Housing starts expected to drop

Housing starts expected to drop

By Advocate staff - February 09, 2008

The number of new housing construction projects in Red Deer is expected to drop 15 per cent this year from 2007.

The forecasted decline mirrors the situation throughout Alberta, where the Canada Mortgage and Housing Corp. predicts an 18 per cent decrease.

Builders in Alberta are contending with higher inventories of new homes and strong competition from the sale of existing homes.

Sale of existing houses in Red Deer is expected to decline two-and-a-half per cent in 2008, compared with a six per cent provincial decline.

But prices are forecasted to rise five per cent, to an average price of $285,000.

The housing agency still forecasts 900 houses and 425 units in multi-family dwellings will be started in Red Deer during 2008. That is down from 974 houses and 584 units in 2007.

Edmonton is forecasted to have the highest drop in residential starts at 21 per cent, followed by Calgary at 18.5 per cent. Wood Buffalo (For McMurray area) is holding steady, with a one per cent increase forecasted.

Urban housing starts across the province totalled 38,478 in 2007, down six per cent from 2006.

Nationally, the housing agency predicts a seven per cent decrease in housing starts for 2008, and a four per cent decrease in the sale of existing homes.