Hafez Realty News

Canadian Housing Starts Trend Increases in June

The trend in housing starts was 222,041 units in June 2018, compared to 216,701 units in May 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.


"The national trend in housing starts increased in June, reflecting a jump in the SAAR of multi-unit dwellings in urban centres in June to a historical high," said Bob Dugan, CMHC's chief economist. "Notably, the national inventory of newly completed and unabsorbed multi-unit dwellings has remained below its 10-year historical average so far in 2018, indicating that demand for this type of unit has absorbed increased supply."

Monthly highlights

Vancouver

Housing starts trended lower in June 2018 as fewer multi-family projects got underway during the month. For the first half of 2018, total housing starts matched the level of activity in the same period in 2017. Particularly high home prices and strong demand from a growing population so far in 2018 have incentivized some new supply, maintaining an elevated pace of new home construction in the Vancouver Census Metropolitan Area (CMA).

Victoria

Metro Victoria housing starts reached mid-year 45% ahead of 2017 levels, driven by substantially higher multi starts. Rental starts were double the rate seen in the first half of 2017 in response to low vacancy rates. Elsewhere, relatively more affordable housing types dominated construction. Condo construction was nearly 60% higher due to the relative affordability of condos over single detached units, which were down 15%. The generally lower average prices in Langford coincided with 44% of all construction in the metro area. Ground-oriented, freehold multi-unit construction was also up 41%, pointing to densification.

Calgary

June housing starts were down in Calgary year-over-year, but year-to-date (YTD) there has been 8% growth over 2017. Single-detached units were on par with the previous year, while there were roughly half as many rental units initiated. The growth in total housing starts has been driven by the condo market. Condo starts grew 36% YTD over 2017.

Winnipeg

The trend measure of housing starts declined further in June after the pace of both single-detached and multi-family starts slowed from the previous month. Following a strong performance in 2017, total housing starts in the Winnipeg CMA continued to moderate during the first half of 2018, down 32% from a year earlier. The decline was most pronounced in the multiples sector where production through June 2018 declined by 38% from the same period of 2017.

Province of Québec

For the first six months of the year, the relatively strong rate of residential construction in Quebec is attributable to the apartment market segment, including rental and condominium. Favourable economic conditions, decreasing supply in the resale market and population aging have all contributed to increased housing starts.

Kingston

Housing starts in Kingston trended higher in June as more multi-unit housing starts, including starts of rental apartments, got underway. Builders have started rental projects in four out of the last six months reflecting a very low vacancy rate, which stood at 0.7% in fall 2017, the lowest among 16 Ontario CMAs.

Toronto

Primarily led by apartment starts, the total number of housing starts in the Toronto CMA trended up to reach a near two year high in June. Driven by condominium apartment starts which recorded a 30 year high for the month. The majority of these apartment starts were spread evenly across the City of Toronto, Mississauga, and Vaughan, highlighting the broad spread of high rise construction in the Toronto CMA.

Hamilton

Apartment starts increased in June, causing overall housing starts to trend up. Apartment starts have reached a very high level in Hamilton due to strong demand from first-time buyers, downsizers, and rental property investors. Faced with fewer options in the resale market at their price point, more first-time buyers and downsizers have purchased new condominium apartments. Rental property investors are looking to take advantage of the extremely low vacancy rates in the region.

St. Catharines

Total housing starts in the St. Catharines CMA trended slightly lower in June. Nevertheless, they were nearly 50% above the ten year average. The mild slowdown was generated by the single-detached sector, while all multi-family housing types saw increases this month. Stronger migration flows from other parts of Ontario continue to fuel demand for new homes in the area.

Kitchener-Cambridge-Waterloo

Total housing starts trended upwards in the Kitchener-Cambridge-Waterloo CMA for the first time in the past five months. While row starts continued trending downwards, marginal increase in single-detached starts was able to pull total starts higher. The slight pickup in full-time employment and tightening resale market conditions during late 2017 supported spillover demand for single-detached units from the resale market to the new construction market.

Halifax

After a slow start to 2018, multiples construction in Halifax picked up pace in June, the strongest month so far this year. While levels of construction remain strong on the Halifax Peninsula, the majority of new apartments starts this year have been located in the suburban market. Construction on the single-detached market remains elevated, recording a year-to-date growth of 10% compared to the same period last 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 248,138 units in June, up from 193,902 units in May. The SAAR of urban starts increased by 29.9% in June to 228,844 units. Multiple urban starts increased by 46.4% to 172,845 units in June while single-detached urban starts decreased by 3.5% to 55,999 units.

Rural starts were estimated at a seasonally adjusted annual rate of 19,294 units.



Preliminary Housing Start Data in Centres 10,000 Population and Over
  Single-DetachedAll OthersTotal
June 2017 June 2018 % June 2017 June 2018 % June 2017 June 2018 %
Provinces (10,000+)  
N.-L. 71 82 15 43 10 -77 114 92 -19
P.E.I. 29 31 7 77 42 -45 106 73 -31
N.S. 147 184 25 53 324 ## 200 508 154
N.B. 106 121 14 63 170 170 169 291 72
Atlantic 353 418 18 236 546 131 589 964 64
Qc 740 804 9 2,708 4,061 50 3,448 4,865 41
Ont. 3,115 2,355 -24 4,173 6,871 65 7,288 9,226 27
Man. 259 209 -19 271 282 4 530 491 -7
Sask. 204 134 -34 210 102 -51 414 236 -43
Alta. 1,277 1,032 -19 1,336 1,176 -12 2,613 2,208 -15
Prairies 1,740 1,375 -21 1,817 1,560 -14 3,557 2,935 -17
B.C. 1,004 908 -10 2,274 2,055 -10 3,278 2,963 -10
Canada (10,000+) 6,952 5,860 -16 11,208 15,093 35 18,160 20,953 15
Metropolitan Areas                  
Abbotsford-Mission 34 31 -9 233 16 -93 267 47 -82
Barrie 125 40 -68 86 254 195 211 294 39
Belleville 48 51 6 2 6 200 50 57 14
Brantford 4 58 ## 45 4 -91 49 62 27
Calgary 445 360 -19 945 707 -25 1,390 1,067 -23
Edmonton 570 475 -17 261 387 48 831 862 4
Greater Sudbury 17 26 53 14 11 -21 31 37 19
Guelph 31 29 -6 29 78 169 60 107 78
Halifax 98 110 12 12 281 ## 110 391 255
Hamilton 101 48 -52 105 498 374 206 546 165
Kelowna 77 91 18 134 210 57 211 301 43
Kingston 39 47 21 201 180 -10 240 227 -5
Kitchener-Cambridge-Waterloo 93 94 1 134 203 51 227 297 31
Lethbridge 41 33 -20 17 13 -24 58 46 -21
London 229 130 -43 336 480 43 565 610 8
Moncton 42 37 -12 30 58 93 72 95 32
Montréal 314 328 4 1,121 2,484 122 1,435 2,812 96
Oshawa 160 214 34 438 129 -71 598 343 -43
Ottawa-Gatineau 319 367 15 400 812 103 719 1,179 64
Gatineau 8 25 213 73 204 179 81 229 183
Ottawa 311 342 10 327 608 86 638 950 49
Peterborough 43 54 26 11 5 -55 54 59 9
Québec 107 95 -11 1,118 812 -27 1,225 907 -26
Regina 68 37 -46 117 41 -65 185 78 -58
Saguenay 18 37 106 8 22 175 26 59 127
St. Catharines-Niagara 124 60 -52 84 87 4 208 147 -29
Saint John 20 33 65 0 0 - 20 33 65
St. John's 51 66 29 39 7 -82 90 73 -19
Saskatoon 119 88 -26 79 43 -46 198 131 -34
Sherbrooke 59 51 -14 46 114 148 105 165 57
Thunder Bay 21 22 5 24 8 -67 45 30 -33
Toronto 1,059 600 -43 2,108 4,116 95 3,167 4,716 49
Trois-Rivières 31 25 -19 31 42 35 62 67 8
Vancouver 457 422 -8 1,585 1,045 -34 2,042 1,467 -28
Victoria 85 94 11 194 418 115 279 512 84
Windsor 108 73 -32 50 23 -54 158 96 -39
Winnipeg 231 167 -28 265 239 -10 496 406 -18
Total 5,388 4,493 -17 10,302 13,833 34 15,690 18,326 17

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-DetachedAll OthersTotal
May 2018 June 2018 % May 2018 June 2018 % May 2018 June 2018 %
Provinces (10,000+)  
N.L. 374 659 76 138 120 -13 512 779 52
P.E.I. 277 274 -1 216 504 133 493 778 58
N.S. 1,302 1,534 18 2,032 3,917 93 3,334 5,451 63
N.B. 729 802 10 879 1,879 114 1,608 2,681 67
Qc 6,448 6,672 3 27,338 44,299 62 33,786 50,971 51
Ont. 23,145 21,455 -7 29,201 79,361 172 52,346 100,816 93
Man. 2,627 2,318 -12 2,580 3,384 31 5,207 5,702 10
Sask. 1,204 1,252 4 2,676 1,224 -54 3,880 2,476 -36
Alta. 12,627 11,313 -10 21,765 13,594 -38 34,392 24,907 -28
B.C. 9,314 9,720 4 31,270 24,563 -21 40,584 34,283 -16
Canada (10,000+) 58,047 55,999 -4 118,095 172,845 46 176,142 228,844 30
Canada (All Areas) 70,389 69,082 -2 123,514 179,057 45 193,902 248,138 28
Metropolitan Areas                  
Abbotsford-Mission 253 323 28 288 192 -33 541 515 -5
Barrie 458 249 -46 1,692 3,048 80 2,150 3,297 53
Belleville 310 452 46 636 72 -89 946 524 -45
Brantford 442 757 71 720 48 -93 1,162 805 -31
Calgary 4,790 4,079 -15 15,180 8,484 -44 19,970 12,563 -37
Edmonton 5,739 5,093 -11 5,424 4,644 -14 11,163 9,737 -13
Greater Sudbury 41 177 332 96 132 38 137 309 126
Guelph 155 188 21 96 936 ## 251 1,124 348
Halifax 487 897 84 1,644 3,372 105 2,131 4,269 100
Hamilton 478 444 -7 4,284 5,976 39 4,762 6,420 35
Kelowna 844 1,074 27 2,964 2,520 -15 3,808 3,594 -6
Kingston 313 351 12 240 2,160 ## 553 2,511 354
Kitchener-Cambridge-Waterloo 1,021 871 -15 1,044 2,436 133 2,065 3,307 60
Lethbridge 450 389 -14 288 156 -46 738 545 -26
London 1,526 1,033 -32 516 5,760 ## 2,042 6,793 233
Moncton 160 232 45 324 696 115 484 928 92
Montréal 2,815 2,832 1 17,583 29,594 68 20,398 32,426 59
Oshawa 1,583 1,513 -4 696 1,548 122 2,279 3,061 34
Ottawa-Gatineau 2,986 2,913 -2 5,832 9,744 67 8,818 12,657 44
Gatineau 460 275 -40 2,148 2,448 14 2,608 2,723 4
Ottawa 2,526 2,638 4 3,684 7,296 98 6,210 9,934 60
Peterborough 379 362 -4 288 60 -79 667 422 -37
Québec 691 791 14 5,364 9,744 82 6,055 10,535 74
Regina 421 321 -24 828 492 -41 1,249 813 -35
Saguenay 176 247 40 240 264 10 416 511 23
St. Catharines-Niagara 655 631 -4 720 1,044 45 1,375 1,675 22
Saint John 168 206 23 0 0 - 168 206 23
St. John's 249 538 116 108 84 -22 357 622 74
Saskatoon 643 785 22 1,728 516 -70 2,371 1,301 -45
Sherbrooke 256 266 4 1,512 1,368 -10 1,768 1,634 -8
Thunder Bay 59 114 93 0 96 ## 59 210 256
Toronto 8,507 6,274 -26 14,904 49,392 231 23,411 55,666 138
Trois-Rivières 304 165 -46 360 504 40 664 669 1
Vancouver 4,288 4,450 4 22,272 12,540 -44 26,560 16,990 -36
Victoria 1,097 956 -13 2,124 5,016 136 3,221 5,972 85
Windsor 586 531 -9 432 276 -36 1,018 807 -21
Winnipeg 1,994 1,773 -11 2,484 2,868 15 4,478 4,641 4


Provided by: CMHC

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