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Canada Housing April 2021

Canada: Housing starts ease notably in April, but remain upbeat nonetheless

Housing starts fell to 268,631 units on a seasonally-adjusted annualized rate (SAAR) basis in April according to the Canada Mortgage and Housing Corporation (CMHC), down from March’s 334,759-unit reading. April’s fall was driven by a strong decrease in multi-detached starts, while single-unit urban starts were relatively flat.

That being said, the six-month average of housing starts in urban areas rose to 279,055 units in April from 272,163 units in March. Commenting on April’s print, Rishi sondhi, an economist at TD Economics, noted:

“Moving past the near-term, we anticipate some moderation in starts as demand comes off the boil and interest rates rise. Purpose-built rental construction has been an important driver of homebuilding. For example, they accounted for 1/3rd of starts in the first quarter – matching a multi-decade high. Looking forward, an anticipated pick up in population growth should support rental demand, although soft growth in rents and high vacancy rates in several key markets present challenges.”

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