No Boom, No Bust as Condo Market Remains Stable Across the Country

No Boom, No Bust as Condo Market Remains Stable Across the Country 
Genworth Canada Releases Summer 2013 Metropolitan Condo Outlook 
TORONTO, Aug. 28, 2013 /CNW/ - Record growth is not in the foreseeable future 
of the condo market, but it is also likely the sector will be able to avoid a 
major downturn, according to the latest Conference Board of Canada condo 
report released by Genworth Canada. While markets in major centres such as 
Vancouver, Montreal and Toronto have been of particular concern, The Summer 
2013 Metropolitan Condo Outlook suggests population growth and employment 
gains will help maintain demand levels to absorb supply inventory. 
"Whether it's first-time homebuyers entering homeownership, empty-nesters 
looking to downsize or professionals seeking a shorter commute, condos appear 
to remain a popular option for urban Canadians," said Brian Hurley, Chairman 
and CEO of Genworth Canada. 
The Report notes economic factors affecting the housing market, such as 
employment, interest rates and population growth, will only undergo moderate 
changes. Employment is expected to rise modestly in the medium-term and 
interest rates are expected to increase gradually, while population expansion 
and demographics will continue to support demand in regional markets. 
"As condo starts near past averages and inventories edge closer to demand, we 
are seeing the condo market stabilize both in terms of the price of existing 
units and the volume of new construction," said Robin Wiebe, Senior Economist 
at the Centre for Municipal Studies at The Conference Board of Canada. 
"Softer prices and positive economic factors continue to make condos an 
affordable way for Canadians to achieve homeownership." 
Regional Highlights 


    --  Québec City's condo starts will start to return to long-term
        average, with average resale prices expected to show a moderate
        rise of 1.1 per cent in 2013 and 1.9 per cent in 2014, which
        will allow demand to increase until 2016 as it catches up with
        supply
    --  Montréal's steady economic growth and aging population will
        bolster unit sales, but volume growth is expected to be a
        modest 1.4 per cent per year from 2015 to 2017
    --  Ottawa's regional economy is still feeling the effects of
        government spending cuts which weakened demand and slowed price
        increases, but economic growth expected in 2014 will help
        increase demand and unit sales by about 2.5 per cent per year
        from 2015 to 2017
    --  Toronto's inventory of completed and unsold new condominiums
        was up in 2012, so builders are expected to pull back from the
        market in 2013 and 2014, but a stable economy and population
        growth are expected to bring builders and buyers back to the
        market by 2015
    --  Calgary starts will be hampered in the third quarter by the
        flooding earlier in the year, but as the "youngest" city in the
        survey, it is expected to enjoy the highest growth in starts
        and resale volumes in 2014, with price growth at a moderate
        level of 2 per cent to 3.5 percent over the next few years.
    --  Edmonton inventory levels will become more balanced, with the
        median price expected to rise slightly in 2013 - the city's
        first gain since 2007
    --  Vancouver remains the most expensive housing market in the
        country, but condos remain an affordable option. It's expected
        to continue to be a buyer's market in 2013, with sales and
        prices picking up in 2014.
    --  Victoria faces the greatest challenges with the lowest number
        of starts among the report's eight cities and no growth in
        resale prices or sales until 2014. Despite its mild climate and
        attractive surroundings, a high inventory of unsold new units
        and constrained demand due to a soft economy will continue to
        cause drag on the condo market in Victoria

Resale prices for condos are expected to rise next year in all eight cities 
studied, with Calgary showing the largest growth of 3.3 per cent and 
Vancouver, following two years of price decline, growing only 1.4 per cent.

Average Resale Condo Price by City: Forecast

 
________________________________________________________________________________________________________________________
______________________________________________
|City                                                                                                                   


                |    2012|   2013f|   2014f|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Québec City|$220,860|$223,363|$227,575|
|                                                                                                                        
                |     7.4|     1.1|     1.9|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Montréal  |$267,175|$265,344|$271,899|
|                                                                                                                        
                |     4.0|    -0.7|     2.5|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Ottawa    |$271,331|$272,282|$280,626|
|                                                                                                                        
                |     3.8|     0.4|     3.1|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Toronto   |$305,350|$305,239|$310,242|
|                                                                                                                        
                |     1.5|     0.0|     1.6|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Calgary   |$244,362|$251,237|$259,640|
|                                                                                                                        
                |     3.0|     2.8|     3.3|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Edmonton  |$210,577|$214,680|$220,743|
|                                                                                                                        
                |    -1.2|     1.9|     2.8|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Vancouver |$366,263|$364,593|$369,527|
|                                                                                                                        
                |    -1.7|    -0.5|     1.4|
|_______________________________________________________________________________________________________________________
____________________|________|________|________|
|Victoria  |$268,633|$264,180|$273,783|
|                                                                                                                        
                |    -6.5|    -1.7|     3.6|
|_______________________________________________________________________________________________________________________
____________________|________|________|________| 
Italics indicate percentage change from previous year. 
Sources: The Conference Board of Canada; CMHC Housing Time Series
Database; Canadian Real Estate Association; Québec Federation of Real
Estate Boards. Average resale prices are used for Québec City and
Montréal; median resale prices are used for the rest of the
metropolitan areas. Resale and average prices in Montréal and Québec
City include all condo styles, not just apartments. 
Produced twice a year, the Metropolitan Condo Outlook is commissioned by 
Genworth Canada from the Conference Board of Canada. The Report reviews a wide 
range of condominium statistics and offers an in-depth analysis of the trends 
in the condominium market for eight large Canadian metropolitan areas: Québec 
City, Montréal, Ottawa, Toronto, Calgary, Edmonton, Vancouver and Victoria. A 
copy of the report is available at: 
http://genworth.ca/en/about-us/about-us-publications.aspx . 
About Genworth Canada
Genworth MI Canada Inc. (TSX: MIC) through its subsidiary, Genworth Financial 
Mortgage Insurance Company Canada (Genworth Canada), is the largest private 
residential mortgage insurer in Canada. The Company provides mortgage 
default insurance to Canadian residential mortgage lenders, making 
homeownership more accessible to first-time homebuyers. Genworth Canada 
differentiates itself through customer service excellence, innovative 
processing technology and a robust risk management framework. For almost two 
decades, Genworth Canada has supported the housing market by providing thought 
leadership and a focus on the safety and soundness of the mortgage finance 
system. As at June 30, 2013, Genworth Canada, had $5.6 billion total 
assets and $3.0 billion shareholders' equity. Find out more at www.genworth.ca. 
 or to arrange interviews, please contact: Lisa Azzuolo Genworth Canada 
905.287.5520 orLisa.Azzuolo@genworth.com 
SOURCE: Genworth Canada 
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CO: Genworth MI Canada
ST: Ontario
NI: REL REL ECOSURV ECO  
-0- Aug/28/2013 11:00 GMT