Canadian Housing Starts Trend Stable in December

  1/9/2018 |   SHARE
Posted in Canadian Housing Market by Michael Antczak| Back to Main Blog Page

CMHC News

The trend in housing starts was 226,777 units in December 2017, compared to 226,178 units in November 2017, 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.

"Despite the variation in activity across the country, the national trend in housing starts held steady at its highest level since 2008," said Bob Dugan, CMHC's chief economist. "Total urban housing starts in 2017 were up 6.2% compared to 2016 due to the rise in apartment construction."

Monthly Highlights

Victoria
Metro Victoria finished 2017 with historically high housing starts. Multi-family structures accounted for the majority of housing starts, with elevated rental market starts pushing the total starts to its highest level since 1976. December of 2017 reflected this trend, with a 70% increase in multi-family starts compared to the previous year. Metro Victoria'shousing market showed strong price growth and overheating throughout the year, giving builders and developers strong incentive to break ground on new projects.

Vancouver
Total housing starts in the Vancouver CMA increased in December 2017 compared to the previous month after posting one of the highest levels of monthly multi-family starts for the year. In particular, apartment condominium starts were elevated in Vancouver, Richmond and Coquitlam;as low inventories on the resale market continue to encourage new development. Although total starts in 2017 were lower than 2016 due to constraints in construction labour and equipment, new home construction remained strong from a historical point-of-view due to continued demand for housing.

Calgary
The trend in total housing starts declined in December 2017 as the pace of single-detached and multiple construction decreased compared to the previous month. Despite the decline in the trend, total actual housing starts for 2017 were up 25% year-over-year. The housing market in Calgary has been recovering from the economic slowdown. Consumer confidence and labour market conditions have improved while the population continued to increase. This has helped support demand for new housing.

Winnipeg
In the Winnipeg CMA, the moderating trend in total starts observed over the last half of 2017 ended in December with both single-family and multi-family experiencing gains compared to the previous month. On a year-over-year basis, total actual housing starts more than doubled this December compared to December 2016 with the multi-family sector leading this increase, particularly new apartment projects. Single-detached starts also saw strong year-over-year growth. December rounds out the strongest year of new housing activity in Winnipeg recorded by CMHC. A background of stable employment, wage growth and last year's record in-migration has supported the market. In addition, the introduction of an impact fee in Winnipeg contributed to an acceleration in housing starts in the city during the first half of 2017.

Belleville
Belleville builders started 104 homes in December, the highest number of starts in any given month since February 2009. Half of the total starts were rental apartments. These new rental units will contribute needed supply to the market, as the apartment vacancy rate in Belleville has been trending lower since 2013, falling to 2.2% in 2017. The total number of housing starts in 2017 was the highest since 1990, driven up by the rise in single-detached and apartment starts.

Greater Sudbury
There were 10 new homes started in the Greater Sudbury Census Metropolitan Area in December bringing the total number of new home starts in 2017 to 195; the lowest number of annual starts since 2001. The underwhelming year in starts was attributable to poor employment prospects faced by younger groups aged 15 to 44 and the resultant net out-migration from these groups. Competition from a balanced resale market was a further limitation to new home construction in 2017.

Ottawa
Total starts in the Ottawa CMA were at their highest level since 2009 for the month of December, driven mainly by purpose-built rental apartment starts. For the year, apartment starts were evenly split between purpose-built rentals and condominiums, and came in at more than double last years' number. Just shy of 7,500 units, Ottawa total starts were at their highest level since 2002. Strong economic and demographic fundamentals boosted the demand in 2017, encouraging builders to increase construction activity.

Toronto
Overall, the pace of new home construction in the Toronto Census Metropolitan Area (CMA) remained virtually unchanged in 2017. Close to 39,000 homes broke ground this year, down 0.7% from 2016. Strong demand for new homes continued to be supported by improved employment conditions and strong migration. However, affordability challenges, tighter mortgage rules, increasing price gap with resale market alternatives, and a better-supplied resale market weighed on single-detached starts, which were down by 14% compared to 2016. Given escalating house prices, more homebuyers continued to shift their demand towards relatively more affordable housing options such as townhouses, and more affordable areas such as Brampton. Condominium apartment starts were down by 5% compared to 2016, nevertheless they continued to dominate new home construction thanks to strong demand from price-sensitive homebuyers and investors.

Québec City
Residential construction in the Québec area was strong in 2017. In all, 6,640 housing starts were recorded, for a gain of 39% over 2016. This hike was attributable to the start of several large apartment projects throughout the year. In particular, conventional rental housing construction maintained a historically high pace, with over 2,500 units started. As well, the seniors' housing segment stood out with a record level of 1,334 new units. The strong labour market and the needs and preferences of older households seem to have stimulated demand for apartments in the area, but caution should be exercised as the rapidly rising supply could outpace this demand.

Montréal
The Montréal CMA ended the year with 24,756 housing starts—a high level compared to recent years. Of this number, some 19,400 were for apartments (rental and condominium), a level not seen since the end of the 1980s. This jump can be explained by several factors: the decrease in inventories of new and existing condominiums for sale on the market, urban densification, and the drop in the vacancy rate on the Montréal rental market.

Halifax
December housing starts trended higher in Halifax in both the single-detached and multiples markets. After slowing for three consecutive years, single-detached starts began to pick up pace in 2016 and continued on that upward trend throughout 2017, recording growth of 30% by year-end. Despite this uptick in single-detached construction, demand for rental accommodations supported by a declining vacancy rate continues to dominate the residential construction market in Halifax with over 2,000 multiples units breaking ground in 2017, up 16% compared to 2016.

Prince Edward Island (PEI)
Prince Edward Island's strong construction season has extended well into December. Strong immigration over the past few years has fueled housing demand in the province of PEI, primarily in the Charlottetown area. This has helped to push single-detached starts up to their highest level since 2008. In all, starts were up 70% year-over-year in 2017.      

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 216,980 units in December, down from 251,675 units in November. The SAAR of urban starts decreased by 15.1% in December to 198,132 units. Multiple urban starts decreased by 22% to 135,176 units in December. Single-detached urban starts increased by 4.7% to 62,956 units.

Rural starts were estimated at a seasonally adjusted annual rate of 18,848 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.

 

Preliminary Housing Start Data in Centres 10,000 Population and Over

   

Single-Detached

All Others

Total

   
   

December
2016

December
2017

%

December
2016

December
2017

%

December
2016

December
2017

%

Provinces (10,000+)

N.-L.

 

70

77

10

18

56

211

88

133

51

P.E.I.   

 

7

22

214

6

17

183

13

39

200

N.S.   

 

117

110

-6

111

167

50

228

277

21

N.B.   

 

47

60

28

52

103

98

99

163

65

Atlantic

 

241

269

12

187

343

83

428

612

43

Qc

 

536

542

1

2,645

4,101

55

3,181

4,643

46

Ont.   

 

2,638

2,091

-21

3,789

2,858

-25

6,427

4,949

-23

Man.   

 

143

223

56

110

351

219

253

574

127

Sask.   

 

154

121

-21

174

194

11

328

315

-4

Alta.   

 

909

984

8

1,054

703

-33

1,963

1,687

-14

Prairies

 

1,206

1,328

10

1,338

1,248

-7

2,544

2,576

1

B.C.   

 

696

843

21

2,476

3,169

28

3,172

4,012

26

Canada (10,000+)

5,317

5,073

-5

10,435

11,719

12

15,752

16,792

7

Metropolitan Areas

Abbotsford-Mission

39

26

-33

27

13

-52

66

39

-41

Barrie

 

36

28

-22

0

43

##

36

71

97

Belleville

 

**

37

##

**

67

##

**

104

##

Brantford

 

11

11

-

10

2

-80

21

13

-38

Calgary

 

294

349

19

681

334

-51

975

683

-30

Edmonton

 

409

412

1

303

305

1

712

717

1

Greater Sudbury

14

6

-57

23

4

-83

37

10

-73

Guelph

 

17

18

6

17

0

-100

34

18

-47

Halifax

 

64

90

41

92

166

80

156

256

64

Hamilton

 

111

59

-47

655

268

-59

766

327

-57

Kelowna

 

81

84

4

235

177

-25

316

261

-17

Kingston

 

20

55

175

26

17

-35

46

72

57

Kitchener-Cambridge-Waterloo

120

57

-53

669

138

-79

789

195

-75

Lethbridge

 

**

45

##

**

22

##

**

67

##

London

 

112

150

34

81

52

-36

193

202

5

Moncton

 

18

13

-28

8

35

338

26

48

85

Montréal

 

206

232

13

1,696

3,151

86

1,902

3,383

78

Oshawa

 

39

117

200

81

18

-78

120

135

13

Ottawa-Gatineau

281

308

10

417

599

44

698

907

30

  Gatineau

 

67

48

-28

105

48

-54

172

96

-44

  Ottawa

 

214

260

21

312

551

77

526

811

54

Peterborough

 

25

32

28

0

24

##

25

56

124

Québec

 

51

52

2

265

390

47

316

442

40

Regina

 

43

29

-33

111

35

-68

154

64

-58

Saguenay

 

33

16

-52

15

30

100

48

46

-4

St. Catharines-Niagara

114

152

33

19

26

37

133

178

34

Saint John

 

8

12

50

3

26

##

11

38

245

St. John's

 

61

62

2

17

39

129

78

101

29

Saskatoon

 

96

76

-21

46

144

213

142

220

55

Sherbrooke

 

18

32

78

77

52

-32

95

84

-12

Thunder Bay

 

4

3

-25

4

0

-100

8

3

-63

Toronto

 

1,350

767

-43

1,635

1,473

-10

2,985

2,240

-25

Trois-Rivières

 

21

12

-43

75

45

-40

96

57

-41

Vancouver

 

284

402

42

1,870

2,306

23

2,154

2,708

26

Victoria

 

67

70

4

79

134

70

146

204

40

Windsor

 

52

35

-33

39

2

-95

91

37

-59

Winnipeg

 

130

181

39

100

322

222

230

503

119

Total

 

4,229

4,030

-5

9,376

10,459

12

13,605

14,489

6

Data for 2016 based on 2011 Census Definitions.

Data for 2017 based on 2016 Census Definitions.

Source: Market Analysis Centre, CMHC

 

** Belleville and Lethbridge were not metropolitan areas in 2016.

## not calculable/extreme value

 

 

Preliminary Housing Start Data - Seasonally Adjusted at Annual Rates (SAAR)

   

Single-Detached

All Others

Total

   

November
2017

December
2017

%

November
2017

December
2017

%

November
2017

December
2017

%

Provinces (10,000+)

N.L.

 

574

772

34

783

678

-13

1,357

1,450

7

P.E.I.   

 

270

410

52

660

204

-69

930

614

-34

N.S.   

 

703

1,043

48

2,257

2,036

-10

2,960

3,079

4

N.B.   

 

781

776

-1

1,259

1,661

32

2,040

2,437

19

Qc  

 

6,835

6,729

-2

37,785

40,935

8

44,620

47,664

7

Ont.   

 

23,504

24,403

4

70,552

36,515

-48

94,056

60,918

-35

Man.   

 

2,538

3,062

21

3,888

4,212

8

6,426

7,274

13

Sask.   

 

1,526

1,653

8

2,064

2,328

13

3,590

3,981

11

Alta.   

 

11,466

12,402

8

21,095

8,702

-59

32,561

21,104

-35

B.C.   

 

11,933

11,706

-2

32,957

37,905

15

44,890

49,611

11

Canada (10,000+)

60,130

62,956

5

173,300

135,176

-22

233,430

198,132

-15

Canada (All Areas)

73,999

77,693

5

177,675

139,286

-22

251,675

216,980

-14

Metropolitan Areas

Abbotsford-Mission

695

424

-39

1,344

156

-88

2,039

580

-72

Barrie

 

956

525

-45

876

516

-41

1,832

1,041

-43

Belleville

 

483

402

-17

216

804

272

699

1,206

73

Brantford

 

139

137

-1

24

24

-

163

161

-1

Calgary

 

4,197

4,206

0

13,368

4,008

-70

17,565

8,214

-53

Edmonton

 

4,418

5,432

23

6,312

3,660

-42

10,730

9,092

-15

Greater Sudbury

156

85

-46

72

48

-33

228

133

-42

Guelph

 

270

319

18

3,000

0

-100

3,270

319

-90

Halifax

 

666

957

44

2,052

1,992

-3

2,718

2,949

8

Hamilton

 

763

782

2

4,392

3,216

-27

5,155

3,998

-22

Kelowna

 

854

934

9

1,740

2,124

22

2,594

3,058

18

Kingston

 

93

581

##

132

204

55

225

785

249

Kitchener-Cambridge-Waterloo

935

829

-11

6,840

1,656

-76

7,775

2,485

-68

Lethbridge

 

455

429

-6

72

264

267

527

693

31

London

 

1,879

2,116

13

5,736

624

-89

7,615

2,740

-64

Moncton

 

187

183

-2

1,092

420

-62

1,279

603

-53

Montréal

 

2,802

2,885

3

22,993

37,492

63

25,795

40,377

57

Oshawa

 

1,502

1,554

3

2,256

216

-90

3,758

1,770

-53

Ottawa-Gatineau

2,766

3,427

24

9,444

7,188

-24

12,210

10,615

-13

  Gatineau

 

500

667

33

396

576

45

896

1,243

39

  Ottawa

 

2,266

2,760

22

9,048

6,612

-27

11,314

9,372

-17

Peterborough

197

371

88

0

288

##

197

659

235

Québec

 

729

688

-6

11,700

4,680

-60

12,429

5,368

-57

Regina

 

396

419

6

1,224

420

-66

1,620

839

-48

Saguenay

 

244

229

-6

492

360

-27

736

589

-20

St. Catharines-Niagara

1,199

1,561

30

1,584

312

-80

2,783

1,873

-33

Saint John

 

261

146

-44

24

312

##

285

458

61

St. John's

 

402

580

44

624

468

-25

1,026

1,048

2

Saskatoon

 

893

1,005

13

720

1,728

140

1,613

2,733

69

Sherbrooke

 

260

391

50

1,560

624

-60

1,820

1,015

-44

Thunder Bay

 

148

65

-56

144

0

-100

292

65

-78

Toronto

 

8,907

8,224

-8

36,168

17,676

-51

45,075

25,900

-43

Trois-Rivières

173

143

-17

420

540

29

593

683

15

Vancouver

 

6,128

5,876

-4

24,864

27,672

11

30,992

33,548

8

Victoria

 

836

1,075

29

1,344

1,608

20

2,180

2,683

23

Windsor

 

568

518

-9

1,152

24

-98

1,720

542

-68

Winnipeg

 

1,897

2,559

35

3,492

3,864

11

5,389

6,423

19

Data based on 2016 Census Definitions.

Source: Market Analysis Centre, CMHC

## not calculable / extreme value

--------------------------------------------------

Source: Canada Mortgage and Housing Corporation



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