The Canadian Mortgage and Housing Corporation (CMHC) released a Housing Market Insight report for Alberta, which included expectations for the post-wildfire reconstruction period in Fort McMurray.
Previous experience from natural disasters in Alberta suggests that most of the structures destroyed in the wildfire will be rebuilt. Fort McMurray is unlikely to be an exception,” according to Timothy Gensey, market analyst for the Prairie and Territories region. “Expect strong reconstruction activity in the new housing market as well as declining vacancy rates in the rental market in the near to medium term.”
Before the wildfires began in May, housing starts in Fort McMurray were at an all-time low. But with an estimated 10 per cent of buildings having been destroyed, “a heightened level of new construction is expected in the aftermath of the fire. The most extensive fire damage occurred in the city’s residential suburbs, so replacement will cause a sharp increase in new home construction. If all homes that were destroyed rebuilt, there could be up to 2,500 housing starts. This would be the highest number of starts on record, greater than the 2,200 starts recorded in 2007,” according to the report.
The resale market is more uncertain, as the weak economic conditions that existed before the wildfire persist. Energy investments in the area have been reduced, and residents returning to Fort McMurray aren’t sure what path job creation is going to take. Even if they want to stay in the area, residents are likely to rent while the city finds its feet again, buoying the rental market in the meantime.
This is expected to be the highest new home construction activity Fort McMurray has seen in 20 years. The resale markets could stabilize in the near term, ending a recent price and sales decline; however, it is too early to definitively predict price trends,” read the report.
Home sales in the Fort McMurray rose from 6 in May 2016 to 67 in June 2016.
There is still plenty of cleanup that needs to take place, in addition to insurance claims that need to be made, payouts for which could take many months for residents to receive. Building isn’t expected to begin in earnest until early 2017.
Related stories:
Rebuilding Fort McMurray will take coordination
Wildfires could mean insurance hikes for Alberta homeowners
CMHC not expecting large Fort McMurray losses
Previous experience from natural disasters in Alberta suggests that most of the structures destroyed in the wildfire will be rebuilt. Fort McMurray is unlikely to be an exception,” according to Timothy Gensey, market analyst for the Prairie and Territories region. “Expect strong reconstruction activity in the new housing market as well as declining vacancy rates in the rental market in the near to medium term.”
Before the wildfires began in May, housing starts in Fort McMurray were at an all-time low. But with an estimated 10 per cent of buildings having been destroyed, “a heightened level of new construction is expected in the aftermath of the fire. The most extensive fire damage occurred in the city’s residential suburbs, so replacement will cause a sharp increase in new home construction. If all homes that were destroyed rebuilt, there could be up to 2,500 housing starts. This would be the highest number of starts on record, greater than the 2,200 starts recorded in 2007,” according to the report.
The resale market is more uncertain, as the weak economic conditions that existed before the wildfire persist. Energy investments in the area have been reduced, and residents returning to Fort McMurray aren’t sure what path job creation is going to take. Even if they want to stay in the area, residents are likely to rent while the city finds its feet again, buoying the rental market in the meantime.
This is expected to be the highest new home construction activity Fort McMurray has seen in 20 years. The resale markets could stabilize in the near term, ending a recent price and sales decline; however, it is too early to definitively predict price trends,” read the report.
Home sales in the Fort McMurray rose from 6 in May 2016 to 67 in June 2016.
There is still plenty of cleanup that needs to take place, in addition to insurance claims that need to be made, payouts for which could take many months for residents to receive. Building isn’t expected to begin in earnest until early 2017.
Related stories:
Rebuilding Fort McMurray will take coordination
Wildfires could mean insurance hikes for Alberta homeowners
CMHC not expecting large Fort McMurray losses
