Even though B.C. has one of the country’s strongest economies, the number of new housing starts in the province is expected to remain below B.C.’s 10-year average of 27,300 units this year, according to a housing market outlook report released Wednesday morning by the Canada Mortgage and Housing Corp.
The total number of new housing starts is forecast to grow to 22,900 units this year, up from a multi-year low of 16,077 new units last year.
CMHC forecasts further strengthening in the number of new housing starts in B.C. in 2011 to 25,700 units, but that total will still below the average of 36,156 units per year between 2005 and 2008.
The CMHC said net migration into the province will be a key contributor to a stable housing market. B.C.’s population is expected to rise by 61,600 this year and a further 63,100 in 2011. Net interprovincial migration and international immigration is expected to add 24,000 new households this year and in 2011, with a third to three-quarters of new households to be in Metro Vancouver.
As a result, housing prices in B.C. are forecast to stay relatively strong in the next couple of years. The average price of a home is expected to rise 10% in Metro Vancouver this year and a further 3% in 2011 to $675,000 from $592,441 in 2009.
Average rent for a two-bedroom unit in Metro Vancouver is expected to rise 3.5% this year and a further 4% in 2011 to $1,258 per month in 2011 from $1,169 in 2009.