Saturday, August 06, 2005

We're Canada's Red-hot province!

From the Winnipeg Free Press, Friday, August 5, 2005.

We're Canada's Red-hot province!

By Geoff Kirbyson

MANITOBA'S red-hot housing market shows no signs of letting up. The Winnipeg Real Estate Board announced yesterday that house sales through its Multiple Listing Service burst through the $1-billion mark on Wednesday -- six weeks earlier than ever before.
"Every single month this year we've been breaking records," Ruthe Penner, president of the WREB, said in an interview yesterday.

Also yesterday, the Canada Mortgage and Housing Corp. predicted Manitoba will be the only province in the country to see increases in housing construction both this year and next.

In its third-quarter Housing Market Outlook, the CMHC forecast 4,600 new housing starts in the province this year, up from 4,440 in 2004, and another 4,800 next year.

"What we're dealing with is a great deal of pent up demand. Essentially, we're looking at trying to get growth in our housing stock to match our growth in population," Dianne Himbeault, senior market analyst for CMHC, said in an interview yesterday.

Both Penner and Himbeault said the underlying strength of the economy, growing consumer confidence, low interest rates, low unemployment and population growth have created an environment where people are increasingly able to make the most expensive purchase of their lives -- a house. Penner said the market isn't showing any signs of slowing down and even if interest rates start to rise, as is widely expected later this year, demand for houses still far outstrips supply.

She added another positive sign for the economy is, for the first time in the WREB's history, the luxury home segment -- those worth more than $300,000 -- is outselling the $60,000-and-under price range, she said.

"That's unprecedented in this market. It used to be 60 per cent of the homes in Winnipeg sold for less than $100,000 and 40 per cent sold for more than $100,000. That's completely reversed now," she said.

Perhaps the most promising indicator for the future is that Manitoba's population has grown by 11,000 people since 2002, including nearly 5,000 people in the past year alone. With more people invariably come more taxpayers, increased retail sales, higher government revenues and an increased ability for the government to provide services.

Wilf Falk, the province's chief statistician, said Manitoba hasn't had this kind of population growth in 20 years.

"(Since 2002) we've had more people coming (to the province) than leaving. That's obviously going to create more demand for housing," he said in an interview yesterday. He added Manitoba continues to have one of the best employment pictures in the country. As of last month, the unemployment rate in the province was 4.8 per cent, tied with Saskatchewan for second lowest in the country, and trailing only Alberta's 3.8 per cent.

The population trends are reflected in the amount of business headhunting firms such as David Aplin Recruiting are getting. Mark Shayna, one of its vice-presidents, said over the past three years there has been a growing demand for people to fill positions in sales, information technology and accounting positions at Manitoba companies.

"We're not replacing people, these are new positions," he said in an interview yesterday. "There's a huge trend of professionals moving back to Winnipeg. They've moved to Toronto, Vancouver or Calgary, but they want to move home for a better balance of life and a lower cost of living. A lot of them are coming here without jobs, but they've decided to make a commitment to their families."

Shayna said while it's still difficult to convince Winnipeggers to relocate, it's now getting easier to persuade people from outside the province to move here.

"We're on the phone dealing with guys out east who want a change of pace. They realize Winnipeg has a lot to offer and once they get out here, they don't want to leave. They're able to raise a family and do less travelling. It's a change of lifestyle for them," he said.

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