Vacancy rate to hit 30-year low

Magrath

Vacancy rate to hit 30-year low (10:30 a.m.)
October’s rate forecast at 0.7%, even lower in 2008
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Ron Chalmers
- s* D. c0 f  v' J- gedmontonjournal.com
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6 M/ c( T2 B" `4 l, D) P: kTuesday, May 15, 2007
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EDMONTON - Edmonton-area apartment vacancies will drop to a 30-year low of 0.7 per cent in October.
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Then they'll go lower.

% a% |0 z. V" P+ u5 [8 ["Strong demand from newcomers and a shortage of new units entering the market" will reduce vacancy rates to 0.5 per cent in 2008, says a forecast released today by Canada Mortgage and Housing Corporation.
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- l/ c+ o0 A% ]6 `  R$ q! U"The average rent for a two-bedroom unit will increase from $808 per month in October, 2006, to $970 in October, 2007," the national housing agency predicted. "Further gains will push the average two-bedroom rent to $1,115 in October, 2008."

Richard Goatcher, CMHC's senior market analyst for Edmonton, predicted that "total housing starts will moderate slightly this year in greater Edmonton to 14,150 units but will still represent the third highest year on record."
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& z3 f! [) ?; `6 S% ~& v7 NUnfortunately for renters, the great majority of new construction will be of single-family homes or condominiums that mainly will sell to owner occupants.
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The balance is shifting toward condos because of high costs, an inventory of unsold single-family homes, and a shortage of building lots.
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3 g+ h" S) _2 R/ m8 s& f( t/ l; O( ^Multiple unit starts, mostly condos, will reach the highest level since 1982, with 6,000 units in 2007 and close to 5,500 in 2008.
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Goatcher traced the continued brisk construction activity to regional economic strength, in-migration and stable mortgage rates.
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4 [1 q, {2 ]2 f0 k4 VSales of resale homes, which hit a record number of 21,984 units in 2006, will rise even higher in 2007 with the growth of new listings, CMHC predicted. Sale are expected to fall slightly in 2008 as high prices will deter first-time buyers.
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CMHC forecasts that full-year average prices, for all forms of resale housing, will rise from $251,000 in 2006 to $340,000 in 2007 and $374,000 in 2008. But that forecast may already be outdated, as the Edmonton Real Estate Board has reported that prices averaged $344,137 in April.

7 i7 u, C' L+ Q& T  ~rchalmers@thejournal.canwest.com
© Edmonton Journal 2007