Ontario housing market to cool in 2008
By Krystle Chow - Ottawa Business Journal
The Ontario real estate market will continue to slow in 2008, leading to tighter rental markets across the province, although activity will remain above historical averages, according to a new report.
In its first quarter Housing Market Outlook, Canada Mortgage and Housing Corp. noted that slower job creation and economic growth in Ontario suggests that many more people would be moving out west. Resale volumes are expected to fall to 187,000 units this year and 177,000 units in 2008, although the number of listings is expected to grow.
Home prices in the resale real estate market are forecasted to rise 3.2% this year and 1.4% in 2008.
Meanwhile, housing starts in the province are expected to fall to 67,000 units in 2007 and 63,000 in 2008 from more than 70,000 in 2006, although the continued strength of multi-family housing starts will offset the weakness in the single-detached real estate market.
“Ontario’s real estate market is at a mature phase of the housing cycle due largely to less stimulative economic and demographic conditions,” said CMHC’s Ontario regional economics Ted Tsiakopoulos in a statement. “On the economic front, while consumer spending remains strong, big-ticket purchases have slowed thanks to slightly higher interest rates and less job creation in high-paying employment sectors.”
Mr. Tsiakopoulos added that the boom in the west has pulled people away from Ontario and led to slower population growth and housing demand.
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