Continued Growth in St. John's Housing Market

ST. JOHN'S, May 19 /CNW/ - 

    Resilient consumer spending, large capital projects and employment growth will continue to support the St. John's region housing market throughout the remainder of 2010 and in 2011, according to Canada Mortgage and Housing Corporation's (CMHC'S) Housing Market Outlook - St. John's report released today.

   Housing starts are expected to end 2010 at 1,775 units, with 1,900 starts forecast for 2011. The resale or MLS(R)(1) market will post 3,650 sales by the end of this year and reach the 3,600 level in 2011. The average MLS(R) house price is expected to end 2010 at $245,000 compared to $218,862 in 2009 and increase to $255,000 in 2011. 

     "Despite the recent global economic uncertainty, strong fundamentals will continue to support demand for housing throughout the remainder of 2010 and in 2011," said Chris Janes, senior market analyst with CMHC in Newfoundland and Labrador. "Overall, the positive outlook for the St. John's area housing market will be reinforced by favourable trends in demographic and economic fundamentals, as well as on-going economic momentum fuelled by a lengthy list of major capital projects," added Janes. 

    As Canada's national housing agency, CMHC draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making vital decisions. 

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                               Forecast Summary
                               St. John's CMA
                                 Spring 2010
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                                                            %              %
                        2007     2008     2009    2010f   chg    2011f   chg
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    Resale Market
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    MLS(R) Sales          NA    3,835    3,642    3,650   0.2    3,600  -1.4
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    MLS(R) New
     Listings             NA    7,520    7,427    7,500   1.0    7,450  -0.7
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    MLS(R) Average
     Price($)             NA  187,571  218,862  245,000  11.9  255,000   4.1
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    New Home Market
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    Starts:
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      Single-Detached  1,174    1,485    1,385    1,450   4.7    1,550   6.9
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      Multiples          306      378      318      325   2.2      350   7.7
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      Starts - Total   1,480    1,863    1,703    1,775   4.2    1,900   7.0
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    Average Price ($):
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      Single-
       Detached      211,123  230,473  281,803  315,250  11.9  328,250   4.1
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    Median Price ($):
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      Single-
       Detached      189,900  215,372  260,000  291,000  11.9  303,000   4.1
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    New Housing
     Price Index
     (% chg.)            5.0     19.6     11.5      8.0   n/a      5.0   n/a
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    Rental Market
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    October Vacancy
     Rate (%)            2.6      0.8      0.9      1.0   0.1      1.3   0.3
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    Two-bedroom
     Average Rent
     (October) ($)       614      630      677      725   6.0      775  11.0
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    Economic Overview
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    Mortgage Rate
     (1 year) (%)       6.90     6.70     4.02     4.23  0.20     5.56  1.34
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    Mortgage Rate
     (5 year) (%)       7.07     7.06     5.63     6.20  0.57     7.06  0.86
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    Annual
     Employment
     Level            94,400   98,000   99,200  100,000   0.8  102,000   2.0
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    Employment
     Growth (%)          1.4      3.8      1.3      0.8   n/a      2.0   n/a
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    Unemployment
     rate (%)            6.9      7.8      8.1      8.0   n/a      7.5   n/a
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    Net
     Migration(1)      1,386    2,408    2,750    3,000   9.1    2,850  -5.0
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Source, MLS, CMHC