Vancouver housing market still strong: CMHC

Last Updated: Friday, May 18, 2007 | 1:08 PM PT

CBC News

The real estate market in Greater Vancouver is expected to remain strong over the next couple of years, says the Canada Mortgage and Housing Corporation.

CMHC says the resale market and new home construction will hold steady, with price increases expected to moderate.

Corporation analyst Robyn Adamache said housing starts will stay at the same level in 2007 as last year, at about 19,000 new homes.

But she noted that demand for housing is high because of B.C.'s strong economy, and that there could be more construction if it weren't for a couple of limiting factors.

"Builders are being challenged with increasing construction costs as well as labour shortages that are keeping projects going longer. So at this point, they're unable to start new projects until they get the old ones finished."

In the resale market, about 35,000 Lower Mainland homes will be sold this year, and the same number next year, Adamache predicted.

Growth isn't expected, because high prices are keeping would-be first-time homebuyers out of the market.

Adamache said prices are expected to increase in the next two years — about eight per cent this year and about five per cent in 2008.