CMHC Forecasts Housing Market Will Not Recover Until at Least 2022

The Canadian Mortgage and Housing Corporation (CMHC) has recently released a forecast for the remainder of 2020 and 2021. According to the report, house prices could further decrease between 9% to 18% compared to the first quarter of 2020, with no sign of recovery until at least the following year. Some regions which are heavily dependent on commodity revenue such as oil, could see home prices drop by up to 25%.

Furthermore, the most pessimistic scenario could see that currently mounting mortgage deferrals could translate to increased foreclosures, further devastating the housing market and economy as a whole.

Before the coronavirus pandemic, the average house price was approximately $540,000, now however, the average could drop to anywhere between $493,000 and $518,000. Furthermore, the CMHC is anticipating the construction of new homes to slow down drastically, with housing starts decreasing by 75% due to construction activity restrictions. A recovery is not likely until at least the second quarter of 2021. In the meantime, the CMHC is forecasting home sales to drop by 29%, with no recovery in sight until 2022.

Source: CREA

Information for this briefing was found via CBC News and the Canadian Mortgage and Housing Corporation. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Mergers Set the Stage for Uranium’s Growth Cycle | Forum-Baselode Merger

The Goal is Gold Production as Soon as Possible! | Gordon Robb – ESGOLD Corp.

Snowline Gold: The Multi Billion Dollar Valley PEA

Recommended

First Majestic Produces 7.9 Silver Equivalent Ounces In Q2, Lifts Production Guidance

Antimony Resources Drills 4.17% Antimony Over 7.4 Metres At Bald Hill

Related News

Canada’s Trade Surplus Widens to $1.94B in August as Energy Exports Surge

Canada’s trade balance remained in a surplus position for the third consecutive month, widening from...

Wednesday, October 6, 2021, 04:35:00 PM

CMHC: Canada Could Face A “Mild Recession” In A 3.5% Interest Rate Scenario

The Canadian economy might be headed for a “mild recession” should the Bank of Canada...

Tuesday, July 12, 2022, 02:21:00 PM

Canadian Mortgage Debt Rises At Fastest Pace Since 2010

Mortgage debt among Canadian households increased at the fastest pace in a decade, amid record-low...

Saturday, February 20, 2021, 11:17:00 AM

Lumber Prices Soar 250% as Pandemic Pushes Home-Building Higher

Lumber prices have surged by almost 250% since April 2020, significantly threatening housing affordability across...

Saturday, May 1, 2021, 05:01:00 PM

US Homebuilder Confidence Falls From Record High as Buyers Face Affordability Challenges

As home prices across the US continue to skyrocket to record-breaking levels amid a surge...

Friday, December 18, 2020, 10:45:59 AM