Housing Starts

The national trend in housing starts continued to decline in August from the historical peak that was recorded in March 2018. This moderation brings total starts closer to historical averages, largely reflecting recent declines in the trend of multi-unit starts from historically elevated levels earlier in the year.

The trend in housing starts was 214,598 units in August 2018, compared to 219,656 units in July 2018. This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

Monthly Highlights

Vancouver

Housing starts in the Vancouver Census Metropolitan Area (CMA) trended higher in August 2018 as more multi-family projects got underway across the region. The cities of Vancouver and Burnaby led the way and accounted for over half of starts during the month due to a number of new condominium apartment projects. Demand for housing from residents remains strong and has resulted in the pace of new home construction so far in 2018 moving ahead of the level recorded during the first eight months of 2017.

Kelowna

Despite a very strong August for housing starts in the Kelowna CMA, the first 8 months of 2018 have seen a decrease of 29% in the single-detached segment and 28% in the multi-unit segment, relative to the record year of housing construction seen in 2017. Despite this decrease in construction activity, the pace of housing starts in 2018 remains well above the 10-year average.

Edmonton

The trend measure for housing activity in the Edmonton CMA moved upward significantly in August, driven by an increase in new construction of multi-unit dwellings. Despite the rebound in construction activity in August, housing starts in the first 8 months of the year remain approximately 7% below the pace of activity of the same period in 2017, as builders deal with elevated inventories of completed and unsold units.

Winnipeg

Total housing starts trended higher for the second consecutive month. Total housing starts increased by almost a third in August 2018 compared to a year earlier as condominium and rental apartment construction both increased. Declining inventories have supported new construction.

Toronto

Total housing starts trended lower mainly due to fewer condominium apartment and single-detached home starts. Rising prices and land constraints have pulled back sales of pre-construction single-detached units over the past several years resulting in fewer single-detached starts so far in 2018 when compared to the same period in 2017. However, strong pre-construction sales of condominium apartments over the past couple of years have led to a higher level of condominium starts on a year-to-date basis, despite the pull-back in August.

Oshawa

Total housing starts trended higher in the Oshawa CMA, due to higher trending multi-family dwelling starts, particularly row units. August recorded the most actual row unit starts for the month in almost three decades. While demographic and economic conditions remain favourable, higher house prices in Toronto and surrounding areas continue to increase the popularity of relatively more affordable higher density housing in Oshawa.

Windsor

Housing construction in Windsor continues to rebound from a slow first half in 2018. The trend in new housing construction grew for the third month in a row, with greater multi-unit construction driving the increase. Year-to-date housing starts were down by 27% compared to the same period last year, as the extraordinary levels of activity seen in 2017 eased and moved closer to levels consistent with economic fundamentals.

Kingston

The August trend in Kingston CMA total housing starts declined slightly for the first time in the past five months. Yet, it remained close to the high level seen during the last year. This strength comes off the heels of a strong year for housing starts in 2017 and thus far robust starts in 2018. Demand likely has been supported by the relative affordability of all dwelling types compared to other Ontario CMAs.

Saguenay

In August 2018, year-to-date housing starts in the Saguenay CMA were up over the same period last year. However, the trends differed depending on the intended markets. In fact, in the freehold (single- and semi-detached) home segment, an increase in starts was recorded, likely supported by renewed growth in full-time employment. Conventional rental housing construction was down, particularly because of a relatively high vacancy rate and a net migration deficit.

Halifax

While construction activity on the single-detached market remained stable year-over-year, multiples starts this month have more than doubled the levels recorded last August. Year-to-date, multiples construction has outpaced the same period in 2017 by 7%, with rental market demand continuing to be impacted by growth in international and interprovincial migration into the Halifax CMA.

New Brunswick

The trend in total housing starts in New Brunswick was up in August. Construction of multi-unit buildings has led the way so far in 2018 increasing by 13% year-to-date. Single housing starts were the highest for the month of August since 2015 and have increased 9% year-to-date.




Date Published: September 11, 2018