Home construction and sales edging up

A new report from Canada Mortgage and Housing Corporation forecasts new home construction and sales in the Central Okanagan will move higher in 2010 and 2011.

CMHC Market Analyst, Paul Fabri, says demand for new and existing homes are expected to pick up as both regional and provincial economies grow, however, he cautions gains in new home construction and sales of existing homes will be modest.

"Slowly rising mortgage rates will exert a moderating influence, tempering growth in demand later this year," says Fabri.

He says housing starts, led by the detached home sector will increase this year and next.

"Kelowna's multi-family construction sector has moved away from large scale apartment-condominium projects."

Fabri says he does expect condominium construction to pick up again in 2011 as the inventory of completed and unoccupied units and the supply of existing homes available for sale is drawn down.

Existing home prices are also forecast to edge up over the next few years adds Fabri.

He says ample supply in combination with modest growth in demand will limit upward pressure on prices.

"Kelowna's existing home market is expected to remain stable in a balanced market position through 2011."