New housing construction data for the month of June from Canada Mortgage and Housing Corporation show greatly increased building activity in some areas of the country, particularly in BC and Ontario, and declines of varying steepness elsewhere. Overall, the number of new homes started in June was up 17% compared to May, with an annualized number of 218,333 units. It was the highest level of home building activity since September, 2015. Toronto and Vancouver accounted for more than one-third (37%) of all new home construction for the month. Construction slowed, however, in the Atlantic provinces and Quebec. In the prairie provinces, new housing starts were up compared to May but down significantly compared to one year ago (30,034 vs 48,288).

Condo construction was the main reason for the increase in activity in Ontario, though builders also started more single detached homes than in recent months. The total annualized rate of new home starts for Ontario in June was 84,740, an increase of 26% compared to May, but an increase of 50% compared to June 2015.

In Toronto, the annualized rate of new home construction was 45,848, the highest since March, and 38% higher that May’s number (33,185). According to CMHC, the increase was mainly due to new condo construction, which accounted for 35,544 of total starts. Single family homes accounted for 22% of new construction, with 10,304 starts in June. That too was the highest level since March. Single-family starts are up 13% in Toronto compared to one year ago.

Several cities in the GTA and areas further from Toronto saw increased construction in June. Housing starts in Oshawa, for example, soared from 2,420 in May to 4,303 in June, largely in response to growing demand from buyers priced out of the Toronto market.

CMHC’s Toronto analyst Dana Senagama commented that the strong new home starts are due to limited supply in the resale market, pushing buyers to purchase from the new homes market. An economist at TD bank, Diana Petramala, suggested that the strong housing report for June could be a sign that builders are beginning to address the much-lamented lack of housing supply in markets like Toronto and Vancouver.

In BC, meanwhile, single-family starts dropped slightly in June, while condo construction increased from 24,000 in May to 38,000 in June.

Canada’s strong home-building activity in June was much greater than expected, according to Reuters. Economists surveyed by Bloomberg had forecast starts of about 190,000 for the month.

CMHC : New Home Construction, Especially Condos Rose Sharply in June by Condo.ca