Session A2: 10:20am WELCOME TO EDMONTON: THE IMPACT OF POPULATION GROWTH ON THE HOUSING MARKET

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Carmella Atkinson
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Session A2: 10:20am WELCOME TO EDMONTON: THE IMPACT OF POPULATION GROWTH ON THE HOUSING MARKET Moderator: Brad Gingerich, Senior Vice President, CBRE Limited Panel: Bill Blais, Vice President

1 Session A2: 10:20am WELCOME TO EDMONTON: THE IMPACT OF POPULATION GROWTH ON THE HOUSING MARKET Moderator: Brad Gingerich, Senior Vice President, CBRE Limited Panel: Bill Blais, Vice President Land Development, Maclab Enterprises Chris?na Butchart, Senior Market Analyst, CMHC Rohit Gupta, President, Rohit Communi?es Michael Smith, Senior Vice President, Mul? Family, WAM Development Group

2 2014 Edmonton Real Estate Forum May 8, 2014 Edmonton Economic and Housing Market Outlook Christina Butchart, Senior Market Analyst

3 Economic & Housing Outlook - Agenda Economic Outlook New Single-family Market New Multi-family Market Rental Market

4 net migration 40,000 Edmonton CMA Net Migration Net migration boosts housing demand 35,000 30,000 25,000 20,000 15,000 10,000 5, f 2015f Source: Statistics Canada, July to June, CMHC Forecast (f)

5 Edmonton CMA Population Growth Net migration fuelling higher population growth year-over-year per cent growth Source: Statistics Canada

6 7% 6% 5% 4% 3% 2% 1% 0% Edmonton CMA Employment Growth employment growth year-over-year Employment to increase in 2014 and % -2% f 2015f Source: Statistics Canada, CMHC Forecast (f)

7 Edmonton s New Single-Detached Market

8 units 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 Edmonton CMA Single-detached Starts New construction trending upward in Edmonton SAAR Trend 2,000 1, Source: CMHC, SAAR (Seasonally Adjusted Annualized Rate)

9 Edmonton CMA Single-detached Supply Supply gradually trending higher complete and unabsorbed plus units under construction 8,000 7,000 Inventory Under Construction 6,000 5,000 4,000 3,000 2,000 1, Source: CMHC

10 units Edmonton CMA Single-detached Starts Continued growth in single-detached construction in ,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1, f 2015f Source: CMHC, CMHC Forecast (f)

11 Edmonton CMA Single-detached Price absorbed price (6-month moving average) $600,000 Absorbed prices starting to move higher $500,000 $400,000 $300,000 $200,000 Average Median $100,000 $ Source: CMHC

12 Edmonton s New Multi-family Market

13 Edmonton CMA Multi-family Market Share Multi-family starts accounting for a larger share of the market Multi-family starts as a percentage of total starts 90% 80% 70% 60% 50% 40% 30% 20% Semi Row Apartment 10% 0% Source: CMHC

14 units 18,000 16,000 Edmonton CMA Multi-family Starts Multi-family construction trending lower SAAR Trend 14,000 12,000 10,000 8,000 6,000 4,000 2, Source: CMHC, SAAR (Seasonally Adjusted Annualized Rate)

15 units Edmonton CMA Multi-family Inventory Lower apartment inventories spurred construction in 2013 Semi Row Apt Source: CMHC

16 Edmonton Multi-family Under Construction Increase in units underway to put upward pressure on inventories units 12,000 Semi-detached Row Apartment 10,000 8,000 6,000 4,000 2, Source: CMHC

17 units 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 Edmonton CMA Multi-family Starts After strong performance in 2013, expected to moderate in , f 2015f Source: CMHC, CMHC Forecast (f)

18 Edmonton s Rental Market

19 per cent 5 Edmonton CMA Apartment Vacancy Rate Vacancy rate continued to decline in f 2015f Source: CMHC, October Surveys, CMHC Forecast (f)

20 Edmonton CMA Rental Apartment Starts Low vacancy rate has led to rental apartment construction units 2,000 1,500 1, Source: CMHC

21 Edmonton CMA Average Apartment Rent Rents will continue to rise average two-bedroom rent $1,200 $1,000 $800 $600 $400 $200 $ f 2015f Source: CMHC, October Surveys, CMHC Forecast (f)

22 Edmonton CMA Forecast Summary Economy f 2015f Employment Growth (%) Net Migration 24,928 38,511 20,000 18,000 Resale Market* Total Sales 17,641 19,552 19,800 20,100 Average Price $334,319 $344,977 $353,000 $360,000 New Home Market Single-detached Starts 5,658 5,970 6,200 6,300 Multi-family Starts 7,179 8,719 7,000 6,400 Rental Market (October Survey) Apartment Vacancy Rate 1.7% Housing market 1.4% intelligence 1.6% you can count 1.7% on Average Two-bedroom Rent $1,071 $1,141 $1,175 $1,200 * Total Residential Source: CMHC, Statistics Canada, CREA, CMHC Forecast (f) The forecasts included in this table reflect information available as of January 22, 2014

23 Contact Information Christina Butchart Senior Market Analyst, CMHC (780)

24 Thank You!

25 Disclaimer The information, analyses and opinions contained in this document are based on various sources believed to be reliable, but their accuracy cannot be guaranteed. The information, analyses and opinions shall not be taken as representations for which Canada Mortgage and Housing Corporation or any of its employees shall incur responsibility. 2014, Canada Mortgage and Housing Corporation. All rights reserved. CMHC grants reasonable rights of use of this document s content solely for personal, corporate or public policy research, and educational purposes. This permission consists of the right to use the content for general reference purposes in written analyses and in the reporting of results, conclusions and forecasts, including the citation of limited amounts of supporting data extracted from this document. CMHC retains the right to request that such use be discontinued for any reason. No use whatsoever can be made of the name, logo or other official marks of CMHC without the prior written consent of CMHC. The use, reproduction or broadcast of the document itself, in whole or in part, in its physical, electronic or any other form, is prohibited. Subject to the preceding conditions, any use, reproduction or transmission of the content of a CMHC document must include the source of the information, including statistical data, acknowledged as follows: Source: CMHC (or Adapted from CMHC, if appropriate), name and date of document.

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