The Canada Mortgage and Housing Corporation released its housing starts report, announcing an upward tick in the monthly trend.
Canadian housing starts trended at 208,970 units in July 2019, compared to 205,765 in June. The trend is a six month moving average of seasonally adjusted annual rates (SAAR).
The standalone monthly SAAR of housing starts was 222,013 units, down 9.6% from June. The SAAR of urban starts dropped 10.4% to 209,122 units, with multi-unit starts down 12% to 162,722 and detached starts down 4.6% with 46,400. Rural starts are estimated at 12,891 units.
“The national trend in housing starts increased in July, despite a decrease in the level of SAAR activity from June," says Bob Dugan, CMHC's chief economist. “High levels of activity in apartment and row starts in urban centres in recent months continued to be reflected in the high level of the total starts trend in July.”
In Toronto, housing starts trended lower mostly due to fewer multi-unit starts. That said, CMHC notes that condo sales have been strong recently, so there will likely be many groundbreakings throughout the year. With single-family homes priced so high, there is still a consistent demand for relatively affordable high density housing.
CMHC also highlighted St. Catharines because even with a decrease in starts, the city is still hovering around a 30-year high. With employment improving among those aged 25-44, homebuying activity has increased, especially with townhomes.
In Ottawa, housing starts trended up 5.3% compared to the same period a year ago, mostly due to an increase in condo and townhome construction. CMHC says the low supply in the resale and rental markets, in conjunction with the high detached home prices has amounted to more activity in the preconstruction market, specifically of relatively affordable high density housing.
New home sales picked up steam this spring and summer, so we’re curious to see if any of these projects start construction this year.