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Housing starts expected to fall in 2024: CMHC

By Brad Perry Apr 4, 2024 | 12:52 PM

Housing starts are expected to decline this year before we see slight improvements in 2025 and 2026.

That is according to the latest Housing Market Outlook released by the Canada Mortgage and Housing Corporation on Thursday.

CMHC is expecting 224,485 housing starts in 2024, compared to the more than 240,000 we saw last year.

Those numbers are forecast to improve slightly in 2025 and 2026 but officials said they will not reach the record high levels of 2021.

“Interest rate increases led rapidly to declining starts of smaller structures, particularly single-detached starts,” said the outlook.

Meanwhile, despite an increase in rental housing in 2023, supply is not forecast to keep up with demand, which will likely mean higher rents and lower vacancy rates this year.

CMHC said demand will continue to be driven by renter households staying in their units due to the high costs of homeownership.

In the homeownership market, home prices are forecast to reach previous peak levels by 2025 and surpass it in the following year.

Home sales are also anticipated to increase but remain below the record levels of 2020-2021 due to affordability challenges.