Turns out that 2011 isn’t looking any brighter than 2010, when it comes to the housing market.
The Canada Mortgage and Housing Corporation came out with a report Tuesday, pointing out that 33 Kelowna housing starts this January show a decreased level of building activity from the 161 reported year before.
Much of that, explained CMHC market analyst Paul Fabri, can be pinned on a failing condo market, as the lingering supply of new, completed and unoccupied condominium apartment units is constraining multi-family construction.
The resale market is also a strong competitor for the single home development.
“While housing starts have moved higher over the past year, Kelowna’s new home construction sector continues to face strong price competition from a well supplied existing home market,” Fabri said.
While 2010 was far from a banner year, it offered the opportunity for those in the business of building rental properties to get busy and the disparity between this year and last was pinned on that.
“Rental apartment construction pushed up housing starts to unusually high levels in January 2010,” he said. While it’s the resale market that’s limiting growth in the new home market, a report released Tuesday by Re/Max Canada also didn’t point to a particularly robust housing market locally, although things are looking up in the rest of the country.
A number of city centres are already reporting stronger than usual housing activity out of the gate, with first time buyers comprising the vast majority of purchasers and move-up buyers in close pursuit.
Demand and supply are on relatively even keel at present in most areas, but the traditionally busy spring season is expected to keep the market at a perfect equilibrium in the days and months ahead.
“However, there may be some exceptions to the rule. The country’s largest markets—Greater Toronto, Greater Montreal, and Greater Vancouver—are expected to head into the second quarter with fewer listings overall. Two centres— Newfoundland & Labrador and Kelowna—are still firmly entrenched in buyer’s markets,” read the report.