Canada Mortgage and Housing Corp. (CMHC) said it expects major cities across the country to post broad declines in home prices, re-sales and construction this year due to the coronavirus pandemic.
The federal housing agency does see a "tentative recovery" over the next two years provided there is not a second wave of coronavirus that again shuts down Canada’s economy.
Across Toronto, Montreal, Vancouver, Ottawa, Calgary and Edmonton, housing starts, sales and price growth will remain below 2019 levels throughout this year, CMHC said in a new report.
"Large employment and income declines, coupled with uncertainty over the future trajectory of the virus, will lower demand for housing," CMHC’s Deputy Chief Economist Aled ab Iorwerth said in the report. "Housing starts will fall sharply as construction decisions are delayed and builders work to protect employees’ safety on worksites. House prices will fall as well and are unlikely to recover over the horizon of this report."
Average home prices in Toronto, Montreal and Ottawa are expected to rebound sooner, starting in late 2020 and rolling into 2021. Prices in Vancouver, Edmonton and Calgary likely won't rebound until later in the forecast period, said CMHC.
