Two construction workers guide one of the giant, prefabricated concrete building panels into place for the new City of Red Deer parkade and transit terminal Tuesday afternoon. The parkade is only part of a surge in construction anticipated for the coming year.
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ShareHousing set to surge
By Harley Richards - Red Deer Advocate
Published: March 03, 2010 8:06 AM
Canada’s national housing agency is predicting that this will be a big year for Red Deer home builders, with 2011 even bigger.
In its quarterly housing market outlook issued on Tuesday, Canada Mortgage and Housing Corp. forecast that there will be 700 housing starts in the city this year. That would be a nearly 41 per cent jump over building activity in 2009, which had 497 starts.
Looking further ahead to 2011, CMHC is anticipating another 18.6 per cent increase in residential construction starts — to 830.
Regine Durand, a market analyst with CMHC, said low mortgage rates and reduced competition from the resale market should spur new home sales in Red Deer.
Among Alberta’s seven largest urban centres, Red Deer ranks behind only Medicine Hat when it comes to anticipated year-over-year increases in housing starts. CMHC is projecting a 56.8 per cent spike in construction activity in the southern Alberta city this year, with Edmonton expected to rise 27.4 per cent, Grande Prairie 26.3 per cent, Calgary 20.3 per cent, the Regional Municipality of Wood Buffalo 19.5 per cent and Lethbridge just under one per cent.
CMHC is anticipating a continued strengthening of Central Alberta’s home resale market, with Multiple Listing Service sales in the region expected to number 4,100 this year, up 8.8 per cent from the 3,770 MLS deals closed in 2009. A further 4.9 per cent increase to 4,300 sales is projected in 2011.
Prices on the local resale market will also climb, said CMHC. It’s calling for a 2.9 per cent increase in the average price to $272,000 — from $264,417 in 2010 — and a 3.3 per cent improvement in 2011 to $281,000.
Durand pointed to improved affordability and low financing costs as factors expected to stimulate demand for resale homes.
Elsewhere in the province, CMHC is expecting the year-over-year increase MLS sales in 2010 to be higher than Red Deer’s in the Regional Municipality of Wood Buffalo (13.3 per cent), Calgary (10.9 per cent), Lethbridge (9.9 per cent) and Edmonton (9.7 per cent). The rise will be less in Medicine Hat (5.5 per cent) and Grande Prairie (4.5 per cent).
Durand said CMHC’s optimism for 2011 is predicated on anticipated higher levels of migration, stronger economic growth and job creation across Alberta.
CMHC’s first-quarter Housing Market Outlook predicts a 19 per cent increase in housing starts across the three Prairie provinces in 2010, followed by an 18 per cent rise in 2011.
hrichards@reddeeradvocate.com
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