Calgary's housing market is expected to rebound in 2010 after housing starts, MLS sales and average MLS sale prices will continue to fall this year, says a report by Canada Mortgage and Housing Corp.

The Housing Market Outlook, released Thursday, forecast total housing starts in the Calgary census metropolitan area to drop by 51.9 per cent in 2009 from the previous year to 5,500 units but to increase by 12.7 per cent in 2010 to 6,200 units.

In the Calgary region, MLS sales are expected to fall by 13.6 per cent to 20,000 units this year while the average sale price will dip by 6.2 per cent to $380,000.

However, the CMHC forecast said MLS sales will increase by 10 per cent in 2010 from the year before to 22,000 units and the average sale price will also rise by 2.6 per cent next year to $390,000.

The Calgary CMA includes the city, Airdrie, the Municipal District of Rocky View, Chestermere, Cochrane, Irricana, Beiseker and Crossfield.{sidebar id=1}

At the provincial level, the CMHC is forecasting housing starts to dip by 34.2 per cent this year in Alberta to 19,200 units but rebound by 14.6 per cent in 2010 to 22,000 units.

In Alberta, total MLS sales are expected to fall by 11.3 per cent to 50,000 compared with a year ago while the average sale price is predicted to drop by 5.6 per cent to $333,000. However, the CMHC said MLS sales will increase by seven per cent in 2010 to 53,500 and the average sale price will rise by three per cent to $343,000.

"Despite price reductions for existing homes, low financing costs, and buyers' market conditions, Alberta's economic environment has prompted more cautious purchasing behaviour by households," said the CMHC. "As a result, existing home sales in Alberta will moderate for the third consecutive year in 2009. Once buyers gain confidence that prices have stabilized and economic conditions are improving, modestly higher sales should occur next year.

"Alberta's average resale price will be slow to rebound from the first decline in 13 years. Despite a decrease in the number of active listings, weaker sales will ensure the market remains fixed in buyers' conditions. As a result, the annual average price in 2009 will decline for the second consecutive year."

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