Market Overview

Canadian Housing Starts Trend Steady in October

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OTTAWA, Nov. 8, 2017 /CNW/ - The trend in housing starts was 216,770 units in October 2017, compared to 215,153 units in September 2017, according to Canada Mortgage and Housing Corporation (CMHC). This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

Bob Dugan, Chief Economist, CMHC (CNW Group/Canada Mortgage and Housing Corporation)

"The trend in housing starts essentially held steady in October following a decrease in September," said Bob Dugan, CMHC's chief economist. "Nevertheless, new home construction remains very strong in 2017, as the seasonally adjusted number of starts has been above 200,000 units in nine of ten months so far this year."

Monthly Highlights

New Brunswick
After four years of declining construction activity, population growth has helped push New Brunswick's housing starts up 28% year-to-date. Starts have been strong across the province, with much of the activity concentrated in the Moncton Census Metropolitan Area (CMA). Multifamily starts have been particularly strong in the hub city, up 49% year-to-date.

Montréal
In the Montréal area, this past month saw the highest level ever recorded of residential construction for the month of October, with close to 3,500 housing units started—half of them on the Island of Montréal. Once again in 2017, condominium and rental housing construction has driven the growth. The decrease in inventories of completed and unsold condominiums and the low vacancy rates in newer rental buildings seem to have prompted developers to ramp up on construction projects this year.

Ottawa
Low-rise housing starts trended higher in October supported by improved employment and earnings this year. This increase was just enough to offset the effect of the sharp decline in apartment starts this month. To October, housing starts were 27% higher than their level in 2016. The rise in starts so far this year was mostly driven by a doubling in apartment starts following three years of declining high-rise construction in the CMA as the number of completed and unsold condominiums has trended down considerably since peaking in mid-2016.

Thunder Bay
October housing starts in Thunder Bay trended at their highest level in three years due primarily to a continued increase in the trend for multiples starts. Downsizing senior households, international post-secondary students and in-migrants to the CMA drawn in by an improving service sector have all been supportive of apartment starts this year. Conversely, the trend for single detached starts has remained mostly flat owing to more affordable alternatives in the resale market.

Toronto
Total housing starts in the CMA trended lower in October 2017, with the most pronounced declines occurring in single-detached home and apartment starts. Lower trending single-detached home starts are reflective of fewer sales of pre-construction units through 2016 and spring of 2017. Sales of pre-construction condominium apartment units have been brisk over the past couple of years and these units continue to start construction with varying levels of intensity each month.

London
Total housing starts in the London CMA were down significantly in October 2017 compared to October 2016, due to a high number of apartments started last October. However, single-detached starts in London CMA posted the highest levels for the month of October since 2007. Strong population growth and a low supply of resale home listings have strengthened demand for new single-detached homes – encouraging builders to continue to keep single-detached starts elevated over recent months.

Windsor
Multi-unit housing starts in the Windsor CMA posted the highest levels for the month of October since 2004, while single-detached starts trended lower for a second consecutive month. Slightly lower demand in the resale market evidenced by a declining sales-to-new listings ratio has discouraged builders from keeping single-detached starts as high as they were early in the summer. Also, Windsor's growing population of seniors has strengthened demand for multi-unit starts, as seniors have a higher propensity to downsize to apartment units and semi-detached homes as they age.

Calgary
While labour market conditions and housing demand have improved this year, the trend in total housing starts has been slowing down over the last couple of months. A rise in active listings in the competing resale market combined with elevated inventories in the new home market, especially for apartments, have impacted new home construction. Despite the decline in the trend, total actual housing starts to the end of October were still up 24% compared to the same period a year earlier.

Vancouver
Starts trended higher in the Vancouver CMA in October, with seasonally adjusted monthly starts reaching a 12-month high. The increase was primarily driven by a significant uptick in condominium apartment starts in Burnaby, Coquitlam and Surrey, where the demand is strong for more affordable multi-family dwellings. Year-to-date starts remain below 2016 levels, mostly due to fewer projects getting underway in the City of Vancouver and on the North Shore this year.

CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of Canada's housing market. In some situations analyzing only SAAR data can be misleading, as they are largely driven by the multi-unit segment of the market which can vary significantly from one month to the next.

The standalone monthly SAAR of housing starts for all areas in Canada was 222,771 units in October, up from 219,293 units in September. The SAAR of urban starts increased by 2.5 per cent in October to 205,935 units. Multiple urban starts increased by 12.5 per cent to 149,593 units in October. Single-detached urban starts decreased by 17.1 per cent, to 56,342 units.

Rural starts were estimated at a seasonally adjusted annual rate of 16,836 units.

Preliminary Housing Starts data are also available in English and French through our website and through CMHC's Housing Market Information Portal. Our analysts are also available to provide further insight into their respective markets.

As Canada's authority on housing, CMHC contributes to the stability of the housing market and financial system, provides support for Canadians in housing need, and offers objective housing research and information to Canadian governments, consumers and the housing industry.

For more information, follow us on Twitter, YouTube, LinkedIn and Facebook.

October Housing Starts in Canada - All Areas (CNW Group/Canada Mortgage and Housing Corporation)

 

Preliminary Housing Start Data in Centres 10,000 Population and Over


Single-Detached

All Others

Total



October
2016

October
2017

%

October
2016

October
2017

%

October
2016

October
2017

%

Provinces (10,000+)

N.-L.

71

51

-28

38

46

21

109

97

-11

P.E.I.   

10

35

250

4

21

425

14

56

300

N.S.   

93

117

26

227

97

-57

320

214

-33

N.B.   

54

71

31

93

174

87

147

245

67

Atlantic

228

274

20

362

338

-7

590

612

4

Qc

641

576

-10

2,116

4,028

90

2,757

4,604

67

Ont.   

2,670

2,026

-24

4,650

3,136

-33

7,320

5,162

-29

Man.   

219

215

-2

159

164

3

378

379

0

Sask.   

180

166

-8

160

281

76

340

447

31

Alta.   

927

1,057

14

1,137

1,317

16

2,064

2,374

15

Prairies

1,326

1,438

8

1,456

1,762

21

2,782

3,200

15

B.C.   

887

830

-6

1,245

3,681

196

2,132

4,511

112

Canada (10,000+)

5,752

5,144

-11

9,829

12,945

32

15,581

18,089

16

Metropolitan Areas

Abbotsford-Mission

37

25

-32

143

95

-34

180

120

-33

Barrie

70

75

7

50

50

-

120

125

4

Belleville

**

37

##

**

23

##

**

60

##

Brantford

11

12

9

12

0

-100

23

12

-48

Calgary

334

385

15

293

568

94

627

953

52

Edmonton

413

413

-

763

397

-48

1,176

810

-31

Greater Sudbury

16

9

-44

16

4

-75

32

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