REGINA, SASKATCHEWAN - May 22, 2014 - According to Canada Mortgage and Housing Corporation's, 2014 Regina Housing Market Outlook released today, total housing starts in the Regina Census Area are forecast to decline to 2,650 units in 2014 before moderating further to 2,580 units in 2015.
Rising inventory, lower net migration, and increasing competition from Regina's resale market, will prompt local home builders to slow the pace of initiating new units this year and next. The reduction will be most pronounced among multi-family units where production reached a record high in 2013, reported by Canada Mortgage and Housing.
Single-detached starts are projected to reach 1,150 units in 2014, down from the 1,246 units initiated last year. Rising new home inventory and increasing supply in the resale market will dissuade local builders from introducing new units too quickly in 2014. Barring a significant inventory drawdown, a further reduction to 1,130 units is forecast for 2015. Despite the moderation, single-detached starts over the forecast period will remain above the preceding five-year average of 954 units.
After reaching a record high of 1,876 units in 2013, multi-family starts, which consist of semi-detached units, rows, and apartments, are forecast to moderate 20 per cent to 1,500 units in 2014 and 1,450 units in 2015. Higher rental apartment starts contributed to the strong gain in multi-family starts in 2013. Moving forward, rising inventory, higher rental vacancies, and a reduction in net migration to Regina will prompt builders to scale back production of multi-family units over the next two years.
Following a 6.6 per cent decline in 2013, sales of existing homes in Regina are forecast to increase slightly to 3,730 units in 2014. Resale demand will be supported by continued employment growth, low mortgage rates, and population gains. A further increase to 3,780 MLS® transactions is projected for 2015, buoyed by continued job growth and move-up buying.
The average MLS® price for Regina is expected to rise 2.9 per cent to $321,500 in 2014 and then to $328,500 in 2015. The gains in the average resale price will be much less than the increases experienced in the past two years. An elevated supply of active listings relative to demand combined with rising carrying costs will moderate price growth over the forecast period.
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