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News » Canada » Housing starts decrease » published 13 Oct 2017

Housing starts decrease

The number of housing starts fell in September compared to August according to latest data from the Canada Mortgage & Housing Corporation (CMHC).

The trend in housing starts was 214,821 units in September 2017, down from 220,573 units in August 2017. The trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts. It is used as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates.

“Housing starts are trending lower in September after increasing for eight consecutive months,” said Bob Dugan, CMHC’s chief economist. “Nevertheless, new home construction remains very strong as the seasonally adjusted number of starts was above 200,000 units for four straight months.”

In St John’s, drivers such as population, income and employment have put downward pressure on new home construction activity. Total housing starts fell 34% in September compared to the prior year. Single-detached starts declined 33%, while multiple starts declined 42%.

Tightness in the Prince Edward Island resale sector continues to cause demand to spill over into the  new home market. Starts of single-detached homes were up 93% year-to-date in September, with most of the activity concentrated in the Charlottetown area. Record high levels of international migration continue to support starts of multi-family dwellings, which were up 16% year-to-date.

The third quarter of 2017 saw the annual rate of housing starts for the Quebec reached 43,736 units, up from the level registered for the previous quarter (40,564 units). Results were attributable to the strong momentum observed in the multi-unit housing segment, particularly in the case of rental apartments, for which starts remained significant in the Montréal and Québec areas.

Homebuilders broke ground on fewer homes in the Toronto Census Metropolitan Area (CMA) during September 2017. Total housing starts trended lower by 7% in September from the previous month, led by lower apartment starts. Monthly variations in high-rise starts are typical given delays in getting large projects off the ground. Low-rise starts remained strong. The overall pace of new home construction remains stable as strong demand for new homes in the Toronto CMA continues to persist.

In Saskatoon, total housing starts trended lower in September after production of both single-detached and multi-family units slowed. While the pace of construction in the singles sector has been on par with last year, multi-family construction was down 30% after nine months this year.

Housing starts in the Vancouver CMA trended downwards in September as fewer multi-family home projects got under way. The high level of housing starts over the past year has led to a record number of units being under construction in the region, leaving little spare capacity to start additional projects. New home construction in the Vancouver CMA is being supported by population growth, a strong local economy, and low financing costs.

 

MPU

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This article was published on 13 Oct 2017 (last updated on 13 Oct 2017).

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