National Housing Starts are Trending Lower, but Vancouver Reported a 50% Increase M/M

Under Market Updates

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November 23rd, 2021

The number of housing starts across Canada continued to trend downward in October according to new market insights from Canada Mortgage and Housing Corporation (CMHC).

In a report released today, the federal corporation stated that the standalone monthly seasonally adjusted annual rates (SAAR) of housing starts for all areas in Canada was 236,554 units in October. This is a 5.3% drop from September, when there were 249,922 units.

The SAAR for urban starts dipped 3.7% in October to 214,797 units. Multiple urban starts also dropped by 5.3% to 156,781 units, but single-detached urban starts crept up by just 1% to 58,016 units last month.

The trend in national housing starts fell to 264,264 units in October, down from 270,661 units in September. This trend measure is a six-month moving average of the monthly SAAR of housing starts, CMHC explained. To account for swings in monthly estimates and to gain a “more complete picture of Canada’s housing market,” CMHC uses the trend measure to complement the monthly SAAR in starts.

“The six-month trend in housing starts declined from September to October, as the retreat in total starts from their earlier 2021 levels continued,” said Bob Dugan, CMHC’s chief economist, in the report.

“For SAAR housing starts in Canada’s urban areas, a slight increase in single-detached starts didn’t offset a larger decrease in multi-family starts in October and led to a decline in overall starts for the month,” he added.

On a trend and monthly SAAR basis, Dugan pointed out that the level of housing starts activity in Canada remains high in historical terms. Between Canada’s largest cities — Toronto, Montreal and Vancouver — the latter was the only market to show growth in total SAAR starts during October thanks to a rebound in the multi-family segment in the previous month.

Vancouver reported a 50% increase in total month-to-month SAAR starts, rising from 14,195 to 21,227 units. Meanwhile, Toronto and Montreal reported monthly drops of 43% and 17% as SAAR starts fell to 31,591 and 28,180 units.

Within the single-family segment specifically, Montreal and Vancouver reported between a zero and 1% increase in SAAR housing starts from September to October, while starts in this category jumped 7% in Toronto.

For “All Others” housing types, Toronto and Montreal saw SAAR housing starts fall 49% and 19%, while they rose 63% in Vancouver.

CMHC defines a housing start as when construction begins on a building where a dwelling unit is located, typically when concrete has been poured for the footing around the structure, or the equivalent stage when a basement is not a part of the structure.

Canadian Housing Starts Slow Down in October by Michelle McNally | Livabl

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