,000 this year. CHMC said the average price could be between $539,800 and $569,600 by 2021.

Ontario and British Columbia are expected to lead in sales growth as disposable income grows above the national average, while price growth will be strongest in Ontario and Quebec and somewhat B.C.

The growth in sales and price is expected to come as economic growth recovers in the next two years, and the population is expected to grow to 38.3 million by 2021. That would be an additional 713,000 people from the 2019 population, and an increase of 2.17 million people from 2016.

CMHC warned that trade tensions and high household debt still present risks to the economy and housing market stability. It also said higher interest rates or a rise in unemployment could hit already strained budgets and put pressure on housing activity.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Nick Warmerdam and his dog Diesel are inviting locals to check out the Lakeland Farm U-pick Flower Farm this spring. (Ben Lypka/Abbotsford News)
VIDEO & SLIDESHOW: Abbotsford’s Lakeland Flowers opens for spring

Tulip farm attraction opened on April 14, open to the public daily seven days a week

A man holds a child while speaking with RCMP following an erratic driving incident on Highway 1 in Chilliwack on Friday, April 16, 2021. The child and a woman (but not this man) were in this Jeep Grand Cherokee which hit a barrier and a parked car on Highway 1 and continued driving. The vehicle finally exited the highway at Yale Road West and came to a stop. (Jenna Hauck/ Chilliwack Progress)
Video captures woman driving erratically with child after hitting barrier, car on Hwy 1 in Chilliwack

Smoke seen coming from SUV as it continues to travel eastbound of shoulder of highway

Video image
UPDATE: Bridge traffic moving normally after high-velocity crash involving logging truck

Northbound crash occurred at approximately 2 p.m., involves 6 vehicles, north lanes shut down

An undated picture of the Hope Station House. (Photo/Save The Hope Station House)
Hope council must consider all options for Station House: B.C. Ombudsperson

Investigation ‘revealed flaws in District’s process,’ statement said

The West Coast Women’s Show is among numerous events held annually at Tradex in Abbotsford. (Abbotsford News file photo)
Show producers start petition against city’s call for Tradex proposals

Abbotsford site should remain as events facility, petition states

Rainbow trouts thrashing with life as they’re about to be transferred to the largest lake of their lives, even though it’s pretty small. These rainbows have a blue tinge because they matched the blue of their hatchery pen, but soon they’ll take on the green-browns of their new home at Lookout Lake. (Zoe Ducklow/News Staff)
VIDEO: B.C. lake stocked with hatchery trout to delight of a seniors fishing club

The Cherish Trout Scouts made plans to come back fishing soon

Royal Inland Hospital in Kamloops. (Dave Eagles/Kamloops This Week file photo)
RCMP intercept vehicle fleeing with infant taken from Kamloops hospital

The baby was at the hospital receiving life-saving care

Premier John Horgan receives a dose of the AstraZeneca COVID-19 vaccine at the pharmacy in James Bay Thrifty’s Foods in Victoria, B.C., on Friday, April 16, 2021. THE CANADIAN PRESS/Chad Hipolito
B.C. Premier John Horgan gets AstraZeneca shot, encourages others

27% of residents in B.C. have now been vaccinated against COVID-19

Former Pitt Meadows city councillor David Murray was convicted of sex assault, and is now being sued by the victim. (files)
Former Pitt Meadows city councillor sued for sex assault

David Murray was convicted in 2017 of sexually assaulting a teen 25 years earlier

Vancouver Police Const. Deepak Sood is under review by the Independent Investigations Office of B.C. after making comments to a harm reduction advocate Sunday, April 11. (Screen grab)
VIDEO: Vancouver officer convicted of uttering threats under watchdog review again

Const. Deepak Sood was recorded Sunday saying ‘I’ll smack you’ and ‘go back to selling drugs’ to a harm reduction advocate

Provincial health officer Dr. Bonnie Henry prepares a daily update on the coronavirus pandemic, April 21, 2020. (B.C. Government)
B.C.’s COVID-19 infection rate persists, 1,005 new cases Friday

Hospitalization up to 425, six more virus-related deaths

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

The Nautical Dog Cafe at Skaha marina is getting its patio ready in hopes Mother Nature will provide where provincial restrictions have taken away indoor dining. (Facebook)
‘A lot of instability’: B.C. restaurants in layoff limbo

As COVID-19 cases stay high, restaurants in British Columbia are closed to indoor dining

Prime Minister Justin Trudeau looks on as Deputy Prime Minister and Finance Minister Chrystia Freeland responds to a question during a news conference on Parliament Hill in Ottawa, Tuesday, Aug. 18, 2020. THE CANADIAN PRESS/Adrian Wyld
Expectations high as Trudeau Liberals get ready to unveil first pandemic budget

The Liberals will look to thread an economic needle with Monday’s budget

Most Read