Canada Mortgage and Housing Corporation (CMHC), Canada’s national housing agency has just released its “First Quarter Housing Market Outlook” forecasting what will happen in real estate markets across the country through 2007.
In an article titled, “Soft Landing for Housing Starts in 2007 and 2008,” CMHC predicts that housing starts will moderate in 2007, dropping to 209,500 from 227,395 units in 2006.
I read almost every report that CMHC releases and I’m not sure why, but most of them make me nuts! Perhaps it’s because they’re always wrong! Alright, I’m being a bit of a jackass here. They’re not always wrong, but they often fail to recognize what’s really happening in a market area.
I know as well as anybody how hard it is to predict the future and I have to come clean and admit that I have fallen flat on my face, at least once. JAt the close of 2005, I predicted the following year would see a marginal drop in resale units, and more moderate price increases, “likely in the range of 4-5%.”In fact, resale unit sales increased by seven percent and prices went up close to 11%.My bad. What I didn’t see coming was a significant improvement in net migration. So, with that out of the way, here’s what CMHC has to say about housing starts in Saskatchewan for 2007 and 2008.
“In Saskatchewan, the improving net migration, as well as the strong job market and robust income growth, bode well for housing demand. Total housing starts are forecast to decline slightly from 3,715 units in 2006 to 3,600 units in both 2007 and 2008.” Huh? Anybody else confused? I can only say that I hope CMHC has missed the mark this time. The City of Saskatoon recently announced that they will attempt to prepare 2,192 lots for construction in 2007.There are hundreds of lots ready for homes in Martensville, Warman, Clavet and other communities.I’m hoping we’ll see close to 2,300 to 2,500 starts within 50 kilometers of Saskatoon. 2007 has the potential to be a great year for Saskatchewan but we must have homes to put people in.
Here’s a comment I received the other day on another post.
“Hi, I have been looking on MLS for a suitable property for myself and my family in the Saskatoon area, there is a definite shortage of property and almost none that would be large enough for us. We were hoping to move to Saskatoon from the United Kingdom in the summer of 2007, but because of the shortage of suitable property, we may be forced to look at another province entirely. This is such a shame as I know that Saskatchewan is trying to encourage people in at the moment.”
You’re right Lynn; this is such a shame.
There are 237 active resale listings on the Saskatoon MLS® system today. Half of those likely have sales pending on them. You almost can’t buy a house in this city if you wanted to.If I were a home builder I’d have no problem building spec homes as fast as I could find the manpower and the money to put them up.
Housing starts are not going to decline in Saskatchewan in 2007.I’ll meet you back here in early January for a review.
I’m always happy to answer your Saskatoon real estate questions.
Royal LePage Vidorra