Despite a surge in housing starts this January and during the past year, a decline in new home
In January, the seasonally adjusted, annual rate of housing starts in Ottawa-Gatineau was 8,646, up 54 per cent year-over-year compared to 5,611 in January of 2011.
But the Conference Board expects those numbers to decline, scoring Ottawa negatively in its short- and long-term expectations highlighted in the monthly report.
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“What we’ve seen is residential permits data over the past six months have fallen,” said Jane McIntyre, the author of the report. “We can maybe expect some slowdown in the market.”
The short-term expectation, based on residential permits, looks forward six months, whereas the long-term forecast spans five years.
Ms. McIntyre said the expected public service cuts as well as the potential increase in interest rates weighed on Ottawa’s long-term forecast.
Of the 27 Canadian cities covered in the report, 14 have positive short-term expectations, up from seven the previous month.
Cities with positive expectations for both the short- and long-term are concentrated in Ontario and Western Canada, including Sudbury, Oshawa, Toronto, London, Windsor, Calgary, Edmonton and Vancouver.
Those keeping Ottawa company with negative short- and long-term expectations are St. John’s, Saint John, Quebec City, Montreal, Sherbrooke, Thunder Bay, St. Catherines-Niagara and Victoria.
The negative forecast comes just days after a Canada Mortgage and Housing Corp. report detailing a 125-per-cent increase in Ottawa housing starts, up to 484 from 216 in 2011.
Leading the increase was a more than four-fold increase in apartment-style housing starts, with 245 apartment starts breaking ground in January 2012 – 433 per cent more than the 46 started the year previous.
Multiple-family homes saw an increase of 220 per cent, and single-family homes rose a modest 18 per cent.
Most construction took place in the city’s core, the CMHC noted.
Nationally, seasonally adjusted starts increased by 16 per cent to 197,900 in January, but were virtually flat since December.
The one-per-cent decrease since last month was due to declines in multiple-housing starts in Quebec and Atlantic Canada, the CMHC stated.
construction in Ottawa is on the horizon, according to the Conference Board of Canada.
