CMHC paints rosy picture for 2013

New home construction is expected to increase next year.

That forecast was released Monday by the Canada Mortgage and Housing Corporation.

Not only is new home construction expected to rise in 2013, but sales are also expected to increase.

"Stronger employment growth coupled with low mortgage interest rates will support demand for new and existing homes in 2013," says CMHC Market Analyst, Paul Fabri.

"Lower inventories of new, completed and unoccupied units will also contribute to higher levels of new home construction next year."

Fabri says housing starts are forecast to top the 1,000 mark (1,050) in 2013 compared with 820 homes in 2012.

Both the detached home and multi-family sectors are expected to lead the way.

The uptick in MLA sales in 2012 is also expected to carry over into next year.

Fabri says home prices are expected to stabilize this year and edge higher through the second half of 2013 as demand picks up and the supply of available homes for sale slowly decreases.