By Lanny McInnes
The 2017 housing start statistics recently released by the Canada Mortgage and Housing Corporation (CMHC) indicated that last year the City of Winnipeg and surrounding areas experienced the strongest year of new housing activity ever recorded by CMHC. Single family detached starts rose by 22% both within the City of Winnipeg and throughout the capital region compared to 2016. Multi-family starts in Winnipeg and surrounding areas increased significantly in 2017, growing by 52% compared to 2016.
Certainly, the race to build new homes, both single and multi-family, prior to the implementation of the City of Winnipeg’s new Impact Fee was a driver behind these strong housing start numbers. But that certainly wasn’t the only factor in why 2017 was a record year housing starts-wise in and around Winnipeg. CHMC identifies other factors such as a stable economy, strong employment and wage growth, and 2017’s record in-migration to Manitoba also contributing to an acceleration in housing starts, especially in the first half of 2017.
Other Manitoba communities also saw significant increases in housing starts in 2017. Total housing starts in Brandon were 30% higher than in 2016, with multi-family starts increasing by 41%. Steinbach saw total housing starts grow from 29 starts in 2016 to 257 starts in 2017 while the surrounding RM of Hanover also saw an astounding increase in housing start activity, going from 26 starts in 2016 to 218 starts in 2017. Factors such as in-migration certainly has played a significant role in the home construction activity in these communities.
These strong 2017 numbers, especially in and around Winnipeg, could also represent is a continued rebalancing in the housing market. From 2010 through 2013, the local housing market experienced significant growth filling a void that had long existed. However, in 2014 and 2015, the single family market slowed down while the multi-family market skyrocketed. So much so that for the past two years, the Canada Mortgage and Housing Corporation has flagged the Winnipeg apartment and condominium market to be saturated.
In 2015, what had traditionally been a fairly balanced distribution of housing style went completely out of norm with 68% of the housing starts being multi-family. 2016 saw 42% of the Winnipeg starts being single family and 58% of housing starts in Winnipeg being multi-family units. The 2017 distribution saw the split move to 40% single family and 60% multi-family. This is a much more balanced and likely to be standard split between the single and multi-family market for the time being.
While most projections for 2018 are anticipating housing starts in Manitoba to slow down compared to the 2017 record numbers, starts are still expected to be higher than 2015 and 2016 levels. This is good news for Manitoba’s economy, home buyers and for our residential construction industry.