Canadian housing starts trend decreased in May

OTTAWA, June 10, 2019 /CNW/ - The trend in housing starts was 201,983 units in May 2019, compared to 205,717 units in April 2019, according to Canada Mortgage and Housing Corporation (CMHC). This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

Bob Dugan, Chief Economist, CMHC (CNW Group/Canada Mortgage and Housing Corporation)

Housing Starts in Canada - All Areas (CNW Group/Canada Mortgage and Housing Corporation)

"The national trend in housing starts decreased in May as a result of continuing decline in the trend for single starts as well as a decline in the trend of multi-unit starts that follows gains in this segment in recent months, in urban areas," said Bob Dugan, CMHC's chief economist. "The decrease in the trend of multi-unit starts reflects a decline in the SAAR level of multi-unit activity in May from the unusually elevated level registered in April, which leaves multi-unit SAAR starts closer to its 10-year average."

Monthly Highlights

Vancouver
Vancouver Census Metropolitan Area (CMA) housing starts saw a strong increase in May, with multi-family construction accounting for 90% of total starts for the month. Two thirds of the new units were located in Burnaby, Surrey, and Coquitlam, which together saw a number of condominium and rental apartment projects get underway. So far this year, total housing starts are 10% higher than they were in the same period in 2018 as developers and municipalities move to meet demand from the region's growing population.

Kelowna
Housing starts in the Kelowna CMA declined in May, relative to the same month last year, continuing the downward trend seen in the previous three months. Overall, housing starts were down approximately 44% in the first 5 months of 2019, relative to the same period last year. This downward trend comes on the heels of a slower pace of population growth allowing the existing home market to return to balance conditions.

Calgary
Housing starts trended lower in May after a slight up-tick the month prior. New construction activity in the market remains relatively low as builders continue to adjust to sustained levels of elevated inventory and soft demand.

Edmonton
Housing starts trended lower for all units types except semi-detached which experienced a slight increase in May. The slowdown in starts continued to reflect the amount of unsold inventory on the market, particularly among single-detached units.

Brantford
Overall starts trended down in Brantford due to lower trending single-detached and row starts. However, despite the slowdown, row starts remain at a higher than usual level. New single detached home prices continue to rise, making new rows increasingly appealing to buyers who are looking to purchase an affordable low-rise home.

St. Catharines-Niagara
Total housing starts in the St. Catharines-Niagara CMA trended up to reach a near 30-year high in May. The townhomes sector was a clear leader, where the pace of new construction has accelerated the most, accounting for 40% of total new home construction trend this month. Price weary buyers from more expensive nearby communities continue to fuel demand for new homes in St. Catharines-Niagara.

Toronto
Total housing starts trended lower during May in the Toronto CMA with declines being recorded across all types of homes. High homeownership costs continue to weigh on the demand for single-detached and row houses thus resulting in fewer low-rise home starts. Strong pre-construction sales of condominium apartment units over the past two years will continue to translate into starts over time at a varied pace, despite their starts trending lower in May.

Ottawa
Housing starts trended slightly higher in May because of higher row starts. Year-to-date actual starts are up 14% relative to the same period last year due mainly to a rise in condominium apartment starts while single-detached homes declined. Rising ownership costs are shifting demand toward relatively more affordable dwellings and tight resale market conditions are encouraging builders to increase supply of condominium apartment units. 

Gatineau
From January to May, residential construction in the Gatineau area reached a five-decade record high. This strong increase was attributable mainly to the rise in rental housing starts in the Plateau neighbourhood. The aging of the population and the low vacancy rate have continued to stimulate starts of this type in the Gatineau area.

Montréal
Total housing starts in the Montréal area in the first five months of this year increased compared to the same period last year. This gain was solely attributable to rental housing construction, as condominium and single-family home starts recorded decreases. The low vacancy rates on the conventional rental market and the greater proportion of young households now opting for rental housing have kept stimulating rental housing starts. Seniors' rental apartment construction has also posted strong growth since the beginning of the year.

Halifax
Residential construction in Halifax continues to trend upwards as the total number of housing starts year-to-date increased by 48% compared to the same period last year. While the apartment segment has been dominating the growth in construction so far this year, in May, single-detached starts recorded a strong uptick, expanding by 69% year-over-year. As sales remain elevated in relation to the number of new listings, demand for additional supply is supporting the new home construction market.

Prince Edward Island (PEI)
Total housing starts in PEI were 60% higher in May driven primarily by higher apartment starts in response to the record low vacancy rate. The PEI economy continues to outperform the other Atlantic provinces, driven primarily by increased capital project spending as well as strong population, income and employment growth.

CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of Canada's housing market. In some situations, analyzing only SAAR data can be misleading, as they are largely driven by the multi-unit segment of the market which can vary significantly from one month to the next.

The standalone monthly SAAR of housing starts for all areas in Canada was 202,337 units in May, down 13.3% from 233,410 units in April. The SAAR of urban starts decreased by 14.4% in May to 186,946 units. Multiple urban starts decreased by 18.5% to 141,851 units in May while single-detached urban starts increased by 1.8% to 45,095 units.

Rural starts were estimated at a seasonally adjusted annual rate of 15,391 units.

Preliminary Housing Starts data are also available in English and French through our website and through CMHC's Housing Market Information Portal. Our analysts are also available to provide further insight into their respective markets.

As Canada's authority on housing, CMHC contributes to the stability of the housing market and financial system, provides support for Canadians in housing need, and offers objective housing research and information to Canadian governments, consumers and the housing industry.

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Preliminary Housing Start Data in Centres 10,000 Population and Over
		Single-Detached			All Others			Total
		May 2018	May 2019	%	May 2018	May 2019	%	May 2018	May 2019	%
Provinces (10,000+)
N.-L.		42	37	-12	12	14	17	54	51	-6
P.E.I.		30	23	-23	18	54	200	48	77	60
N.S.		102	113	11	162	147	-9	264	260	-2
N.B.		59	51	-14	89	126	42	148	177	20
Atlantic		233	224	-4	281	341	21	514	565	10
Qc		717	688	-4	2,664	3,468	30	3,381	4,156	23
Ont.		2,273	1,771	-22	2,665	2,766	4	4,938	4,537	-8
Man.		246	196	-20	215	502	133	461	698	51
Sask.		106	93	-12	223	101	-55	329	194	-41
Alta.		1,075	776	-28	1,800	1,015	-44	2,875	1,791	-38
Prairies		1,427	1,065	-25	2,238	1,618	-28	3,665	2,683	-27
B.C.		875	700	-20	2,612	3,835	47	3,487	4,535	30
Canada (10,000+)		5,525	4,448	-19	10,460	12,028	15	15,985	16,476	3
Metropolitan Areas
Abbotsford-Mission		26	47	81	24	110	358	50	157	214
Barrie		65	14	-78	141	13	-91	206	27	-87
Belleville		42	58	38	53	12	-77	95	70	-26
Brantford		53	21	-60	60	5	-92	113	26	-77
Calgary		384	294	-23	1,265	518	-59	1,649	812	-51
Edmonton		511	335	-34	452	260	-42	963	595	-38
Greater Sudbury		4	7	75	8	4	-50	12	11	-8
Guelph		11	31	182	8	16	100	19	47	147
Halifax		45	76	69	137	125	-9	182	201	10
Hamilton		57	40	-30	357	210	-41	414	250	-40
Kelowna		72	38	-47	247	52	-79	319	90	-72
Kingston		30	31	3	20	12	-40	50	43	-14
Kitchener-Cambridge-Waterloo		89	61	-31	87	85	-2	176	146	-17
Lethbridge		41	23	-44	24	12	-50	65	35	-46
London		142	133	-6	43	54	26	185	187	1
Moncton		17	17	-	27	101	274	44	118	168
Montréal		332	284	-14	1,506	1,953	30	1,838	2,237	22
Oshawa		153	243	59	58	152	162	211	395	87
Ottawa-Gatineau		289	279	-3	486	886	82	775	1,165	50
Gatineau		35	42	20	179	465	160	214	507	137
Ottawa		254	237	-7	307	421	37	561	658	17
Peterborough		42	25	-40	24	89	271	66	114	73
Québec		78	94	21	447	669	50	525	763	45
Regina		32	11	-66	69	12	-83	101	23	-77
Saguenay		19	33	74	20	21	5	39	54	38
St. Catharines-Niagara		58	72	24	60	124	107	118	196	66
Saint John		17	16	-6	0	2	##	17	18	6
St. John's		27	26	-4	9	13	44	36	39	8
Saskatoon		66	76	15	144	73	-49	210	149	-29
Sherbrooke		21	26	24	126	93	-26	147	119	-19
Thunder Bay		5	8	60	0	8	##	5	16	220
Toronto		833	371	-55	1,242	1,367	10	2,075	1,738	-16
Trois-Rivières		36	26	-28	30	38	27	66	64	-3
Vancouver		406	334	-18	1,856	3,256	75	2,262	3,590	59
Victoria		93	57	-39	177	142	-20	270	199	-26
Windsor		59	57	-3	36	22	-39	95	79	-17
Winnipeg		192	171	-11	207	486	135	399	657	65
Total		4,347	3,435	-21	9,450	10,995	16	13,797	14,430	5
Data based on 2016 Census Definitions.  Source:  Market Analysis Centre, CMHC ## not calculable / extreme value

Preliminary Housing Start Data - Seasonally Adjusted at Annual Rates (SAAR)
		Single-Detached			All Others			Total
		April 2019	May 2019	%	April 2019	May 2019	%	April 2019	May 2019	%
Provinces (10,000+)
N.L.		303	320	6	43	160	272	346	480	39
P.E.I.		164	185	13	96	648	##	260	833	220
N.S.		1,457	1,289	-12	1,871	1,763	-6	3,328	3,052	-8
N.B.		504	500	-1	1,070	1,247	17	1,574	1,747	11
Qc		6,191	5,983	-3	42,343	40,567	-4	48,534	46,550	-4
Ont.		16,570	17,688	7	67,417	32,053	-52	83,987	49,741	-41
Man.		2,067	2,016	-2	3,636	6,024	66	5,703	8,040	41
Sask.		500	1,070	114	720	1,212	68	1,220	2,282	87
Alta.		8,341	8,712	4	15,854	12,157	-23	24,195	20,869	-14
B.C.		8,203	7,332	-11	41,019	46,020	12	49,222	53,352	8
Canada (10,000+)		44,300	45,095	2	174,069	141,851	-19	218,369	186,946	-14
Canada (All Areas)		55,577	56,374	1	177,834	145,964	-18	233,410	202,337	-13
Metropolitan Areas
Abbotsford-Mission		332	452	36	672	1,320	96	1,004	1,772	76
Barrie		104	103	-1	576	156	-73	680	259	-62
Belleville		339	451	33	72	144	100	411	595	45
Brantford		153	156	2	300	60	-80	453	216	-52
Calgary		2,926	3,329	14	8,412	6,216	-26	11,338	9,545	-16
Edmonton		3,903	3,460	-11	6,552	3,120	-52	10,455	6,580	-37
Greater Sudbury		193	79	-59	0	48	##	193	127	-34
Guelph		233	298	28	96	192	100	329	490	49
Halifax		792	826	4	1,512	1,500	-1	2,304	2,326	1
Hamilton		421	411	-2	5,160	2,520	-51	5,581	2,931	-47
Kelowna		414	401	-3	384	624	63	798	1,025	28
Kingston		268	309	15	312	144	-54	580	453	-22
Kitchener-Cambridge-Waterloo		938	652	-30	13,044	1,020	-92	13,982	1,672	-88
Lethbridge		402	265	-34	96	144	50	498	409	-18
London		1,124	1,351	20	4,176	648	-84	5,300	1,999	-62
Moncton		230	174	-24	936	1,212	29	1,166	1,386	19
Montréal		2,394	2,292	-4	26,909	23,085	-14	29,303	25,377	-13
Oshawa		363	2,545	##	72	1,824	##	435	4,369	##
Ottawa-Gatineau		3,883	3,146	-19	7,536	10,632	41	11,419	13,778	21
Gatineau		754	574	-24	4,380	5,580	27	5,134	6,154	20
Ottawa		3,129	2,572	-18	3,156	5,052	60	6,285	7,624	21
Peterborough		194	210	8	180	1,068	493	374	1,278	242
Québec		646	770	19	3,456	8,028	132	4,102	8,798	114
Regina		156	146	-6	300	144	-52	456	290	-36
Saguenay		129	244	89	144	252	75	273	496	82
St. Catharines-Niagara		1,264	783	-38	2,508	1,488	-41	3,772	2,271	-40
Saint John		89	152	71	0	24	##	89	176	98
St. John's		174	229	32	12	156	##	186	385	107
Saskatoon		429	780	82	264	876	232	693	1,656	139
Sherbrooke		240	316	32	1,200	1,116	-7	1,440	1,432	-1
Thunder Bay		106	101	-5	0	96	##	106	197	86
Toronto		3,011	3,539	18	35,040	16,404	-53	38,051	19,943	-48
Trois-Rivières		203	205	1	468	456	-3	671	661	-1
Vancouver		3,925	3,595	-8	30,288	39,072	29	34,213	42,667	25
Victoria		577	607	5	4,740	1,704	-64	5,317	2,311	-57
Windsor		443	548	24	288	264	-8	731	812	11
Winnipeg		1,705	1,709	0	3,432	5,832	70	5,137	7,541	47
Data based on 2016 Census Definitions. Source:  Market Analysis Centre, CMHC ## not calculable / extreme value

SOURCE Canada Mortgage and Housing Corporation

Angelina Ritacco, Media Relations, CMHC, 416-218-3320, [email protected]

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