Canada: Housing starts recover in June; multi-unit urban starts hit all-time high
Housing starts on a seasonally-adjusted annualized (SAAR) basis skyrocketed to 248,100 units in June, according to the Canada Mortgage and Housing Corporation (CMHC). June’s reading suggests May’s dismal figure of 193,900 units was a one-off, landing above the symbolic 200,000-unit threshold for the twelfth time in 13 months and well above analysts’ expectations of a moderate increase to 210,000 units.
Groundbreaking on multi-unit urban starts hit an all-time high in June, shrugging off this year’s new mortgage-lending rules that had, up to now, cooled the once-hot housing market. A breakdown by city showed that Toronto experienced an eyewatering rise in multi-unit groundbreaking, while Montreal posted more moderate gains. On the other hand, multi-unit starts in Vancouver declined in the month. Unsurprisingly, a breakdown by province showed a substantial increase in multi-unit urban starts in Ontario—hinting that last year’s market-cooling provincial legislation had largely run its course.
Meanwhile, the six-month moving average of housing starts (SAAR) jumped in June, rising from 216,700 units in May to 222,000 units and closing in on the near-decade records set earlier this year.
A separate report, released by Statistics Canada, also showed that the value of Canadian building permits increased considerably in May—the most recent month for which data is available. Building permits rose 4.7% from April as intentions strengthened in the residential sector, particularly in Ontario.