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CMHC revises forecast after slow start in Winnipeg resale market

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A slow start to the year has prompted Canada’s national housing agency to slightly downgrade its forecast for Winnipeg’s resale homes market for 2013, although its still predicting another banner year for local homebuilders.

In its Spring 2013 forecast released today, Canada Mortgage and Housing Corporation (CMHC) predicts sales of homes through the local Multiple Listing Service (MLS) will decline by 2.4 per cent to 11,800 units this year from 12,094 in 2012.

But despite the anticipated drop in sales, CMHC still predicts the average selling price of a home will still climb by 4.3 per cent to $266,000 this year from $255,058 in 2012.

The corporation said resale homes got off to a slow start this year, which will take a bite out of the year’s sales total.

However, "sales are expected to recover in the balance of the year," it said, and should continue to improve in 2014 and post a modest increase of 1.7 per cent.

On the new-homes front, the corporation is standing firm on its earlier prediction that housing starts in the Winnipeg Census Metropolitan Area will increase by 4.6 per cent to 4,250 units this year from 4,065 in 2012.

The increased building activity will be evident on both sides of the market, with single-family starts forecast to grow by 3.3 per cent to 2,200 units, and multiple-family starts expected to climb by 5.9 per cent to 2,050 units.

"Population and employment increases, combined with low mortgage rates, will prompt home builders to increase production levels this year," said Dianne Himbeault, CMHC’s senior market analyst for Winnipeg. "Increasing inventories will inhibit growth moving forward, keeping total starts at the same level in 2014."

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