Canada: Trend in housing starts drops in September following three months of gains
October 10, 2017
Seasonally-adjusted annualized housing starts registered 217,100 units in September, according to the Canada Mortgage and Housing Corporation (CMHC). September’s figure marked a 3.9% fall in housing starts from August’s 225,900 units but once again came in above most of last year’s prints. Despite the slowdown from August, September’s reading capped an otherwise strong Q3 in terms of groundbreaking. Moreover, market analysts had expected a sharper decline—to 210,000 units—from August’s reading.
September’s six-month moving average of housing starts retreated 2.6% from August’s nearly five-year high of 220,600 units and came in at 214,800 units started. Driving the lower reading in September was a double-digit drop in multiple starts, which are typically condominiums in the major cities, that more than offset a healthy increase in single starts. Moreover, housing starts in Toronto and Vancouver trended lower in the month as a result of fewer apartment starts and fewer multi-family starts, respectively.
Robert Kavcic, Senior Economist at BMO Capital Markets, commented that:
"Canadian homebuilding activity remains robust, with the best population growth in 25 years proving fundamental support. And, after declining modestly in the second quarter, residential investment looks to have added to growth again in the third quarter."
Author: Christopher Thomas, Economist