Housing construction is expected to increase slightly over the next two years, but that will not be enough to return to affordability and meet demand.
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This was announced by the Association of Construction and Housing Professionals of Quebec (APCHQ) in a press release issued on Thursday.
“After 2023 saw the second-largest decline in housing starts since CMHC collected this data, the expected weak recovery in housing construction in 2024 to 2025 will clearly not be enough to meet the increase in demand,” emphasized Paul Cardinal. Director of Economic Services at APCHQ.
In order for rental and resale markets to become affordable again, construction starts would have to triple by 2030, APCHQ warned.
Increase in the construction industry
The number of new residential buildings is expected to increase by 13% in 2024 and by 14% in 2025, which corresponds to 44,000 new buildings in 2024 and 50,000 in 2025, the association calculated.
This slight increase is likely due to the normalization of interest rates.
Not surprisingly, the majority of housing starts will be for rental housing, and these are expected to account for seven out of every 10 new apartments in urban centers.
The increase in the construction of single-family homes and condominiums will be minimal.
Despite this increase, demand will remain too high to be met, particularly due to record immigration of non-permanent residents and the unaffordability of properties to purchase, the APCHQ said.
The construction of affordable rental housing will also be difficult given the persistently high construction costs, public taxes and financing conditions.
Forecast by region
However, there will be no increase, however small, in certain regions of the province in 2024, the APCHQ report highlighted.
This applies to the metropolitan regions of Quebec (-7%), Gatineau (-5%) and Saguenay (-18%), which are seeing a decline in housing starts.
In contrast, the Trois-Rivières region could see the largest increase in new housing construction in 2024.