The trend in housing starts was 208,131 units in January 2019, compared to 207,171 units in December 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.

"After recent declines, the national trend in housing starts held steady in January and remained above historical average," said Bob Dugan, CMHC's chief economist. "While single-detached starts continued to trend lower in January, this was offset by an uptick in the trend for multi-unit dwellings in urban centres.

Monthly Highlights

Vancouver

The trend measure for housing starts in the Vancouver Census Metropolitan Area (CMA) held steady in January 2019 after trending lower in the second half of 2018. The majority of January’s starts were concentrated in the apartment condominium segment in the cities of Vancouver and Burnaby, which together accounted for over half of new construction activity for the month.

Kelowna

Total housing starts trended sharply upward in Kelowna for January. Condominium units in the city of Kelowna were the largest share of the uptick with larger projects breaking ground in the first month of 2019. This continued a trend of elevated multi-family construction in the region. However, single detached units also increased slightly.

Lethbridge

Total starts in Lethbridge trended higher in January 2019 compared to the previous month mainly due to the increase in single-detached starts. Multi-family starts declined marginally as the decrease in both row and apartment starts was partially offset by the increase in semi-detached starts.

Saskatoon

The trend measure of total housing starts edged higher in the first month of 2019. Nonetheless, actual total housing starts in January were down 15%, compared to January 2018. The reduction in building activity was entirely due to a sharp decline in multi-family construction while single-detached starts began the year on stronger footing.

Toronto

Toronto CMA total housing starts trend was unchanged from the previous month. Single and semi-detached homes along with condominium apartment starts trended lower. Row starts, conversely, trended significantly higher as strong pre-construction sales towards the latter part of 2018 converted into housing starts. Rising borrowing costs kept pre-construction sales of new homes low, particularly low-rise throughout 2018.  As a result, expect to see even fewer units breaking ground during 2019.

London

Total housing starts in London CMA trended higher due to increased apartment construction while single detached and rows homes starts continuing their downward trend. An increasing number of completed but unsold new single-detached homes resulted in fewer single-detached starts; as builders were able to satisfy demand from existing inventories.

Ottawa

Ottawa housing starts trended lower for all dwelling types in the first month of 2019. Starts this January marked the lowest for the month in over two decades. The number of units under construction in January was historically high, leaving homebuilders with fewer resources to commit to new construction.

Gatineau

In January 2019, housing starts trended lower for the second month in a row for the Gatineau area. However, the number of new rental housing units remains at a high level, as the aging of the population and the low vacancy rate continue to stimulate starts for this type.

Québec CMA

Housing starts activity started off slowly in the Québec CMA, as a result of a decrease in multi-unit segment. Despite this slowdown in January, multi-unit—especially rental—housing construction should stay relatively strong this year. Activity in this market segment is being stimulated in particular by migration and the aging of the population.

New Brunswick

In January 2019, New Brunswick’s total housing starts were 33% higher compared to a year ago. The increase was due to multiple-unit starts, which were more than double the number observed in January 2018. On the other hand, construction of single-detached housing has been on a downward trend and the number of starts in January was the lowest for the month in 20 years.

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 207,968 units in January, down from 213,630 units in December. The SAAR of urban starts decreased by 2.1% in January to 190,912 units. Multiple urban starts increased by 0.7% to 146,353 units in January while single-detached urban starts decreased by 10.4% to 44,559 units.

Rural starts were estimated at a seasonally adjusted annual rate of 17,056 units.

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Provided by: CMHC

Onni seeks to build 49, 45 and 25 storey buildings at Glen Drive and Pinetree Way

Another three towers could be added to the Coquitlam City Centre skyline.

Monday, council sent to public hearing a proposal by the Onni Group to build the highrises on the southeast corner of Pinetree Way and Glen Drive

Onni is proposing towers of 49, 45 and 25 storeys, comprising 891 units, including 186 rental units in the smallest tower. Ninety-five of the 705 market condos will be three-bedroom units while 31 of the 186 rental units will have three bedrooms.

(The report recommended requiring the rental tower be occupied prior to the market condominium towers.)

The developer also proposes 72,000 sq. ft. of commercial space on a six-storey podium on Glen Drive, with eight retail units, four floors of offices and a daycare space accommodating 80 to 100 children. It would be next door to a 40-storey tower being built by Polygon at Glen and Westwood Street that was approved last year. Council gave the go-ahead to that project despite several speakers at a public hearing complaining the area would become “a concrete jungle.”

Coun. Bonita Zarrillo was the only councillor to oppose Onni’s application going to a public hearing, expressing concern about the many buildings and lack of access to family housing.

“This is far too quick of a change,” said Zarrillo. “I don’t think this is the time to do this type of zoning given the lack of family and entry-level housing.”

The proposal calls for a $250,000 public art feature, two car-share vehicles, bike repair rooms, parking for 1,329 vehicles and 1,166 bicycles. A staff report said more design considerations have to be developed with Onni including a more distinct look to the podium.

Onni plans to install a micro district energy system fuelled by natural gas to provide heating, cooling and hot water. A city report estimated the system would reduce gas and electrical usage by five to 20% and greenhouse gases by 10 to 25%.

Mayor Richard Stewart said he wonders if the system would become more common with development proposals but city manager Pete Steblin said they work best when one owner owns it long-term, which Onni proposes to do, with regulation by the BC Utilities Commission. Steblin said not many developers are interested in the systems and many have objected to municipalities making them mandatory.

“We have wanted to encourage it but we didn’t want to get in the space of running it,” said Steblin, who added it’s not often a developer proposes to install the system.

The report said the development will generate an estimated $12 million in development cost charges and $31 million in density bonus funds, of which $2 million will go in the affordable housing reserve fund.

Provided by: Grant Granger for the Tri-City News

Photograph By CITY OF COQUITLAM 

Home listings continue to increase across all housing categories in the Metro Vancouver* housing market while home buyer activity remains below historical averages.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,103 in January 2019, a 39.3 per cent decrease from the 1,818 sales recorded in January 2018, and a 2.9 per cent increase from the 1,072 homes sold in December 2018.

Last month’s sales were 36.3 per cent below the 10-year January sales average and were the lowest January-sales total since 2009.

“REALTORS® are seeing more traffic at open houses compared to recent months, however, buyers are choosing to remain in a holding pattern for the time being,” Phil Moore, REBGV president said.

There were 4,848 detached, attached and apartment homes newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in January 2019. This represents a 27.7 per cent increase compared to the 3,796 homes listed in January 2018 and a 244.6 per cent increase compared to the 1,407 homes listed in December 2018.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 10,808, a 55.6 per cent increase compared to January 2018 (6,947) and a 5.2 per cent increase compared to December 2018 (10,275).

For all property types, the sales-to-active listings ratio for January 2019 is 10.2 per cent. By property type, the ratio is 6.8 per cent for detached homes, 11.9 per cent for townhomes, and 13.6 per cent for condominiums.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

“Home prices have edged down across all home types in the region over the last seven months,” Moore said.

The MLS® Home Price Index composite benchmark price for all residential homes in Metro Vancouver is currently $1,019,600. This represents a 4.5 per cent decrease over January 2018, and a 7.2 per cent decrease over the past six months.

“Economic fundamentals underpinning our market for home buyers and sellers remain strong. Today’s market conditions are largely the result of the mortgage stress test that the federal government imposed at the beginning of last year,” Moore said. “This measure, coupled with an increase in mortgage rates, took away as much as 25 per cent of purchasing power from many home buyers trying to enter the market.”

Sales of detached homes in January 2019 reached 339, a 30.4 per cent decrease from the 487 detached sales recorded in January 2018. The benchmark price for detached homes is $1,453,400. This represents a 9.1 per cent decrease from January 2018, and an 8.3 per cent decrease over the past six months.

Sales of apartment homes reached 559 in January 2019, a 44.8 per cent decrease compared to the 1,012 sales in January 2018. The benchmark price of an apartment property is $658,600. This represents a 1.7 per cent decrease from January 2018, and a 6.6 per cent decrease over the past six months.

Attached home sales in January 2019 totalled 205, a 35.7 per cent decrease compared to the 319 sales in January 2018. The benchmark price of an attached unit is $800,600. This represents a 0.5 per cent decrease from January 2018, and a 6.2 per cent decrease over the past six months.

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Provided by: REBGV

Under the EHT's current form, nearly 5,400 of the more than 7,900 homes deemed "vacant" were able to make use of exemptions to the tax.

Vancouver Mayor Kennedy Stewart is taking what could be the first steps toward his campaign promise of tripling the city's Empty Homes Tax (EHT).

In September, Stewart unveiled the promise to hike the tax rate to three per cent as one of the key planks in his housing platform.

Vancouver's EHT currently applies a one per cent tax on the assessed value of homes deemed to be vacant for more than six months per year, barring specific exceptions.

Stewart is now bringing a motion to council asking city staff to dig into the practicalities and possible repercussions of increasing the tax.

The motion calls on staff to develop a plan by March that would "review and improve the fairness and effectiveness of the Empty Homes Tax in achieving the objective of returning empty and underutilized properties to the market."

In doing so, it asks staff to "review the fairness and effectiveness of exemptions and definitions, considering as well the Provincial Speculation Tax definitions."

Under the EHT's current form, nearly 5,400 of the more than 7,900 homes deemed "vacant" were able to make use of exemptions to the tax.

Stewart's motion also asks staff to develop a proposed timeline for information on the impact of increasing the tax rate, along with possible program benefits and drawbacks.

Finally, it calls for recommendations on how to consult the public and conduct further internal analysis.

In November, the City of Vancouver said that in its first year, the EHT was expected to bring in about $38 million, $8 million above its initial estimate.

The tax is meant to encourage homeowners to rent out vacant properties, thus increasing the stock of available rental.

Last fall, the Canada Mortgage and Housing Corporation's (CMHC) 2018 rental market report for the city found the city's vacancy rate had declined from 0.9 per cent to 0.8 per cent year-over-year.

That same report found the average rent for a two-bedroom apartment had climbed in one year from $1,860 to $1,964.

Stewart's motion goes to council on Tuesday.

Provided by: Simon Little for MSN Money

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The British Columbia Real Estate Association (BCREA) reports that a total of 78,345 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in 2018, a decline of 24.5 per cent from the 103,758 units sold in 2017. The annual average MLS® residential price in BC was $712,508, an increase of 0.4 per cent from $709,601 recorded the previous year. Total sales dollar volume was $55.8 billion, a 24.2 per cent decline from 2017.

“BC home sales fell below the 10-year average of 84,800 units in 2018,” said Cameron Muir, BCREA Chief Economist. “The sharp decline in affordability caused by the B20 mortgage stress test is largely to blame for decline in consumer demand last year.”

A total of 3,497 MLS® residential unit sales were recorded across the province in December, down 39.1 per cent from December 2017. The average MLS® residential price in BC was $695,647, a decline of 5.2 per cent from December 2017. Total sales dollar volume was $2.4 billion, a 42.3 per cent decline during the same period. 

Total active residential listings were up 33.3 per cent to 27,615 units in December, the highest December inventory since 2014 when 33,995 active residential listings were recorded.

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Provided by: BCREA

The slowdown in Canada's housing market will get worse before it gets any better, a new analysis predicts, because the country is about to be flooded with a "huge amount" of new homes.

"Canada has been undergoing a construction boom," Capital Economics senior economist Stephen Brown wrote in the report issued last week. "As has been typical of historic real estate cycles around the world, new supply will reach the market just as demand is falling."

Indeed, home sales in Toronto in 2018 were 15 per cent below their historical norm in 2018, while in Vancouver they ran 40 per cent below the long-run average.

If the percentage of unsold new homes in Vancouver remains what it is, the number of unsold houses on the market will double in the metro area over the next two years as 40,000 new homes come on the market, Brown predicted.

© Provided by Oath Inc. Unsold units in Vancouver will pile up over the next two years, even if developers cut new construction to zero. 

The situation isn't quite so dire in Toronto — yet. Just one per cent of new homes in the area sits unsold, compared to 7 per cent in Vancouver. But Brown expects Toronto to follow in Vancouver's footsteps this year.

Developers will react by cutting back on new housing starts. But the lag between start and completion means the problem will happen regardless of what developers do now, Brown suggested. Even if Vancouver stopped building new homes entirely, the oversupply in the next two years would be nearly as large as if construction continued.

All of which could have a negative effect on the economy, starting with falling house prices.

"That, in turn, is likely to feed through to weaker consumer spending. Even more significantly, an end of the construction boom will weigh heavily on investment," Brown wrote.

But not everyone is convinced that the elevated levels of home construction mean there is an oversupply.

In a report last year, Bank of Montreal noted that Canada's population growth has accelerated in the past few years, thanks to higher immigration levels, and is now growing at the fastest pace in decades. That means we may be underestimating just what the "right" amount of new housing in Canada is, the bank's economists suggested.

"As has been typical of historic real estate cycles around the world, new supply will reach the market just as demand is falling."Stephen Brown, Capital Economics

That's also the view of many in the industry, who see a higher chance of housing shortages than oversupply in the coming years.

"With an increasing number of gainfully employed people looking to put a roof over their heads, and the scarce availability of rental accommodation, policy makers in our major markets will once again be struggling with housing shortages," said Phil Soper, president of realtor Royal LePage, in a market forecast in December.

"More than an affordable housing problem, we will once again be facing an overall housing supply crisis," Soper said.

"The future for Canadian housing remains bright, perhaps too bright."

Provided by:  HuffPost Canada on MSN Money

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.

"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.

 Provided by: CMHC