Housing starts holding firm, for now

May 11, 2020

Canadian housing starts maintained a stable pace in April, according to Canada Mortgage and Housing Corp. (CMHC), which noted that if Quebec were excluded due to a partial ban on construction because of the pandemic, April’s housing starts trend would be 155,995—up from a pace of 153,463 a month earlier.
But, this positive trend may not continue because, it “reflects strong growth in multi-family starts in Ontario, Saskatchewan and Manitoba. We expect these provinces to register declines in the near term,” cautioned Bob Dugan, CMHC’s chief economist.
"Outside of Quebec, the national trend in housing starts increased in April, despite the impact of COVID-19 containment measures," said Dugan.
CMHC uses the trend measure as a complement to monthly seasonally adjusted housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of Canada's housing market.
The stand-alone monthly seasonally adjusted average of housing starts for all areas in Canada excluding Quebec saw an increase of 10.8 per cent in April from March. The seasonally adjusted annual rate of urban starts increased by 12.4 per cent in April. Multiple urban starts increased by 35.7 per cent, while single-detached urban starts decreased by 27.1 per cent.
Rural starts were estimated at a seasonally adjusted annual rate of 7,285 units in April, excluding Quebec .
As reported here last week, Moody’s Analytics forecasts that Canadian housing starts will fall to 145,000 annualized units by the end of 2020, compared with a pace of 210,000 in early 2020.