Canadian housing export market brief / CMHC

The Top Three: The United States, Japan and Germany are Canada's biggest export markets for housing. Despite having built up a natural affinity towards these countries over the years, each country represents a different challenge and commands a different strategy in today's global marketplace.

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United States

The Canadian housing industry faces stiff domestic competition in this market. Most Canadian housing exports destined for the United States comprise of wood or wood-based products. These, as well as value-added products (windows, doors, HVAC systems, etc.), move easily across the border under NAFTA. While the low Canadian dollar continues to prove advantageous for Canadian exporters in the year ahead, the challenge for the Canadian housing industry in the long-term is to develop markets and to capitalize on the growth forecast for the southwestern and southeastern regions of the country. Some industry members have also raised the challenge posed by cross-border movement of personnel. Finally, both countries share concerns for the environment and face an aging population and housing stock.

Japan

The challenge for the Canadian housing industry during this period of economic turmoil in Japan is to maintain its position, to deal with housing quality problems, to continue to develop market niches, and to diversify the Japanese client-base. Any significant withdrawal of Canadian housing firms during this period, could have a major impact on the long-term prospects of the industry as a whole, and jeopardize Canada's position attained over the last 25 years. The economic downturn has hit hardest in Japan's most populous cities, while economies in other regions are more stable and offer many untapped opportunities. A better understanding of Japan's future housing needs and wants is vital to maintaining and strengthening Canada's position in this market and enhancing our competitive edge.

Germany

Germany is seen as a key European market where success can open other markets in the European Union. The need for better coordination of all parties involved in developing Canadian housing opportunities in this country was a key message from the industry consultations. The industry recognizes CMHC as having had an instrumental role in putting forward the application to German authorities for certification of the Canadian wood frame construction system. Additional concerted efforts and projects aimed at developing this market involving all Team Canada partners as well as German counterparts need to be undertaken. Industry also confirmed the need to raise consumer awareness and acceptance of wood frame housing as a viable, energy-efficient alternative to concrete or brick systems.

The Emerging Markets

Countries like Chile and Korea represent markets where the Canadian housing industry's business development efforts and CMHC's presence is proving to be a winning formula. CMHC will allocate resources to activities in these markets based on the best possible return on investment for the Canadian housing industry.

Chile

Chile is becoming a modern economic market and CMHC has been at the forefront assisting this country develop various facets of its housing system, and furthering the acceptance of wood frame construction. A revamped, modern building code is required to allow greater use and acceptance of wood frame and other construction systems, as is increased training of the Chilean housing industry. Fostering consumer awareness is necessary to help penetrate this market and monitoring is required to ensure the quality and authenticity of imported Canadian housing products.

Korea

Despite the economic slowdown in Korea, the following factors have created favourable conditions for the Canadian housing industry in this market: a growing movement away from urban centres to "country-style" living; attraction for living in Western-style housing and in healthy living environments; flexible land development regime which allows for small subdivisions to be autonomously serviced; acceptance of light frame construction and wood construction under current Korean building codes; and a concern for construction safety and housing quality.

The government is introducing new financial and real estate reforms geared to attract foreign investments to help pull this country out of its economic doldrums. This presents Canadian land developers with investment opportunities and possibilities for joint venture projects. The strategy for Korea calls for building on Canadian successes, and maintaining and strengthening a Canadian presence in the future.

Priority Markets: United States Japan Germany

Emerging Markets: Chile Korea

Other Countries: Poland China Russia Argentina

Priority Markets

In housing export, opportunities have no borders

To support and promote successful housing exports in foreign markets, CMHC has entered the export arena with its export team. A member of Trade Team Canada, CMHC is the housing industry's export partner, providing both strategic advice and practical support.

CMHC's export team works tirelessly to identify priority markets that offer you the best export opportunities. Below are some highlights of these selected markets:

USA

Canada's largest market for housing exports offers considerable growth potential for Canada's housing industry. Over 3.7 million new homes, worth about $70 billion US are forecast to be built by the end of the year 2000. Significant opportunities also exist in the renovation market, worth an estimated $95 billion US, and in the building products market, worth an estimated $100 billion US.

Find out how you can expand into this active and diverse housing market.

Japan

Canada's second largest housing export market offers good long-term prospects. Over 2.2 million new homes will be built by the end of the year 2000. There are many opportunities in niche markets such as housing for older people - Japan has the highest percentage of seniors in the world - Healthy Housing, renovations, quality wood-frame housing construction and traditional Japanese post and beam. Land costs are down 50% in urban areas and building costs have declined from 30 to 50%. Now is the time to keep and expand your market share in Japan.

Germany

Germany is Canada's third largest housing export market and the gateway to new opportunities throughout Europe. Demand for new housing is very high and will likely continue to be strong for another decade. Up to 1.6 million new homes will be built by the year 2000. Success in this market will open doors for you throughout the European Union.

Emerging Markets

Chile

Chile offers excellent long-term potential, particularly for wood and steel-frame technologies. A strong and stable market economy, Chile wants to trade with Canada. More than 400,000 new homes will be built by the year 2000. Canada's success in this country, resulting from its free trade agreement with Chile, will open doors in other Latin American countries as well.

South Korea

South Korea offers significant opportunities for housing investments and joint ventures. Up to 350,000 new homes will be build by the end of the year 2000. Wealthy Koreans favour western-style housing, including wood-frame homes and healthy living environments.

Other Markets

Poland

Poland is another promising housing market and forecasts are for One million new homes to be built by the end of the year 2000. Poland's housing industry is not able to meet this demand alone and needs support from foreign countries. Canada whose housing technologies and products are well received in Poland, is well positioned to capture a greater share of this market.

China

China is the largest housing market in the world with an enormous need for new housing. Up to 4 million new homes will be built annually to the end of the year 2000. This market is highlighted by opportunities in the Northern region of China where Canadian building materials, renovation products and wood-frame and steel-frame technologies are in great demand.

Russia

The housing sector which produces half a million new housing units per year is a major part of the Russian economy. A proactive housing policy has been recognized as a priority for the Russian government

The potential for light-frame construction is enormous due to Russia forest resources and the recent movement away from high rise projects towards single family homes.

Argentina

In Argentina, early indicators reveal that there may be potential for Canadian involvement in the areas of mid-to-premium priced steel frame construction prefabricated housing, housing finance systems and recreational developments.

CMHC- Canada Mortgage and Housing Corporation

"the federal government's housing agency, is responsible for administering the National Housing", formerly the Central Mortgage and Housing Corporation