The July 2009
edition of CMHC's Monthly Housing
Statistics is now available and can be
accessed by clicking
HERE.
The
Government of Canada and Province of B.C. are
launching a new $123-million Seniors’ Rental
Housing Initiative to build up to 1,000 new
housing units for seniors and people with
disabilities.
“….In most
cases, modular, manufactured housing
construction will promote wood use…..”
This is an
important announcement in the current economic
environment and offers encouragement for MHABC
Member manufactured housing factories.
We expect
that B.C. Housing will present information on
this project at an Annual Meeting business
session on Friday, April 24th in Penticton.
Please see
the
announcement related to manufactured
housing in British Columbia.
B.C. ECONOMY
Premier
Gordon Campbell and Finance Minister Colin
Hansen were very sober when announcing yesterday
that British Columbia would
have deficit Provincial Budgets for the next two
years. This news following the federal budget
last week confirms that economic weakness is
real and likely to recover more slowly that all
would hope.
Reduced
demands for commodities like oil and gas, metals
and wood are specifically impacting B.C., in
addition to the fallout from the international
financial malaise triggered by the collapse of
venerable financial institutions in the United States and elsewhere.
Estimates
of B.C. economic activity vary but real domestic
product (value of goods and services) is
expected to decline in 2009, recovering in
2010. Similarly, employment growth will be
negative for two years while the unemployment
rate is estimated to hit 7.5% in 2010 and 2011
before falling. Up to 42,000 jobs are estimated
to be lost in B.C. this year. Housing starts
are estimated to fall further in 2009, reaching
only some 50% of the 40,000 recorded in 2007.
Retail sales growth has been seen to stall and
may be negative in the coming year. The
Consumer Price Index is also estimated to
falling to below 1% in 2009, rising modestly in
2010.
FEDERAL
BUDGET
However
with a Federal Budget designed to provide some
economic stimulus, though not so much to new
housing as to those renovating, the key message
has been use the stimulus measures “or lose
them” according to Federal Finance Minister
Flaherty. On the positive side, the national
economic leadership is now more specific and
encouraging. Much will depend on the extent to
which the province and local governments match
federal funds to activate projects and
programs. However, the uncertainty of the
several weeks over the year end is now past.
PROVINCIAL
BUDGET TO COME
The
B.C. Speech from the Throne next week and the
Provincial Budget the week after will bring
clarity to the government’s detailed approach in British Columbia. The Premier has spoken
about protecting health care and education and
administrative measures but not much about
economic stimulus in the province. A return of
public confidence in future economic performance
is expected after the Budget.
MANUFACTURED
HOUSING in B.C.
During
the unique economic circumstances that unraveled
from September on, manufactured housing in B.C.
has also been adversely affected by uncertainty
and concern in the marketplace. New home
shipments were down 40% in the period September
to December 2008 to 248 compared to 419 in the
same months in 2007, whereas shipments from
March through August were down 12%, in keeping
with the forecast last spring. (SEE the
attached Home Shipment Reports)
Depending
on the shipments reported for January and
February, it seems likely that new home
shipments for the March 2008-February 2009 year
will be down some 32-33% year over year to some
860 homes. The largest reductions are seen in
single-section home shipments down 34.1% year to
date, with multiple-section homes down 14.3%
year to date. The reduction in shipments
year-to-date has accrued to B.C. factories, as
there was a small increase (11 homes) in
shipments entering the province in the first 10
months.
Though
it is difficult to compare the general economic
circumstances today with just a few years ago,
new home activity on all fronts, including
site-built, could well retreat to levels seen
4-5 years ago. And, much will depend upon the
recovery of the
United States economy, since
Canada and the
United States
are each others largest customers.
References:
Federal Budget Highlights from KPMG - note
first time buyer provisions.
Federal Budget Tax Measures - including
first time home buyers
Home Renovation Tax Credit
The Canadian Home Builders Assoc. News Release
(PDF)
