CMHC’s Third Quarter Housing Market Outlook predicts that housing starts for 2009 will reach 141,900 for that year and will continue to increase into 2010, at 150,300, showing great promise for Canada’s economic future.

“Economic uncertainty and lower levels of employment tempered new housing construction in the first half of this year,” says Bob Dugan, chief economist for CMHC. “In the second half of 2009 and in 2010, we expect housing markets across Canada to strengthen.”

Hamilton, Ottawa, Kitchener and Thunder Bay are the tightest resale home markets in Ontario and as a result of this, they are expected to see a large spur in new home construction later this year.

With buyers and builders shaking off leftover anxiety about the economy and a strong national rebound for resale homes a likely thing to come, many builders are expected to heighten the number of homes they’ll start construction on in the fall.

Improving this activity on the resale market and producing lower inventory levels in both the new and existing home markets are expected to aid in this rebound, according to CMHC.

Existing home sales, as measured by the Multiple Listing Service (MLS), have rebounded strongly since January and are expected to reach 420,700 units in 2009. This spur in the housing market will remain close to that level at 419,400 units in 2010.

Some builders will do almost anything to have you sign on the line, and with some rep’s that sit in the show homes not be fully qualified to sell homes, you will want someone on your side who has your best interest in mind and fully qualified.  We at the Chamberlain Group have had extensive experience with new homes and new home builders as we were apart of a development that sold 93 brand new condos where we did marketing and sales.

We have also had clients who wanted us to sit in on all meetings with the builder and even attend the meetings for picking out their flooring, lighting, cabinets etc. But then we have had clients that just want us to help them with all the paperwork and read over what the contract says to make sure that they are fully covered, as builders & developers use their own offer sheets that are drafted by their lawyers, and in most cases cover their ASSets before yours…

Whether you use us or not, it is very important to have a third party representative who has your interest and only yours as their number one priority.

On that note…

Below is a map of all the show home location in Calgary that was used in The Calgary Herald on January 3, 2009.  If you have any questions about new homes, show homes, spec. homes etc. please contact us at sales@tcgroup.ca or 403-366-3130

Please Click On The Image To Enlarge It

If you are in the market for a new home you may want to check this out…

Calmer market ahead

In 2008, the rate of price growth should drop about 50% from last year for both new and resale homes across Canada. The return to historically normal levels will give consumer incomes a chance to catch up and buyers should feel less pressure and more opportunity to explore all the choices and financing options available to them.

“Now we’re seeing a calmer market,” said Peter Vukanovich, president of Genworth Financial Canada. “That translates into better opportunities for first-time homebuyers to make an informed decision.”

For homebuyers, this more stable growth is a welcome change from the increases in recent years. Both 2006 and 2007 saw an 8.7% increase in the price of new homes, and there has been a 10.2% average jump in the price of resale homes each year since 2002.

“Rapid price increases, which were virtually unsustainable in regions like Alberta, had begun to erode affordability and put a lot of pressure on first-time homebuyers in terms of their decision-making process,” said Vukanovich.

Housing market still strong

Overall, Canada’s housing market is expected to remain strong, supported by steady demand and modest price increases across the country. This year’s national average new home price is forecast at $397,789 (a 3.8% increase) with the 2008 average resale home price expected to reach $322,424 (a 5.1% increase). Regionally, the strongest housing demand can be found in B.C., Manitoba, Alberta, and Saskatchewan, as a result of the commodity-fuelled economic growth in the West.

National housing starts, however, are expected to ease to just below 215,000 units this year and 194,000 units in 2009. This represents a 15% drop, after eight years of steady increases. The drop in single-unit starts is expected to be greater than for multiples, reflecting the number of empty nesters looking to downsize and the affordability of these properties for first-time buyers.
Mortgage rates to drop

Mortgage rates will also see a drop this year as the lowered Bank of Canada interest rate flows through to the mortgage market. The average five-year conventional mortgage rate is expected to be 7.0% in 2008, dropping slightly to 6.7% in 2009.

For further report details, including regional numbers, download the full report.

More modest increases ahead

Canadians can look forward to more moderate price increases for new and existing homes across the country in the years ahead.

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I really want to urge you to take a long term approach to what is happening.  The Alberta, and more specifically the Calgary and area market is taking a breath.  If the market continued to climb with 30%-40% increases year over year, I would be very nervous.  But with the market taking a breath, finding a new bottom, this says to me that there will be some continued growth in the future (there are many other reasons for this as well).  Personally, I am OK with the market the way it is.  The media and paper articles talk about how the market is not doing good and Alberta “in general” is having much greater decreases in year over year prices than the rest of the country.

All in all, if you are investing in real estate, or looking to buy a home, now is a great time to find some great deals out there for purchase.  There are motivated vendors (sellers), and some great cash flowing property.  Don’t get caught up in the media hype, and get overwhelmed… STAY FOCUSED!

“There is no bubble in the Canadian housing sector,” he told reporters after speaking to roughly 400 people at a Calgary Chamber of Commerce event.

“That’s not been our concern. Our concern has been a tendency for longer amortization periods, like 40 years, and for purchasers putting very little money down. We’ve seen nothing in Canada like the U.S. subprime situation.”

He goes on to say that with the new tightening of the rules with down payments on mortgages and amortization periods, he is not fretting about the banks and the woes that are happening in the US.  He ends the article by saying… that he acknowledged that the economy is going through “turbulent times,” it still remains healthy.

“Our economy is strong,” he told the audience.

Here is the Full Article.

“Three key economic ingredients will keep Canada’s housing market on a different track from the United States. One is consumer confidence, the second is employment, and third is affordable interest rates. The Bank of Canada cut interest rates on January 22nd because of weaker prospects for Canadian economic growth in 2008. “Those lower interest rates will also help temper the erosion in housing affordability due to additional home price increases,” Bosley added. The Bank of Canada is expected to cut its trend-setting rate again in March.

CREA’s Chief Economist Gregory Klump says that the Canadian housing market in 2008 will pull back from the breakneck pace set in 2007, but this is still forecast to be the second-busiest year on record in almost all provinces, with residential unit sales reaching an estimated 512,705 units.”

I would love to hear your comments on what you think the Real Estate market in Canada will go???

Regards,

Jared Chamberlain
jared@tcgroup.ca
www.ChamberlainGroup.ca