THE Canadian Mortgage and Housing Corporation recently released its projections for the remainder of 2010 and through 2011 and the news is good for Manitobans. Our province experienced a rejuvenation of sorts this year in all categories, thereby allowing the consumer variety of choice in the coming year.
Manitoba new home starts reached an all-time high of 5,537 in 2008, but fell off sharply in 2009 to 4,174. Although our decline was far less pronounced than Saskatchewan and B.C., it still had a significant impact.
In Manitoba, more than $1.1 billion in wages and 24,900 jobs are reliant on the residential construction industry and so a drop of 25 per cent in production can cause a stir. However, Manitoba persevered very well through the worldwide economic downturn and came back even stronger in 2010. CMHC projections for this current year hover around 5,500 starts, a remarkable rebound.
Looking at particular segments of the market, single family detached starts did not decline nearly to the level of the multi-family starts in 2009. Saying that, the SFD sector still had a terrific year in 2010 and is at a level commensurate with the banner years of 2007 and 2008.
Projected to increase by 20 per cent this year, those numbers should be pretty well on par next year, too. Although mortgage rates may increase slightly in 2011, it should not be enough to deter the new home buyer.
Multi-family starts this year will more than double last year's. A lot of this activity was compensation for a lost previous year; however the CMHC anticipates close to similar production in that sector in 2011.
All of this projected residential construction activity spells good news for Manitoba's economy. However, we still must remain vigilant in ensuring that new home price affordability remains a constant here. Maintaining low interest rates for mortgages is critically important to new home buyers.
Of similar importance is the need to keep government-imposed charges to a minimum. Additional taxes, fees, building code changes and energy, water and fire code changes all have a price to them. That price impacts the consumer's ability to buy.
However, if all parties keep their eye on the prize, that being keeping Manitoba the most affordable province to live in, we will all win.
Mike Moore is president of the Manitoba Home Builders' Association.
