Housing starts trending higher

December 13, 2017

Canada-wide housing starts were being built at a brisk pace in November, hitting a seasonally adjusted annualized pace of 252,184 new homes, up from 222,695 a month earlier, reports Canada Mortgage and Housing Corp. (CMHC).
“The trend in housing starts reached its highest level in almost 10 years this November, reflecting a second consecutive increase in multiple starts,” said Bob Dugan, CMHC’s chief economist.
Nationally, multiple-family starts accounted for 175,016 units up 16.9 per cent from October, while single-detached starts were up 7.5 per cent to 60,396 units and rural starts were estimated at 16,772.
While real estate sales in the Greater Toronto Area have fallen year-over-year, Dugan said evidence of overbuilding in Toronto is low “due to the decreasing inventory of completed and unabsorbed multiple units and strong demand.”
Ontario appears on pace for 82,000 starts in 2017, which would be the best level since 2004.
An Ontario highlight is the Kitchener-Cambridge-Waterloo area, where builders started 658 homes in November, significantly higher than the 222 homes started a year ago. Starts for townhouses are up 51 per cent and apartment starts increased 26 per cent. Demographics are playing a role in new condo construction as there has been a shift to smaller households.
A big surprise in the November national data is a 58 per cent drop in Vancouver multi-family starts, compared to a year earlier, despite a very low inventory of new condos and townhouses. Condo prices and sales in the city are surging, according to the Urban Development Institute, which blames the low starts on delays in acquiring city permits.