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CMHC's Housing Outlook

We were invited to CMHC's PEI Housing Outlook Seminar 2014 and are happy to provide you with some snippits of information from the session:
  • expect mortgage interest rates to remain mainly flat with some minor increases over the next year
  • the stock market seems to be indicating a strong year
  • employment outlook for PEI relatively stable up 1%
  • full time employment growth was reported to be up 5.3% in Charlottetown in 2013
  • trend in new housing starts is declining
  • vacancy rates in Charlottetown continue to rise over last year
  • we should see a moderate pullback in multiple starts over the next few years
  • multiple starts in Charlottetown in 2013 were 278.  Expected to be 190 & 155 in 2014 & 2015 respectively
  • supply of new apartments exceeding demand and will likely cause further increase in vacancy rates 2014 & 2015
  • vacancy rate of 2 bdrm in Charlottetown was 8.8% in 2013
  • resale sales in PEI will remain relatively stable & trend improving over last year
  • employment growth in Canada was 1.3% in 2013 and expected to be 1.5% in 2014 & 1.8% in 2015
  • most of the people leaving PEI for Alberta are under 24 years old
  • average earnings remain flat but house prices have increased 5.9% from 2004-2013 due to homeowner "wants" in new construction rather than increased cost of material/labour
  • actual increase in cost of new homes would be 1.26% but due to increased wants for higher end finish products (marble countertops, whirlpool tubs etc) it is actually 4.6%
  • many First Time Buyers are now considering semi-detached housing
  • Single family home starts declined in 2013
  • the market for spec building has declined with some inventory still sitting unsold
  • average new home price in 2013 was $286,000
  • average home price in 2003 was $123,000 & average home price in 2013 was $203,000
  • 40% of sales in PEI are for houses less than $150,000
  • less than 10% of sales are for homes greater than $300,000.  Lots of supply in this market...which will likely lead to some price reduction
  • Average time on the market for a home to sell is now roughly at 120 days
  • PEI is officially in a BUYER's Market!
Happy house hunting to our First Time Buyer Clients!!  Rates are still amazingly low, home prices are affordable and there is good supply on the market.  If you would like guidance through the process of your First Home purchase contact us and we will walk you through it!
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