Multi-fam­ily trend thrives in down­town core

Calgary Herald - Calgary Herald New Condos - - New Condos - BRIAN BUR­TON

Any­one who trav­els Deer­foot Trail knows the sub­ur­ban com­muter is far from an en­dan­gered species.

But the begin­nings of a change in Cal­gary’s res­i­den­tial character may be re­flected in the lat­est num­bers from the Canada Mort­gage and Hous­ing Cor­po­ra­tion (CMHC).

In the first nine months of 2014, sin­gle-fam­ily hous­ing starts are up by two per cent from the same pe­riod in 2013, while all types of multi-fam­ily starts show a gain of 110 per cent.

“There def­i­nitely is that strong de­mand for multi-fam­ily,” said Feli­cia Mut­heardy, CMHC mar­ket an­a­lyst.

And the largest share of multi-fam­ily con­struc­tion is tak­ing place in and around the down­town core, she adds.

It could be in part, “a prod­uct of those years of record net mi­gra­tion” to Cal­gary in 2012 and 2013, Mut­heardy says. That re­cent in­flux shows an age dis­tri­bu­tion that is “quite young” and likely look­ing for homes priced be­low the re­cent Cal­gary sin­gle-fam­ily av­er­age price, now well above $500,000, ac­cord­ing to the lat­est fig­ures from the Cal­gary Real Es­tate Board.

Typ­i­cally, she says, the younger mar­ket in­cludes a large con­tin­gent of renters, but with tight vacancy rates in the city, more young peo­ple may be mov­ing to the first-time home­buyer mar­ket. That group may also be aug­mented by baby boomers opt­ing to down­size and sim­plify by mov­ing closer to the ameni- ties in the core. Mut­heardy says CMHC has no spe­cific data on th­ese two points, but is hear­ing anec­do­tally from its con­tacts in the mar­ket that multi-fam­ily de­mand in down­town Cal­gary is draw­ing support from th­ese de­mo­graph­ics.

Oc­to­ber showed the same mul­ti­fam­ily lean­ing, with sin­gle-fam­ily starts down 20 per cent to 464 from 569 in Oc­to­ber 2013, while multi-fam­ily starts jumped 61 per cent, to 956 from 593. The an­nu­al­ized trend in all types of hous­ing starts reached its peak in Au­gust, at 18,930, the high­est level since at least 1990, be­fore which data is not im­me­di­ately ac­ces­si­ble, Mut­heardy says. The an­nu­al­ized trend has dipped slightly to 18,487 in Septem­ber and 18,382 in Oc­to­ber.

“De­spite the mod­est (trend) re­duc­tion, the pace of hous­ing starts re­mains el­e­vated, par­tic­u­larly in the multi-fam­ily mar­ket, where the inventory of com­plete and un­ab­sorbed units re­mains low,” she says.

The trend is a six-month mov­ing av­er­age of the monthly sea­son­ally ad­justed an­nual rate of to­tal hous­ing starts. CMHC uses the mea­sure­ment to even out monthly swings in the num­bers.

Claire Young/Cal­gary Her­ald

In the first nine months of 2014, sin­gle-fam­ily hous­ing starts in Cal­gary are up by two per cent from 2013. Multi-fam­ily starts show a gain of 110 per cent.

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