Saskatchewan’s housing market is expected to experience a decline in housing starts both this year and in 2016, experts from the Canada Mortgage and Housing Corporation (CMHC) said.
CMHC economists and market analysts shared to over 200 industry representatives their common view on the region’s housing market this week, blaming lower oil prices for the predicted housing starts drop and slower job growth.
“Lower oil prices will have a dampening effect on investment and economic growth. This will contribute to slower job growth and moderating net migration which, in turn, will slow housing demand," said Lai Sing Louie, regional economist for the Prairie and Territories Region.
Meanwhile in Regina, the inventory of complete and unabsorbed single-detached homes was at 160 units at the end of 2014, a 57% jump from the end of 2013.
"Moving forward, local builders will first seek to meet new home demand from their inventory of unsold units. As a result, we expect single-detached starts to total 700 units in 2015, before edging lower to 675 in 2016," said Goodson Mwale, senior market analyst for Saskatchewan.
Moreover, the increasing number of homes in the inventory and moderating economic fundamentals in Saskatoon mean multi-family starts are forecast to dip 20% to 1,560 units in 2015, after reaching a 30-year record in 2014.
A further decrease to 1,540 units can be expected for 2016, as long as there is no significant reduction in inventory.
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