CALGARY, July 21, 2016 — Canada Mortgage and Housing Corporation (CMHC) joins Canadians in expressing our concern for the people of Fort McMurray and the surrounding area that are dealing with the after effects of devastating forest fires. As part of its ongoing efforts to provide insights, analysis and report on special housing related topics, CMHC released today its latest Housing Market Insight (PDF) (HMI) report on Fort McMurray and the anticipated housing market response post fire.
Wildfires in Fort McMurray have destroyed approximately 10 per cent of all structures in the city. Even though the housing market was in declining conditions before the fire, experience from previous natural disasters suggests that there will be a large number of new housing starts as well as impacts on the resale and rental sectors of Fort McMurray’s housing market.
- If all homes that were destroyed have their replacements started in one year, it could be a record number of new starts and rebuilding activity for the city. However, many of these homes will not start construction this year due to the time required for cleanup and remediation.
- In the meantime, displaced individuals and construction workers will seek temporary rental accommodation. Vacancy rates in the purpose built rental markets in Fort McMurray are expected to decline rapidly from the vacancy rate of 29 per cent in October 2015. This will help stabilize rents which have been declining.
- It is too soon to tell how home prices will be impacted. Additional buyers and reduced inventory will provide support to lift prices, while low oil prices could continue to hamper price growth.
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As Canada’s authority on housing, CMHC contributes to the stability of the housing market and financial system, provides support for Canadians in housing need, and offers objective housing research and information to Canadian governments, consumers and the housing industry.
“Experience from previous natural disasters in Alberta suggests that many of the destroyed structures will be rebuilt. Fort McMurray will likely be no exception. Expect increased construction activity in the new home market and declining vacancy rates in Fort McMurray’s rental market over the near to medium term.”
Information on This Release:
Senior Public Affairs Advisor
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