Canadian Housing Starts Trend Decreases in December

OTTAWA, Jan. 9, 2019 /CNW/ - The trend in housing starts was 206,981 units in December 2018, compared to 212,338 units in November 2018, 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)

Logo: Government of Canada (CNW Group/Canada Mortgage and Housing Corporation)

"The national trend in housing starts decreased in December, the fifth decline in the last six months," said Bob Dugan, CMHC's chief economist. "Reflecting these recent declines, total annual housing starts in 2018 were lower than in 2017, as lower single-detached starts more than offset a slight increase in multi-family starts this year. Nonetheless, total housing starts remain elevated when compared to historical averages."

Monthly Highlights

Vancouver
Housing starts in the Vancouver Census Metropolitan Area (CMA) continued trending lower in December 2018, ending the year with an 11% decrease compared to 2017 despite that rental units rose by 40% in response to a tight rental market. City of Vancouver's rental and condo sectors are the top two drivers to the annual housing starts. Surrey led the overall decline with housing starts down by 27% in 2018.

Victoria
Total year-to-date housing starts initiated in Metro Victoria reached a level not seen since 1976 in December. Rental units were half of all housing starts in 2018 in response to heightened rental demand and low vacancy rates.

Edmonton
Edmonton housing starts trended lower in December as inventory levels remained elevated. On an annual basis, Edmonton starts were 12% below 2017 levels, which reflects lower demand driven by the current economic climate in Alberta. Starts for all types of units were lower, except for row units, which grew by 13%.

Regina
December total housing starts trended lower due to a decline in multi-family construction. In 2018, housing starts in the Regina CMA declined by 41% to 1,139 units from 1,923 in 2017. Single-detached starts declined by 47%, while multi-family starts were lower by 37%, compared to the previous year. A weak labour market, tighter credit market conditions, rising construction costs and elevated resale supply - all combined to reduce demand for newly constructed homes.

Kingston
Kingston recorded the highest number of starts in any given month since September 2013. Rental apartments accounted for 77% of total starts in December. These new rental units will contribute needed supply to the market, as the apartment vacancy rate in Kingston has been trending lower since 2016. The total number of housing starts in 2018 was significantly above the 5-year average, with gains for all dwelling types.

Toronto
In 2018, the Toronto CMA saw the most apartment starts ever recorded and overall housing starts were up 6% from a year ago. High prices, borrowing costs, and a widening price gap with resale market alternatives weighed down significantly on single-detached starts, which were the lowest in almost four decades. The deteriorating affordability for low-rise homes has fueled the demand for relatively affordable higher-density housing.

Hamilton
Annual housing starts in Hamilton CMA were the highest since 2004, despite the trend measure moving down in December. Apartment starts were primarily responsible for the high number of overall housing starts in 2018, having reached their highest level in over 40 years. In 2018, more buyers gravitated to less expensive homes and competition for vacant rental units intensified, both of which led to greater demand for new apartments. The appetite for new apartments was widespread across Hamilton CMA in 2018, occurring in each of three major markets, Burlington, Hamilton and Grimsby.

Brantford
A high number of housing starts for December helped annual starts to surpass the 700 mark for just the second time in the past ten years. The price point of new low-rise homes in Brantford attracted more growing families and empty nesters from nearby Hamilton and West GTA markets compared to most years. Single-detached starts rebounded from a slow 2017, while row starts continued to trend up to their highest level since CMHC began tracking starts activity in Brantford over 40 years ago.

Montréal
Housing starts in the Montréal area increased slightly in 2018 compared to 2017 (+1%). The decline recorded in the construction of condos (-6%) during this period was more than offset by rental apartment starts (+8%) which hit a 30-year record high. Just under half of all housing starts in the Montreal CMA in 2018 were intended for the rental market, including starts of rental retirement homes. However, most rental starts were intended for the larger non-retirement home sector. Relatively low vacancy rates, the aging population, and stronger demand from young households were likely all factors that stimulated residential construction in the rental market segment.

Province of Québec
The total number of housing starts in Quebec's urban areas in 2018 was practically the same as in 2017. Residential construction in the past year continued to be supported by multi-unit housing starts, a large part of which were rental housing units. This was the case notably in Montréal and Québec. Overall, the growth in the supply of apartments in the province was stimulated by the aging of the population and by immigration.

Halifax
Total housing starts in Halifax picked up pace in December due to a rise in apartment construction. By year-end 2018, multiples starts were up 6% compared to 2017 figures, driven by strong rental demand and migration. Apartment construction in 2018 was predominantly located in the suburban markets of Hammonds Plains and Mainland North, as well as on the Halifax Peninsula.

Prince Edward Island (PEI)
Total housing starts in PEI were 156% higher in December compared to a year ago. Singles were up by 9% and multiples by 347%, which contributed directly to the considerable monthly increase. This was driven by new multi-unit apartment and seniors' condo projects, in reaction to a near zero vacancy rate on the Island. For 2018, total starts were up 26%, driven primarily by strong job growth and positive international immigration throughout the year. 

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 213,419 units in December, down from 224,349 units in November. The SAAR of urban starts decreased by 5.8% in December to 194,594 units. Multiple urban starts decreased by 6.8% to 144,728 units in December while single-detached urban starts decreased by 2.6% to 49,866 units.

Rural starts were estimated at a seasonally adjusted annual rate of 18,825 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.

For more information, follow us on Twitter, YouTube, LinkedIn, Facebook and Instagram.

Preliminary Housing Start Data in Centres 10,000 Population and Over
		Single-Detached			All Others			Total
		December 2017	December 2018	%	December 2017	December 2018	%	December 2017	December 2018	%
Provinces (10,000+)
N.-L.		77	39	-49	56	18	-68	133	57	-57
P.E.I.		22	24	9	17	76	347	39	100	156
N.S.		109	125	15	167	269	61	276	394	43
N.B.		60	52	-13	103	123	19	163	175	7
Atlantic		268	240	-10	343	486	42	611	726	19
Qc		542	472	-13	4,101	4,152	1	4,643	4,624	0
Ont.		2,103	1,657	-21	2,938	3,992	36	5,041	5,649	12
Man.		223	144	-35	351	297	-15	574	441	-23
Sask.		121	104	-14	194	37	-81	315	141	-55
Alta.		984	697	-29	703	734	4	1,687	1,431	-15
Prairies		1,328	945	-29	1,248	1,068	-14	2,576	2,013	-22
B.C.		843	725	-14	3,169	3,216	1	4,012	3,941	-2
Canada (10,000+)		5,084	4,039	-21	11,799	12,914	9	16,883	16,953	0
Metropolitan Areas
Abbotsford-Mission		26	33	27	13	258	##	39	291	##
Barrie		28	13	-54	43	0	-100	71	13	-82
Belleville		37	27	-27	67	4	-94	104	31	-70
Brantford		11	10	-9	2	62	##	13	72	454
Calgary		349	223	-36	334	307	-8	683	530	-22
Edmonton		412	332	-19	305	306	0	717	638	-11
Greater Sudbury		6	8	33	4	4	-	10	12	20
Guelph		30	14	-53	80	153	91	110	167	52
Halifax		89	63	-29	166	237	43	255	300	18
Hamilton		59	15	-75	268	119	-56	327	134	-59
Kelowna		84	65	-23	177	219	24	261	284	9
Kingston		55	25	-55	17	213	##	72	238	231
Kitchener-Cambridge-Waterloo		57	79	39	138	75	-46	195	154	-21
Lethbridge		45	33	-27	22	12	-45	67	45	-33
London		150	103	-31	52	33	-37	202	136	-33
Moncton		13	9	-31	35	105	200	48	114	138
Montréal		232	165	-29	3,151	2,741	-13	3,383	2,906	-14
Oshawa		117	63	-46	18	54	200	135	117	-13
Ottawa-Gatineau		308	260	-16	599	298	-50	907	558	-38
	Gatineau	48	51	6	48	40	-17	96	91	-5
	Ottawa	260	209	-20	551	258	-53	811	467	-42
Peterborough		32	23	-28	24	13	-46	56	36	-36
Québec		52	29	-44	390	652	67	442	681	54
Regina		29	24	-17	35	17	-51	64	41	-36
Saguenay		16	13	-19	30	31	3	46	44	-4
St. Catharines-Niagara		152	66	-57	26	145	458	178	211	19
Saint John		12	21	75	26	1	-96	38	22	-42
St. John's		62	30	-52	39	15	-62	101	45	-55
Saskatoon		76	74	-3	144	14	-90	220	88	-60
Sherbrooke		32	25	-22	52	41	-21	84	66	-21
Thunder Bay		3	6	100	0	0	-	3	6	100
Toronto		767	540	-30	1,473	2,654	80	2,240	3,194	43
Trois-Rivières		12	16	33	45	82	82	57	98	72
Vancouver		402	375	-7	2,306	1,637	-29	2,708	2,012	-26
Victoria		70	43	-39	134	732	446	204	775	280
Windsor		35	45	29	2	8	300	37	53	43
Winnipeg		181	119	-34	322	210	-35	503	329	-35
Total		4,041	2,989	-26	10,539	11,452	9	14,580	14,441	-1
Data for 2017 based on 2016 Census Definitions.
Data for 2018 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
		November 2018	December 2018	%	November 2018	December 2018	%	November 2018	December 2018	%
Provinces (10,000+)
N.L.		510	394	-23	206	222	8	716	616	-14
P.E.I.		302	374	24	1,536	912	-41	1,838	1,286	-30
N.S.		1,227	1,325	8	1,819	3,223	77	3,046	4,548	49
N.B.		679	640	-6	1,769	1,740	-2	2,448	2,380	-3
Qc		6,505	6,026	-7	36,039	38,383	7	42,544	44,409	4
Ont.		19,751	19,099	-3	63,116	48,689	-23	82,867	67,788	-18
Man.		2,408	2,179	-10	6,372	3,564	-44	8,780	5,743	-35
Sask.		1,193	1,330	11	744	444	-40	1,937	1,774	-8
Alta.		9,266	8,812	-5	15,469	9,121	-41	24,735	17,933	-27
B.C.		9,354	9,687	4	28,263	38,430	36	37,617	48,117	28
Canada (10,000+)		51,195	49,866	-3	155,333	144,728	-7	206,528	194,594	-6
Canada (All Areas)		64,246	63,650	-1	160,102	149,768	-6	224,349	213,419	-5
Metropolitan Areas
Abbotsford-Mission		314	412	31	324	3,096	##	638	3,508	450
Barrie		187	253	35	24	0	-100	211	253	20
Belleville		441	326	-26	240	48	-80	681	374	-45
Brantford		446	187	-58	1,308	744	-43	1,754	931	-47
Calgary		3,250	2,876	-12	6,444	3,684	-43	9,694	6,560	-32
Edmonton		4,039	4,056	0	7,488	3,672	-51	11,527	7,728	-33
Greater Sudbury		108	117	8	24	48	100	132	165	25
Guelph		264	196	-26	912	1,836	101	1,176	2,032	73
Halifax		831	626	-25	1,140	2,844	149	1,971	3,470	76
Hamilton		437	193	-56	1,824	1,428	-22	2,261	1,621	-28
Kelowna		600	661	10	3,660	2,628	-28	4,260	3,289	-23
Kingston		336	286	-15	336	2,556	##	672	2,842	323
Kitchener-Cambridge-Waterloo		910	939	3	2,736	900	-67	3,646	1,839	-50
Lethbridge		269	311	16	108	144	33	377	455	21
London		1,390	1,421	2	1,368	396	-71	2,758	1,817	-34
Moncton		202	149	-26	1,320	1,260	-5	1,522	1,409	-7
Montréal		2,701	2,283	-15	26,356	32,750	24	29,057	35,033	21
Oshawa		1,163	904	-22	3,360	648	-81	4,523	1,552	-66
Ottawa-Gatineau		2,961	2,626	-11	7,008	3,576	-49	9,969	6,202	-38
	Gatineau	393	526	34	2,772	480	-83	3,165	1,006	-68
	Ottawa	2,568	2,100	-18	4,236	3,096	-27	6,804	5,196	-24
Peterborough		307	274	-11	0	156	##	307	430	40
Québec		938	463	-51	5,712	7,824	37	6,650	8,287	25
Regina		201	344	71	312	204	-35	513	548	7
Saguenay		188	168	-11	168	372	121	356	540	52
St. Catharines-Niagara		554	706	27	792	1,740	120	1,346	2,446	82
Saint John		226	248	10	72	12	-83	298	260	-13
St. John's		422	290	-31	180	180	-	602	470	-22
Saskatoon		891	869	-2	384	168	-56	1,275	1,037	-19
Sherbrooke		235	358	52	1,656	492	-70	1,891	850	-55
Thunder Bay		99	169	71	180	0	-100	279	169	-39
Toronto		5,417	5,510	2	42,816	31,848	-26	48,233	37,358	-23
Trois-Rivières		217	193	-11	600	984	64	817	1,177	44
Vancouver		4,873	5,125	5	17,232	19,644	14	22,105	24,769	12
Victoria		709	699	-1	2,244	8,784	291	2,953	9,483	221
Windsor		638	686	8	984	96	-90	1,622	782	-52
Winnipeg		2,172	1,852	-15	5,112	2,520	-51	7,284	4,372	-40
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]

Related Links

www.cmhc-schl.gc.ca