Pace of new construction declines
The monthly pace of housing starts across the country dipped in April as Canada’s sluggish current pace of homebuilding showed little sign of improving.
The national housing agency, Canada Mortgage and Housing Corporation (CMHC), said on Wednesday that the seasonally adjusted annual rate ticked 1% lower last month compared with March, coming in at a clip of 240,229 units.
Urban centres with a population of 10,000 or more saw a substantial decline in the actual number of recorded housing starts, falling by 9% on a year-over-year basis as construction began on 18,486 units – down from 20,231 the same time last year.
CMHC said that trend was spurred by a slower pace of multi-unit starts, with a 11% decrease more than offsetting a faster pace of single-detached starts.
April’s muted performance on the housing starts front arrives after a similarly quiet March, which witnessed a 7% decline in the seasonally adjusted annual rate of starts compared with February.
Toronto and Vancouver, traditionally Canada’s two busiest and priciest housing markets, saw actual housing starts plummet in April. Toronto posted a decrease of 38% while Vancouver was down 30% as multi-unit and single-detached starts dropped. Montreal, meanwhile, saw a small decline of 3%.
That trend is unlikely to improve any time soon, according to CMHC chief economist Bob Dugan, with little indication that borrowing costs or interest rates are set to tick lower.
“The multi-unit volatility observed in Toronto, Vancouver, and Montreal in recent months is unsurprising as we continue to see last year’s challenging borrowing conditions reflected in multi-unit housing starts numbers,” he said in remarks accompanying the crown corporation’s press release. “We expect to see continued downward pressure in these large centres.”
