Province, regions and longer term outlook

Transcription

1 Province, regions and longer term outlook HOUSING OUTLOOK CONFERENCE QUÉBEC Kevin Hughes Regional Economist November 18, 214 Housing market intelligence you can count on OUTLINE Housing market intelligence you can count on I Key influences on housing markets II Housing market forecasts for III A look at longer-term trends 1

2 PART I Key influences on housing markets KEY INFLUENCES Economy Weak economic growth 4. Annual GDP Growth (%) 3. Québec Canada % (p) 215(p) 216(p) Source: Statistics Canada, : CMHC forecasts 2

3 KEY INFLUENCES will affect the job market Economy 4. Annual Employment Growth (%) 3. Québec Canada % (p) 215(p) 216(p) Source: Statistics Canada, : CMHC forecasts KEY INFLUENCES Economy Weak employment growth forecast in the various areas 5 4 Annual Employment Growth (%) Quebec CMAs 3 2 % (p) 215 (p) 216 (p) CMHC forecast -3 Québec Montréal Trois-Rivières Sherbrooke Saguenay Gatineau 3

4 KEY INFLUENCES Posted Mortgage Interest Rate Ranges (%) Economy Mortgage rates are expected to rise slightly. One-Year Five-Year CMHC forecast KEY INFLUENCES Demographics 5, Net Migration Province of Quebec Net migration will pick up starting next year. 4, 3, 2, 1, (p) 215(p) 216(p) Source: Statistics Canada, : CMHC forecasts 4

5 KEY INFLUENCES Net migration expected to rise in most areas Demographics Net Migration Quebec CMAs Montréal 29,75 35, 37,5 Québec 5,2 5,325 5,45 Gatineau 1,5 1,6 1,65 Sherbrooke 2,15 2,275 2,245 Trois-Rivières 1,1 1, 1, Saguenay : CMHC forecasts PART II Housing market forecasts for

6 Resale market Resale market in Demand will be supported by a gradual employment recovery. Small increase in transactions is anticipated. Growth in prices will be modest. Resale market Gradual rise in transactions 85, 8, Centris Sales Province of Quebec 75, 7, 7, 65, 65, (P) 215(P) 216(P) Source: QFREB by the Centris system : CMHC forecasts 6

7 Resale market will be observed in most areas (p) 215(p) 216(p) Centris Sales Annual per cent change (%) - Quebec CMAs -15 Québec Montréal Gatineau Sherbrooke Trois-Rivières Saguenay Source: QFREB by the Centris system : CMHC forecasts Resale market Price growth will be modest Change (%) in Average Centris Price Province of Quebec Active Listings Sales Source: QFREB by the Centris system : CMHC forecasts (P) 215(P) 216(P) 7

8 Resale market Small price increases expected in the various areas Change in Price (%) Average Price in 216 ($) Québec , Trois-Rivières ,5 Sherbrooke , Montréal , Gatineau , Saguenay , : CMHC forecasts Resale market The condominium market will favour buyers over the next two years. 8

9 New home market New home market in Starts of new multi-unit housing will remain stable. Single-detached home starts will rebound. There will be some regional differences. New home market Still in an absorption phase, multi-unit housing will see starts remain stable. 35, 3, 25, 2, 15, 1, 5, Multi-Unit Housing Starts Province of Quebec (p) 215(p) 216(p) Source: CMHC : CMHC forecasts 9

10 New home market Decreases anticipated in the different areas Source: CMHC : CMHC forecasts Multi-Unit Housing Starts Annual per cent change (%)- Quebec CMAs 214(p) 215(p) 216(p) Montréal Québec Gatineau Sherbrooke Trois-Rivières Saguenay New home market 2, Single-Detached Home Starts Province of Quebec Single-detached home starts will rebound slightly. 15, 1, 5, (p) 215(p) 216(p) Source: CMHC f: CMHC forecasts 1

11 New home market Decline to continue in certain areas Single-Detached Home Starts Annual per cent change (%) - Quebec CMAs 214(p) 215(p) 216(p) Montréal Québec Gatineau Sherbrooke Trois-Rivières Saguenay Source: CMHC : CMHC forecasts Rental market Rental market in Market situation and dynamics will vary among the different areas. Market conditions will continue to ease in certain areas. 11

12 Rental market % 8 Montréal 7 % Québec V a c a n c y % Gatineau % Sherbrooke Following a period of market easing R a t e s % Trois-Rivières % Saguenay CANADA 1 MORTGAGE AND HOUSING CORPORATION Source: CMHC Rental market vacancy rates will remain stable in the CMAs : CMHC forecasts Montréal Québec Saguenay Gatineau Sherbrooke Trois-Rivières Vacancy Rate Ranges (%) 215 and 216 Between 2.5 and 3.3 Between 4.7 and

13 Risks Risks to the forecast for Slower-than-expected global (U.S.) economic recovery Absence of resale market recovery Easing of rental market PART III Review of longer-term trends 13

14 TRENDS Summary Renovation market will stay on an upward trend. Population growth will be stronger in urban areas. Growth in the population aged 75 or older will soon accelerate. TRENDS Renovation market Investment in renovations exceeds investment in construction New housing, all types Housing Sector Investments Province of Quebec Renovations Source: Statistics Canada 14

15 TRENDS Renovation market Renovation market will stay on a upward trend and be fuelled by: the upward trend in home resales, the aging housing stock the changing household needs (related to population aging). TRENDS Demographics Population Growth (%) ( ) Total CMAs 2.6 Population growth will be stronger in urban areas. Gatineau 26.6 Montréal 22.4 Sherbrooke 17.8 Québec 16. Trois-Rivières 1.2 Saguenay 2.1 Forecasts: Institut de la statistique du Québec Outside CMAs

16 TRENDS Demographics Average Annual Household Formation Province of Quebec Slowdown in household formation rate is imminent. 211 to 216 4, 216 to , Forecasts: Institut de la statistique du Québec TRENDS Demographics Growth in the population aged 75 or older is about to accelerate. Thousands Growth in Population Aged 75 or Older Province of Quebec Projections : Institut de la statistique du Québec 16

17 TRENDS Demographics Assuming that capture rates will remain near recent levels supply will soon start growing at a faster pace. Private Retirement Home Spaces (annual potential demand ranges) Current (214) 1, ,5 5, , 6, , 7, , 7,5 Projections: Institut de la statistique du Québec, CMHC calculations based on current population forecasts and capture rates Recap The key influences will moderately sustain housing demand. The markets in : Gradual recovery of resales, Housing starts remain stable. The longer term trends will soon fuel market activity. 17

18 Information Kevin Hughes Regional economist (514) Follow CMHC on Highlights Key influences on housing markets Weak economic growth will affect the job market. Weak employment growth is also forecast in the various areas. Net migration will pick up starting next year. These trends will be observed at the regional level. Interest rates will remain unchanged until late 215 and will then start rising gradually. Market forecasts for Demand will be supported by a gradual employment recovery. A small increase in transactions is anticipated on the resale market. The growth in prices will be modest. These movements will be observed in most areas. The condominium market will favour buyers over the next two years. The absorption of new multi-unit housing will continue. Single-detached home starts will rebound. There will be some regional differences with regard to construction. The rental market situation and dynamics will vary among the different areas. Rental market conditions will continue to ease in certain areas. 18

19 Highlights Review of longer-term trends The renovation market will stay on an upward trend. Population growth will continue to be concentrated in urban areas. The growth in the population aged 75 or older will pick up the pace. The information, analyses and opinions contained in this document are based on various sources believed to be reliable, but their accuracy cannot be guaranteed. The information, analyses and opinions shall not be taken as representations for which Canada Mortgage and Housing Corporation or any of its employees shall incur responsibility. 214, Canada Mortgage and Housing Corporation.All rights reserved. CMHC grants reasonable rights of use of this document s content solely for personal, corporate or public policy research, and educational purposes. This permission consists of the right to use the content for general reference purposes in written analyses and in the reporting of results, conclusions and forecasts, including the citation of limited amounts of supporting data extracted from this document. CMHC retains the right to request that such use be discontinued for any reason. No use whatsoever can be made of the name, logo or other official marks of CMHC without the prior written consent of CMHC. The use, reproduction or broadcast of the document itself, in whole or in part, in its physical, electronic or any other form, is prohibited. Subject to the preceding conditions, any use, reproduction or transmission of the content of a CMHC document must include the source of the information, including statistical data, acknowledged as follows: Source: CMHC (or Adapted from CMHC, if appropriate), name and date of document. 19