Housing starts declined further in Okotoks during the third quarter, but the Town has seen an increase in industrial and commercial development.
Okotoks permit/inspection/assessment manager Rob Mueller said the residential sector decline hurts the town’s growth projections in what has historically been its most active area of development.
It’s the non-residential construction that’s keeping Okotoks’ development in the black, he said. With projects like Save-On Foods, Six Corners Brew Works, medical offices, Tim Hortons and office buildings, the Town is seeing a flurry of activity in its industrial and commercial sectors, he said.
“We’re really seeing what the economy is doing throughout Alberta,” said Mueller.
The industrial and commercial sector has seen $21 million in construction from January to September, he said. That amount surpasses the total of construction from 2015, which closed out just shy of $16 million.
He said the economic decline has impacted Okotoks’ housing market, as developers aren’t feeling the demand they did in previous years. Most of the summer’s activity took place in the Mountainview area, he said.
Developers are building speculation homes and hoping to turn them into sales, he said.
“They’re not having the people move into the province looking for a house like they might have before,” said Mueller. “They’re feeling the market they’re in, they’re having people who want to sell their home prior to purchasing another home so they’re not getting into two-mortgage situations. It’s changed.”
He said the expected number of housing starts will probably drop to 150 for 2017, about the same number achieved in 2016. If nothing changes with residential construction or demand, he said that number provides the Town with about one to one and a half years of supply.
Okotoks development services manager Michael McIntyre said the greatest obstacle facing construction in town is limited water supply. There is limited developable land in Okotoks until sufficient water is available for the Town, he said.
“If we see another 150 lots or housing starts next year and the year after that, then three years from now we’d be out of lots technically,” said McIntyre. “If there’s a surge in the economy then the remaining lots could suddenly come on the market very quickly and in a year and a half to two years you could be looking at a deficit of lots for new homes.”
If development levels remain the same, he said the Town shouldn’t have any trouble waiting out a water pipeline over the next couple of years.
