Housing starts in the Calgary area this year are expected to be the highest in eight years, a federal agency says.
Lacombe, AB -- (SBWIRE) -- 09/05/2014 -- By the end of 2014, 15,600 homes of all kinds should break ground in the Calgary census metropolitan area. That’s a 24 per cent jump from the 12,584 starts last year, says Canada Mortgage and Housing Corp. The census metropolitan area includes activity in surrounding cities and towns, such as Airdrie, Cochrane and Chestermere.
This year’s forecast for the Calgary area tops all urban centres in Alberta. Next highest is the Edmonton area with 13,300 starts. For the provincial capital, this is a 10 per cent drop from 14,689 starts in 2013. CMHC’s forecast puts the Calgary area at its most starts since 2006, when 17,046 broke ground.
“Looking at 2014, we’re seeing strong employment growth, net migration is going to come down a little bit but remain elevated compared to previous years,” says Richard Cho, CMHC senior market analyst.
Multi-family housing is expected to lead the upturn in new construction of homes in the Calgary area this year. CMHC expects soil will turn on 9,000 multi-family units by the end of 2014, marking a
45 per cent difference from the 6,182 starts in 2013.
At the same time, construction starts for single-family homes are expected to rise three per cent.
There should be 6,600 new single-family home builds by the end of this year, up from 6,402 a year ago.
In 2015, construction starts on a variety of home types in the Calgary area are expected to ease to 14,400. This would be the second highest, behind the 2014 mark, since 2006.
“Economic drivers that support housing demand is expected to remain positive in 2015 but will not be as strong compared to 2014,” Cho adds.
Employment in Calgary is expected to rise 3.1 per cent in 2014 and 2.4 per cent in 2015, while net migration should reach 35,000 this year and 28,500 in 2015, says Cho.
Next year, single-family homes are slated to reach 6,400 starts and the multi-family segment is expected to see 8,000.
Despite 1,000 fewer builds than 2014, new construction of multi-family housing in the Calgary area should still out-pace all urban centres in Alberta next year, says CMHC. The Edmonton area is expected to come in second with 6,400 multi-family starts next year. But in 2015, the Calgary area is expected to lose the lead in single-family starts, with the Edmonton area slated for 6,500. Across Alberta, housing starts are expected to grow by seven per cent this year, with shovels turning out 38,600 homes. That total should recede next year, with 36,800 slated to break ground, CMHC says.
“The resale market will (become) more competitive, drawing some sales away from the new home market in 2015,” says Cho. In Alberta this year, 69,900 homes are expected to change hands on the resale market. Next year, it’s slated for a three per cent uptick to 71,900 sales.
Behind Alberta’s two biggest cities, Red Deer is forecast to see 865 starts on a variety of homes in 2014, 10 per cent more than the 784 homes a year earlier.
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