Posts Tagged ‘quebec city’

RENTAL MARKET REPORT

Comments: 0January 4th, 2010 by admin

Posted by Moshe Alexander

The overall vacancy rate in Halifax stood at 2.9 per cent in October, down from 3.4 per cent last fall. Vacancy rates in the Halifax Regional Municipality (HRM) trended down in all submarkets but one in 2009. Average rents, based on structures common to both the 2008 and 2009 surveys, were up 2.8 per cent. In the HRM, Halifax City saw the largest decline in vacancies as the rate fell from 2.7 to 2.0 per cent in 2009. The Mainland North area of Halifax City saw the vacancy rate fall a full percentage point to 1.6 per cent. This submarket has a significant impact on the overall HRM vacancy rate as it is home to 28 per cent of the rental stock – the most of any submarket. On the other side of the harbor, Dartmouth City saw a more modest decline in vacancies from a rate of 5.5 to 5.2 per cent in 2009. Dartmouth North again saw the highest vacancy rate in the HRM at 5.6 per cent in 2009 while Dartmouth East recorded the only increase in vacancies – climbing from 4.4 to 5.4 per cent. The Metro Halifax vacancy rate of 2.9 per cent is only slightly higher than the national average of 2.8 per cent. Apart from Windsor, Halifax saw the largest decline in vacancies in 2009

with a 0.5 percentage point decrease. Canadian cities with the lowest vacancy rates in 2009 were Quebec City, Regina and St. John’s with rates of 0.6, 0.6 and 0.9 per cent respectively. Three of the cities with the highest vacancy rates, Calgary, Peterborough and Abbotsford also saw the largest increases in 2009 as vacancies climbed more than three percentage points in each of these major centres. Vacancy rates have remained relatively stable in Halifax for the past decade. In fact, the 2009 vacancy rate of 2.9 is only slightly below the ten-year average vacancy rate of 3.0 per cent. The vacancy rate has not fluctuated much over that time period, in spite of significant levels of new construction and new rental units being added to the supply. Over the past ten years, there have been approximately 585 new rental units added to the supply each year. Currently, there are nearly 600 more rental units under construction (as of October 2009) in the HRM most of which will be completed over the next 12 to 18 months. It is expected that current demand will be sufficient to offset the additional supply and keep vacancy rates within the recent ten-year range. Average rents in Halifax, increased by 2.8 per cent in 2009 compared to 2.0 per cent growth in both 2007 and 2008. This percentage increase is based on a fixed sample methodology including structures common to both this year’s and last year’s survey. Rents increased in response to the elevated demand that pushed vacancy rates downward. Based solely on this year’s sample, the average rent for a two- bedroom unit in Halifax was $877 in 2009. * The survey, completed during the first two weeks of October, is limited to privately initiated structures comprised of at least three rental units that were available for rent or completed before June 30, 2009.

Demand for two-bedroom units increased the most in Halifax in 2009. Two-bedroom units account for nearly 50 per cent of the rental stock in the city and saw the largest decline in vacancy rates from 4.2 to 3.3 per cent in 2009. The decrease in two-bedroom vacancies was largely impacted by the halving of the vacancy rate in Mainland North from 3.0 to 1.5 per cent. One and three-bedroom units saw more moderate vacancy rate declines from 2.8 to 2.4 per cent and from 2.9 to 2.7 per cent respectively. Bachelor units were the only bedroom-type to see an increase in the vacancy rate from 2.1 to 2.5 per cent in 2009. The vacancy rate in the south end of the Peninsula remained unchanged at 1.3 per cent with this area continuing to report the lowest rate in the HRM. Dartmouth North saw its vacancy rate decline from 6.1 to 5.6 per cent in 2009, but retained its 2008 position as having the highest vacancy rate in Halifax.

In terms of age, newer buildings continue to record the lowest vacancy rates, albeit slightly higher than last year. In buildings built since 2000, the vacancy rate increased from 0.8 to 1.0 per cent. This rate is less than half the rate of buildings built prior to 2000. Buildings built prior to 1974 saw the largest decline in vacancy rates of 1.3 percentage points. The oldest buildings (i.e., those built prior to 1960) saw vacancies decline from 4.5 to 3.2 per cent while the next oldest group (i.e., those built between 1960 and 1974) saw vacancies decline from 5.7 to 4.4 per cent. Based on building size, larger buildings continued to record the lowest vacancy rates in the city. Buildings with more than 100 units saw vacancies decline from 2.6 to 2.1 per cent. Smaller buildings with six to 19 units saw the highest vacancy rate of 3.8 per cent in 2009, but also the largest decline from 4.8 per cent in 2008.

The overall average rent increased 2.8 per cent in 2009 based on units common to both the 2008 and 2009 surveys. Three-bedroom units saw the largest increase of 3.1 per cent, while one-bedroom units saw the lowest increase in average rents of 2.6 per cent. Just as in 2008, the average rent increases for two- bedroom units matched the overall HRM increase of 2.8 per cent. In terms of submarkets, Peninsula South saw the most growth in average rents at 4.2 per cent while Dartmouth North saw the lowest increase in average rents of 1.9 per cent. Based solely on the 2009 survey data, the average rent for a two-bedroom apartment in Halifax was $877 per month as of October. Peninsula South remains the highest priced market in the HRM with an average two- bedroom unit renting for $1,318 per month which is 50 per cent higher than the overall HRM average. All other submarkets saw rents below the overall average except for Peninsula North which is just one per cent above the average. The lowest average rents can be found in Dartmouth South and Mainland South where two-bedroom units rent for $683 and $728 per month respectively. Newer buildings continue to

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Posted in CMHC, Canada, affordable housing, moishe alexander

Moishe Alexander’s review of the Quebec CMA Rental Market and CMHC Outlook Report fall 2008

Comments: 0February 18th, 2009 by admin

February 8, 2009 – Moishe Alexander’s review on how the current world economy and Canadian economic turndown is affecting the Quebec CMA Rental Market

Moishe Alexander’s Review

Highlights

Quebec City - Credit David Paul Ohmer, Flickr

Quebec City - Credit David Paul Ohmer, Flickr

Moishe Alexander says that the rental market tightened again this year in the Québec census metropolitan area (CMA). In fact, the vacancy rate fell from 1.2 per cent in October 2007 to 0.6 per cent in October 2008. Supply grew much less significantly as, this year, the area saw the addition of 467 units to the privately initiated rental housing stock, compared to 684 in 2007 and 771 in 2006. Zone 81 (Charny, Saint-Romuald, Saint-Jean-Chrysostome, etc.) still had the lowest vacancy rate, at 0.2 per cent.

Notice to readers

Starting this year, rental apartment structures serving senior clients exclusively will be excluded from the survey. For more information, see the Technical Notes section at the end of the report.

Rental market tightens in the Québec area

Moishe Alexander says that according to the results of the Rental Market Survey conducted by CMHC in October, the vacancy rate decreased in 2008, in the Québec census metropolitan area (CMA). From 1.2 per cent in 2007, the vacancy rate has now fallen to 0.6 per cent. In concrete terms, this means that, out of a stock of 70,740 rental housing units2, 433 apartments were vacant this past October. The limited rise in rental housing supply and a strong demand fuelled by the growth of the job market and the increase in net migration account for these results. Diverging trends were noted in Quebec’s six CMAs. While rental market conditions eased in the Sherbrooke and Trois-Rivières CMAs, the Gatineau, Montréal, Québec and Saguenay areas registered decreases in their respective vacancy rates. This fall, the Québec CMA had the lowest vacancy rate (0.6 per cent), followed by Saguenay (1.6 per cent), Trois- Rivières (1.7 per cent), Gatineau (1.9 per cent), Montréal (2.4 per cent) and Sherbrooke (2.8 per cent).

Strong demand

Moishe Alexander says that while the market had eased somewhat between 2002 and 2006, conditions have since been tending to tighten. The Québec area has been enjoying greater economic growth than the other CMAs, with a 3.1 per-cent increase in its gross domestic product in 2007. This is confirmed by the sustained job creation in 2007 (+9,100) and 20083 (+6,400). Investments in infrastructure and the activities for Québec City’s 400th anniversary effectively stimulated the labour market. In 2008, the non-residential construction has benefited from these conditions with strong gains in employment and hours worked across the area. During the first nine months of the year, 8,100 jobs were created in this sector: accommodation and food services; professional, scientific and technical services; finance, insurance and real estate; as well as transportation and communication. For the first nine months of the year, total employment growth reached 1.7 per cent in the CMA, and the increase extended to both full-time and part-time jobs. However, the rise in demand was not supported by the labour market situation for young people aged from 15 to 24 years, since the employment level was down for the first three quarters of 2008, compared to the same period in 2007. The greater demand was rather due to the increase in migration, fuelled by the good economic performance of the area. In fact, net migration in the CMA reached 4,170 people in 2006 and, even though the figures are not yet known, it is expected that the levels will again be high in 2007 and 2008. Newcomers from other regions across Quebec accounted for the greatest share (62 per cent). This strong migration to the CMA has been significantly boosting demand for rental housing.

Limited rise in rental housing supply

Moishe Alexander says the growth in supply weakened this year. In fact, the increase in the number of rental dwellings in privately initiated buildings reached 467 units in 2008, compared to 684 in 2007 and 771 in 2006.

Vacancy rates fall in most sectors of the CMA

Moishe Alexander says that vacancy rates fell in seven of the nine zones in the area. The rental market remained very tight on the South Shore (zones 8 and 9) and, even though conditions remained practically stable there in 2008, this sector still had the lowest vacancy rate in the CMA, at 0.2 per cent (zone 8). The vacancy rate in zone 9 (Lévis, Pintendre, Saint-Joseph-de- Lévis and Beaumont) eased very slightly in 2008, reaching 0.4 per cent, compared to 0.3 per cent in 2007. The greatest vacancy rate decrease was observed in zone 5 (Val-Bélair, Saint-Émile, Loretteville, etc.), where this rate fell from 1.7 per cent in 2007 to 0.4 per cent in 2008. The presence of the Valcartier military base and the development of Technopole Defence and Security has certainly accounted for the strong housing demand in this sector.

Vacancy rates on the decline in newer structures

Moishe Alexander says in the area, the sustained demand contributed to pushing down the vacancy rate for newer buildings. In 2007, structures built in 2000 or later had higher vacancy rates than older buildings, on account of their higher rents. This was no longer the case in 2008, as the vacancy rate for newer structures was 0.6 per cent. This year, structures built before 1960 had the highest vacancy rate, at 0.9 per cent. Overall, however, the vacancy rate was higher (1 per cent) for units renting for $1,000 or more per month. The strong demand for rental housing also led to a tighter market for smaller apartments, for which conditions are usually less tight. The vacancy rates for bachelor units and one-bedroom apartments fell in 2008, reaching 1.6 per cent and 0.9 per cent, respectively.

Estimated change in average rents

Moishe Alexander says in the CMA, the average rent for two-bedroom apartments rose by 2 per cent between the October 2007 and October 2008 surveys. The increase was below the rate of inflation observed over the same period for Quebec overall (2.3 per cent). It should be noted that CMHC now uses a measure (introduced in 2006) that estimates the change in rents charged in existing structures. This measure therefore excludes the impact of new structures and conversions added to the universe between surveys. In October 2008, the average rent for two-bedroom apartments reached $653 per month. The Québec CMA had the third highest average rent for units of this type, behind Gatineau ($677) and Montréal ($659). In the area, the highest average rent for two-bedroom apartments was observed in the Québec Haute-Ville sector, at $861 per month, while the Beauport sector had the lowest average rent for units of this type, at $587 per month for the period.

Availability rate

Moishe Alexander says the availability rate differs from the vacancy rate in that it includes not only the vacant units but also the units for which the existing tenant has given, or has received, notice to move, and for which a new tenant has not signed a lease. This rate reached 1.2 per cent in October 2008. The highest availability rates were recorded in the Québec Haute-Ville (1.9 per cent) and Basse- Ville (1.8 per cent) sectors and in the zone comprising Beauport, Sainte-Brigitte-de-Laval, Boischatel, L’Ange-Gardien, Château-Richer and L’Île-d’Orléans (1.8 per cent). The lowest availability rate was noted on the South Shore in the sector including Charny, Saint-Romuald and Saint-Jean-Chrysostome (0.2 per cent). These figures show that a small number of units would be vacated in the short term, which also reflects the lease cycle in Quebec, as most are signed for one year and renewed on July 1st.

Rental affordability indicator

Moishe Alexander says the rental affordability indicator is a gauge of how affordable a rental market is for those households which rent within that market. The new rental affordability indicator examines a three-year moving average of median income of renter households and compares it to the median rent for a two-bedroom apartment in the centre in which they live. More specifically, the level of income required for a household to rent a median priced two-bedroom apartment, using 30 per cent of its income4, is calculated. The three-year moving average of median income of households in a centre is then divided by this required income. The resulting number is then multiplied by 100 to form the indicator. An indicator value of 100 indicates that 30 per cent of the median income of renter households is necessary to rent a two-bedroom apartment going at the median rental rate. A value above 100 indicates that less than 30 per cent of the median income is required. In general, as the indicator increases, the market becomes more affordable; as the indicator declines, the market becomes less affordable. According to this indicator, the Québec CMA rental market became more affordable this year than in 2007. In fact, the indicator rose from 126 in 2007 to 135 in 2008. This means that the median income of renter households in the CMA was 35 per cent greater than the minimum required5 to pay the median rent. In 2008, the increase in the median income of renter households (+9 per cent) was greater than the rise in the median rent (+2 per cent).

Market to remain tight

Moishe Alexander says the last time the rental market was relatively less tight dates back to 1998, when the vacancy rate stood at 3.3 per cent. The beginning of the current decade was marked by rates reaching 0.3 per cent and 0.5 per cent. From 2002 to 2006, the market eased but, in 2007, the vacancy rate started another downward trend, reaching 0.6 per cent this past October. The situation will persist in 2009, as traditional rental housing construction has been idling, with volumes remaining well below the levels recorded in the last five years. In addition, the strong migration to the CMA has contributed to maintaining demand for dwellings of this type. Finally, despite favourable mortgage rates, there should be fewer renter households accessing homeownership, as a result of the economic slowdown and the less significant formation of young households in the area.

Secondary Rental Market Survey

Moishe Alexander says for the last two years, CMHC has expanded the Rental Market Survey to include information on rental condominium apartments in the following centres: Vancouver, Calgary, Edmonton, Toronto, Ottawa, Montréal and Québec. In the Québec CMA, the condominium apartment stock comprised 19,092 units in October 2008, compared to 18,526 units at the same time in 2007. The North Centre sector (zones 1 to 4) accounts for most (68 per cent) of these units. In the overall CMA, 8.4 per cent of the condominiums were rental dwellings (1,604 units) in October 2008, for a decrease from October 2007, when there were 1,701 rental condominiums, or 9.2 per cent of the condominium stock. This proportion was smaller on the South Shore, at 6.8 per cent in 2008, compared to 8.6 per cent a year earlier. The vacancy rate in the rental condominium segment followed the same trend as the rate on the traditional rental market. In fact, market conditions tightened, as the overall rental condominium vacancy rate fell to 1.3 per cent in October 2008, compared to 2.4 per cent in October 2007. The vacancy rates for rental condominiums differed from one sector to another in the area. In fact, the rates were 1.7 per cent in the North Centre and 0.6 per cent in the Northern Suburbs, while no rental condominium units were vacant on the South Shore. These results reflect the situation on the overall rental market in the area.

You can find the entire report in PDF format through the following link:
http://www.cmhc-schl.gc.ca/odpub/esub/64427/64427_2008_A01.pdf

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Posted in Alberta, British Columbia, CMHC, Housing Market, Manitoba, Newfoundland, Ontario, Quebec, Rental Market, Uncategorized

Moishe Alexander’s review of the Quebec CMA Housing Market and CMHC Outlook Report fall 2008

Comments: 0February 18th, 2009 by admin

February 8, 2009 – Moishe Alexander’s review on how the current world economy and Canadian economic turndown is affecting Quebec CMA Housing Market

Moishe Alexander’s Review

Economic and demographic: changes on the horizon

Quebec City, Quebec - Credit Zingaro, Flickr

Quebec City, Quebec - Credit Zingaro, Flickr

Moishe Alexander says in 2007 and 2008, the Québec census metropolitan area (CMA) has stood out with a pace of economic growth above the rates recorded in other cities across Quebec. This performance is related to the investments in infrastructure and the city’s 400th anniversary activities. However, the regional economy will moderate; in fact, this has already started to be felt. This year, the tourism industry is benefiting from the record number of visitors to the multiple events held for the 400th anniversary of the city of Québec. The popularity of these activities is reflected in the tourism indicators: for July 2008, the number of people who contacted the Quebec tourist information centre rose by 37 per cent over the same month in 2007, and the accommodation indicators also show an increase (+13.2 per cent). In 2009, tourism will be less significant, which will reduce the economic spin-offs for the area. In 2008, the major investments in infrastructure helped generate growth in the job market. The nonresidential construction sector benefited from these favourable conditions with a strong increase in the number of jobs and hours worked in the area overall. During the first nine months of the year, 8,100 jobs were created in this sector. Several projects were completed, including the modernization of the Jean-Lesage Airport, the creation of the Espace 400e area, the construction of the Lévis Convention Centre and the Sheraton Hotel, the redevelopment of the Promenade Samuel-De Champlain and various sites of the Québec Port, the construction of several office buildings and the completion of road and municipal infrastructure projects. While activity will slow down in 2009, this sector will still benefit from investments in road, institutional and commercial infrastructure, such as the modernization of the sports facilities at the Université Laval (PEPS) and the repairs to the Charles-de-Koninck university pavilion, the pursuit of the modernization work at Robe Giffard Hospital, and the continuation of several commercial real estate projects. Residential construction also significantly contributed to job creation, as sustained activity continued in 2008. However, a setback is anticipated in this sector for 2009, on account of a downturn in the housing markets. The overall service sector is showing signs of stagnation in 2008, as the number of jobs fell by 0.1 per cent for the first nine months of the year. In fact, employment is down in wholesale and retail trade (-11.6 per cent), as well as health care (-8 per cent) and business services (-24 per cent), but on the rise in accommodation and food services (+6 per cent), professional, scientific and technical services (+28 per cent), finance, insurance and real estate (+10.5 per cent) and transport and communications (+16.2 per cent). The other service industries show relatively stable results. The gains in professional, scientific and technical services can be explained by the good economic performance in the area, the different infrastructure projects that stimulated job creation in the field of engineering and the regional strategies to develop industries and research centres related to applied technology and life sciences. Over the coming years, this sector will continue to be supported by the economic development efforts and strategies adopted by different stakeholders in the area. The finance, insurance and real estate sector also benefited from a favourable economic environment in 2008. In 2009, this sector will remain strategic for the area, given the presence of the 11 insurance company head offices. Public and parapublic services account for nearly one in three jobs in the area. The plan to reduce the size of the Quebec government will support a decrease in employment in the public service, but health and education needs, in line with political priorities, will bring about an increase in jobs for these services over the next few years. On the decline since 2007, the manufacturing sector is facing uncertain conditions and will be affected by the anticipated slowdown. In 2008, job creation in the CMA will be somewhat more modest than in 2007, with a gain between 1.2 per cent and 1.6 per cent, compared to 2.4 per cent in 2007. In 2009, job creation will continue, at a rate between 0.6 per cent and 1 per cent. The unemployment rate, which stands below the provincial average, should remain at around 5 per cent in 2008 and then rise slightly in 2009, as a result of more moderate employment growth. On the demographic front, the results are expected to show a small decrease, as the more modest growth in the job market should drive down net migration from 4,500 people in 2007 to 4,000 in 2008 and then to 3,800 in 2009. It is likely that the anticipated slowdown in the construction sector will cause an increase in emigration to areas where major projects are planned or petroleum development is under way. Household formation, for its part, will slow down among young people over the coming years but pick up in the group aged from 65 to 74 years. The number of people aged 75 years or older should also grow less rapidly. These demographic changes in the CMA will have impacts on the housing market and, more specifically, on demand and tenure. In fact, demand will be less significant in the single-detached home segment but will rise for condominiums, as they represent an interesting alternative for households wanting to lighten the burden of maintaining a house.

Mortgage rates

Moishe Alexander says mortgage rates are expected to be relatively stable throughout the last quarter of this year, remaining within 25-50 basis points of their current levels. Posted mortgage rates will decrease slightly in the first half of 2009 as the cost of credit to financial institutions eases. Rising bond yields, however, will nudge mortgage rates marginally higher in the latter half 2009. For the last quarter of 2008 and in 2009, the one-year posted mortgage rate will be in the 6.00-6.75 per cent range, while three- and five-year posted mortgage rates are forecast to be in the 6.50-7.25 per cent range.

Resale market to ease

Moishe Alexnader says sales recorded through the Service inter-agencies / Multiple Listing Service (S.I.A. / MLS)® reached a peak in 2007, with just over 8,100 transactions, for an increase of 6 per cent over 2006. The transactions volume will again be high in 2008, but the market will stabilize, with a small gain of 1 per cent. In 2008, new listings have risen, but the steady demand is still giving sellers more of an edge during negotiations. The growth in prices remains above inflation, as the average price has now reached $194,950, up by 10 per cent over 2007. The solid economic performance, the healthy job market and favourable mortgage lending conditions have contributed to maintaining a strong demand. The price level remains higher in the centre of the CMA, as the average price for single-detached houses in this sector is about $60,000 greater than the averages noted on the South Shore and North Shore (third quarter of 2008). In 2009, the increase in the number of households aged from 65 to 74 years will support a new rise in listings, since some of these households will turn to the condominium market. In addition, the decline in the formation of young households over the coming years will ease pressures on demand for starter homes. The economic slowdown will also drive down demand, but the price level will favour the existing home market, as prices are lower on this market than on the new home market. The price increases will therefore still be above inflation but will be less significant (+5 per cent) than in 2008, as the average price will reach $204,700 in 2009. It is expected that sellers will lose some of their bargaining power. Certain market segments will still remain tight, though, such as the semi-detached home segment, where prices are more affordable. For the first six months of 2008, the average selling price of semi-detached houses attained $166,500, or $43,000 less than the selling price of single-detached homes. The average time to sell is in fact shorter for semi-detached homes (53 days) than for single-detached houses (72 days), and this trend will continue. The condominium segment is not as tight, although sellers still have a slight edge. In fact, in the second quarter of 2008, the seller-to-buyer ratio was 5.6 to 1, versus 6.3 to 1 for the same period in 2007. In 2008, the new home market is following the same trend, as condominium starts are up significantly (+62 per cent). For 2009, it is expected that condominiums will again be in demand: first, their affordability is a definite asset in a context of sustained price hikes and, second, the greater number of households aged from 65 to 74 years will fuel demand for homes of this type.

Housing starts to fall in 2009

Moishe Alexander says after reaching a peak in 2004, housing starts fell in 2005 and 2006. In 2007, a small increase was observed on account of the rise in the supply of retirement housing. In 2008, starts of this type will set a new record, with the construction of close to 950 units. Likewise, the supply of new condominiums will also grow significantly (+62 per cent). These two gains will drive up the overall housing supply, bringing total starts to 5,430 units (+3 per cent) this year. In 2008, the decrease in singledetached home starts will reach 10 per cent, as rising prices and municipal intensification efforts are rather favouring semi-detached houses. In fact, this phenomenon has now been observed for several years in the CMA. In 2009, the economic slowdown, along with the formation of fewer young households and a growing supply of existing homes, will weaken demand for new singledetached houses. These factors, combined with the higher prices on the new home market, will cause starts to fall by 15 per cent in 2009. With the lower demand, prices will rise less significantly (+5 per cent). Semi-detached houses (multiplefamily housing segment), however, will remain popular among consumers, on account of their relative affordability, so starts should remain at the same level as in 2008. Starts of multiple-family (semidetached, row, condominium and rental) housing will be on the rise in 2008 but will decline markedly in 2009. This situation will be due to the decrease in demand for rental housing for seniors. In fact, not only did starts of this type set records in 2007 and 2008, but fewer people will be turning 75 years old in the near future, which will curb demand for retirement housing. This is evidenced by sharply rising inventories and a major increase in the short-term supply in August 2008. In addition, the vacancy rate is expected to climb in 2009. Condominium starts will be numerous in 2008 and again in 2009. Dwellings of this type are popular thanks to their affordable prices and to the changes in the demographic profile in the CMA. The formation of more households aged from 65 to 74 years and the appeal of this housing type, even among first-time home buyers, will keep demand strong, and condominium starts will reach close to 1,100 units in 2009. This result represents a decrease of 10 per cent from the level recorded in 2008 but corresponds to the average for the last five years. The traditional rental market is running out steam in 2008, and only small projects with 20 units or less are being added to the existing housing stock. High construction costs are limiting the development of the rental market, which remains the most affordable housing market segment. In 2009, starts should remain below the average for the last five years. Demand in this segment is coming mainly from newcomers to the area, as household formation among people aged less than 35 years will be slightly negative in 2008 and 2009.

Rental market: no easing in the short term

Moishe Alexander says the last time the traditional rental housing market was relatively softer dates back to 1998, when the vacancy rate stood at 3.3 per cent. At the beginning of the current decade, the rates reached levels of 0.3 per cent and 0.5 per cent. Since then, the market has eased somewhat, but the vacancy rates remain very low. This situation will persist in 2008 and 2009, as rental-housing construction is idling and remains well below the volumes observed over the last five years. The vacancy rate will stay at 1.2 per cent in 2008 and 2009, given that net migration will remain at high levels (4,000 and 3,800 people, respectively) and that fewer renter households will be accessing homeownership as a result of the economic slowdown. The average rent for two-bedroom apartments will rise by 2 per cent in 2008 and by 1.5 per cent in 2009, on account of changes in energy costs.

You can find the entire report in PDF format through the following link:
http://www.cmhc-schl.gc.ca/odpub/esub/64279/64279_2008_B02.pdf

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Posted in Alberta, British Columbia, CMHC, Housing Market, Manitoba, Newfoundland, Ontario, Quebec, Rental Market, Uncategorized