Housing starts dip in January
February 19, 2019
Canada-wide housing starts dropped to an annual pace of 207,000 units in January but a mild month-over-month rise in the resale housing market may indicate a generally stronger year for the residential industry.
The decline in starts from December was less than forecast and above long-term norms, according to Canada Mortgage and Housing Corp. (CMHC).
“After recent declines, the national trend in housing starts held steady in January and remained above historical average,” said Bob Dugan, CMHC’s chief economist, in a release.“While single-detached starts continued to trend lower in January, this was offset by an uptick in the trend for multi-unit dwellings in urban centres.”
CMHC’s data showed the annual pace of urban starts slowed 2.1 per cent in January to 190,912 units as single-detached urban starts fell 10.4 per cent to 44,559 units. The annual pace of multiple-unit projects such as condominiums, apartments and townhouses increased 0.7 per cent to 146,353 units, while rural starts were estimated at a seasonally adjusted annual rate of 17,056 units.
In Toronto, housing starts saw little change, although increasing borrowing costs meant pre-construction sales of new homes remain low. CMHC said they expect this to result in even fewer units breaking ground this year.
A small increase in resales in January, up 3.6 per cent from December gives hope that the market is recovering from the slowest sales pace in six years during 2018.
Actual, not seasonally-adjusted, housing sales were down 4 per cent from a year earlier, according to CREA.