Canadian housing starts increased in 2016
By Lucas on Jan 10, 2017
The Canada Mortgage and Housing Corporation (CMHC) released its housing starts data for December 2016, announcing that national starts declined, mostly due to the slowing down of multi-unit construction. The trend measure was 198,053 units, compared to 200,105 in November 2016. The trend is a six month moving average of seasonally adjusted annual rates (SAAR).
“December saw multi-unit construction slow for the third consecutive month in Canada, leading housing starts to trend down,” says Bob Dugan, CMHC Chief Economist. “However, 2016 still counted more home starts than 2015. Increased demand for single-detached homes more than offset the decline we’re seeing in multi-unit construction – a decline that’s in response to efforts to manage current inventories.”
The standalone monthly SAAR for December was 207,041 units, a significant increase compared to November’s 187,273. The SAAR of urban starts went up 11.8% to 187,621 units, with multiple urban starts rising 13.9% to 120,750 and urban single detached starts going up 8.1% to 66,871.
Housing starts went up in Ontario, Quebec and the Prairies, and declined in British Columbia and Atlantic Canada. Rural starts are estimated to be around 19,420 units.
Housing starts in Toronto CMA
Overall, Toronto Census Metropolitan Area (CMA) had a healthy year of housing starts. Construction slowed down in December, but that’s to be expected. Last month, the trend measure was 37,269 units, down from November’s 39,230. The standalone SAAR was 34,396 units, up from 30,560 the previous month.
“Compared to earlier in the year, new home construction slowed down in Toronto during the final month of 2016,” says Andrew Scott, CMHC Senior Market Analyst for the GTA. “While fewer apartment starts have led to an overall annual decline when compared to 2015, single-detached home starts were up by 16%, hitting their highest level in nearly a decade. This demand for new homes is supported by improved economic conditions and migration.”
The City of Toronto saw the most starts thanks to many new apartments. Brampton followed closely in second with mostly single and row starts. Mississauga came in third with many apartment starts.
East Gwillimbury, New Tecumseth, and Brampton led the year with the most single-detached starts, while new apartment starts slowed down in Vaughan and Mississauga.
With supply of single detached homes failing to meet demand, it will be interesting to see how housing starts are affected this year.
