While the real estate market collapses to the south, the market out west appears to have peaked and, with the east having already done so years ago, Manitoba is currently basking
in its record growth. Canada Mortgage and Housing Corporation reports that, in 2007, Winnipeg led the national renovation industry. Roughly 44 per cent of homeowners completed projects of $1,000 or more, and that number was projected to increase to 45 per cent this year. New starts, meanwhile, were up a robust 11.8 per cent in last year and are pegged to tapper off only slightly to 10.2 per cent this year.
Business has been so brisk that a serious dearth of skilled trades is beginning to develop in the province. Manitoba’s construction industry employs almost 22,000 workers and, according to the Manitoba Building and Construction Trades Council, up to 6,000 new workers may be required to keep pace with new projects while another 4,500 workers will be needed simply to replace retiring baby boomers between now and 2016.
Housing Styles Poised for Change
One of the most important trends facing Canadian home builders today is the specter of retiring baby boomers and how their housing choices over the next decade or so will impact the types of projects carried out in the market. Will they remain in their current dwellings? Move to a smaller home in Canada? Pick up and move abroad? The possibilities are numerous and the impact of their eventual choices will be tremendous, and Manitoba — though it is the province with the second youngest population in the country according to the 2006 national census — is in no way immune to this phenomenon.
“The one thing that Manitoba has, quite frankly, as a prairie province is lots of land,” notes Derek Thorsteinson, president of Parkhill Homes, one of the province’s most accomplished builders. “But I think the aging population demographic, particularly for the baby boomer market, is going to have a focus probably to a much greater extent on secondary housing in another climate and probably the downsizing of the larger home into a condominium or single-family condominium type of structure.”
The numbers certainly support Thorsteinson’s hypothesis. According to the CMHC, over the last four years, multi-family starts have gone from accounting for about half as many starts as single-detached units in Winnipeg, to doubling them today. In fact, while single-detached starts have more or less plateaued, the number of new multi-families has quadrupled over that period.
All Good Things Must Come To an End
The value being put into homes is rising quickly, however. The median year-to-date price increase in 2008 versus 2007 is over 10 per cent for single-detached units.
These are boom times in Manitoba. As the British Columbia market can certainly attest, rising average prices and new starts can’t go on forever. That being said, it will be a fun ride while it lasts for home builders throughout the province.