Housing Starts to Slow in 2008

OTTAWA, May 15, 2008 — New home construction will begin to slow in 2008, but remain high by historical standards, according to Canada Mortgage and Housing Corporation’s (CMHC) second quarter Housing Market Outlook, Canada Edition report.

Existing home sales, as measured by the Multiple Listing Service (MLS®)1, are expected to fall by 8.5 per cent in 2008 to 475,900 units. In 2009, the trend will continue with a decrease to 465,000 units (-2.3 per cent). Despite a slowdown of MLS® sales, demand remains strong by historical standards. For 2008 and 2009, MLS®price growth will remain above inflation. Prices will reach $323,000 (+5.1 per cent) in 2008 and $333,500 (+3.3 per cent) in 2009.

The Ontario economy is expected to improve slightly during 2008 and this will help sustain housing demand across the province. New home construction activity will be moderate between now and the end of 2008. Housing starts will move up to 72,175 units in 2008 from 68,123 units last year given an increase in new condominium projects; however starts will decrease to 65,000 units in 2009. The average MLS® price in Ontario rose by 7.6 per cent in 2007. For 2008 and 2009, the increases will be more modest at 3.5 per cent and 2.4 per cent respectively.

Canada Mortgage and Housing Corporation (CMHC)
For more information, call 1-800-668-2642.
1 The term MLS® stands for Multiple Listing Service and is a registered trademark of the Canadian Real Estate Association (CREA).

Information on this release:
Kristen Scheel
Media Relations
 CMHC
T elephone: 613-748-4632