CMHC have released their forecast for the Ontario housing market. Owing to economic uncertainty, Ontario sales will range between 171,120 to 218,600 transactions for 2012 and also for 2013. New home starts are forecast to be 63,450 in 2012 down from 67,821 in 2011. With 40,250 being multiple-unit housing starts and 23,200 being single dwelling housing starts. The Point Forecast average price for 2012 is to be $374,300 with a Low Forecast of $334,800 to a High Forecast of $416,000 in Ontario. The Canadian numbers are Point Forecast of 368,900 with a Low Forecast of $330,000 to a High Forecast of $410,000.
Ontario’s economy after leading Canada’s economy through recovery will lag growth in the rest of Canada in 2012. Historically high commodity prices will benefit Northern Ontario and their housing markets will outperform in 2012. Ontario’s population growth will be driven by immigration. However, migration inflows from other provinces will moderate as Ontario’s economic and job prospects fall short of the Canadian average in the near term.
The mortgage rate outlook with the Bank of Canada (December 6, 2011) announcement indicates that the Bank will be leaving the target overnight interest rate unchanged at 1.0 per cent for the medium term. The Bank has been noting that continuing global economic and financial uncertainty, particularly in Europe, continues to be a concern. Mortgage rates, particularly short term mortgage rates and variable mortgage rates are expected to remain near historically low levels.