Housing starts rate down, but trend pushes higher in November
By Adam FreillConstruction Residential
Despite the rolling trend line inching higher in November, CMHC reports that starts are on the decline due to drop in multi-unit segment.
The six-month trend in housing starts was higher in November at 257,777 units, up 0.7 per cent from 255,876 units in October, according to the latest figures from Canada Mortgage and Housing Corporation (CMHC). The trend measure is a six-month moving average of the monthly seasonally adjusted annual rate (SAAR) of total housing starts for all areas in Canada.
Despite the rise in the trend line, the monthly SAAR of total housing starts for all areas in Canada decreased 22 per cent for the month, coming in at 212,624 units, and well off October’s 272,264 units.
The decline was led by the monthly SAAR of total urban housing starts, which decreased 23 per cent to land at 195,363 units recorded. Multi-unit urban starts decreased 27 per cent to 151,297 units, while single-detached urban starts decreased 7 per cent to 44,066 units.
Cities feeling the pinch in total SAAR housing starts included Montreal, down 30 per cent, and Toronto and Vancouver, which both experienced drops of 39 per cent, as significant declines in multi-unit starts impacted major centres.
“The notable drop in the rate of housing starts in November, particularly in the multi-unit space, should not come as a major surprise and reflects tighter economic conditions impacting construction timelines,” said Kevin Hughes, CMHC’s deputy chief economist. “As the more difficult borrowing conditions and labour shortages now seem to be showing in the starts numbers, we can expect to see continued slower starts rates in the coming months.”
Actual 2023 year-to-date housing starts were 17 per cent and 31 per cent higher than the same period in 2022 in Toronto and Vancouver, respectively, driven by higher multi-unit starts, but nationally, actual year-to-date housing starts are currently down eight per cent in centres of 10,000 population and over.