A recent report by the Canadian Mortgage and Housing Corporation (CMHC) says that homeownership will be more attainable in the prairie provinces over the next two to three years.
The report was released on April 27 and contains an outlook on housing supply and cost for 2023 to 2025.
The overall national outlook shows that the housing supply will not be able to meet demand. The report says while prices have declined, homeownership will be less affordable because of higher mortgage rates and still-elevated price levels. Until the end of 2022, the Bank of Canada consistently increased interest rates to the present rate of 4.5%. This has made large purchases more expensive and slowed overall consumer spending.
The report also provided some context on the national outlook for rentals. It says rental affordability is also set to decline due to demand outstripping supply, especially in Vancouver and Toronto, which are also home to the highest numbers of newcomers in the country.
When examined in a regional context, the prairies and the Atlantic region appear to offer more stability.
The Prairie provinces
The Prairie provinces of Alberta, Saskatchewan and Manitoba are expected to see more positive housing market developments than other regions in Canada.
The report says this is because of a much smaller decline in housing starts (the number of privately owned homes under construction) in 2023.
It says high interprovincial migration has had a positive impact on the market compared to other regions over the forecast period. The average price of a house in these provinces is less than $470,000 according to the most recent data from the Canadian Real Estate Association.