RENTAL HOUSING CONSTRUCTION IN QUEBEC WILL DECREASE 40% IN 2023
Construction of rental housing in Quebec is forecasted to fall by 40 per cent in 2023, according to a report from the provincial homebuilder’s association (APCHQ).
It’s a significant slowdown compared to 2022, when rental construction fell by 13 per cent.
The reason for this drop in productivity?
“The recent increase in financing costs has significantly undermined the profitability of several rental property projects,” the report, released Wednesday, states.
In other words, while inflation and high construction costs have slowed slightly, the effects are still felt in 2023.
The decline in construction comes at a time when demand for rental housing is high — and is expected only to get higher.
According to Quebec’s latest demographic report, the province experienced more population growth in 2022 than in 50 years, up by nearly 150,000 people.
This increase, which followed a major slowdown caused by the COVID-19 pandemic, results from a surge in permanent and temporary immigration.
The APCHQ notes that newcomers often seek rental housing upon their arrival in Quebec, especially non-permanent residents “because of their temporary status.”
NEW HOUSES AND CONDOS ALSO DOWN
Like renters, prospective homebuyers will also see fewer options built in 2023.
The number of foundations laid to create single-family homes was down 24 per cent in 2022, and “a decline of the same order” is expected this year.
The association predicts 8,000 new single-family homes will be constructed in 2023, while 9,000 are expected in 2024.
The rate of condo construction is also anticipated to fall, this time by 14 per cent with 6,000 new units on the way.
These figures, alongside other factors, paint a bleak picture of housing accessibility in Quebec, says the APCHQ.
“The aging population, the difficulty of accessing home ownership and, above all, the explosion of migration will stimulate the demand for rental housing like never before,” the report reads.
Story by: CTV News