The total number of housing starts in the country accelerated in April. They increased by more than 20% in comparison to March, and significantly more when compared to January and February. This increase was primarily fueled by an increase in construction of new multi-unit projects. This includes condos, apartments and townhouses, seen primarily in metropolitan areas across the country. Single starts in major urban areas also saw a small increase, but nowhere near the rates experienced by multi-unit projects.
CMHC reports strong growth in April
CMHC’s Canada’s April Housing Starts report shows that the seasonally adjusted annual rate (SAAR) of housing starts in April totalled 235,460 units. This represents a 22.6% increase from 191,981 in March of this year.
To further break down those stats, the SAAR rate of urban housing starts increased by 24.0% in April to 220,387 units. Multiple urban starts increased by 29.6% to a total of 175,732 units. And single-detached urban starts only increased by 6%, totaling 44,655 units. Finally, rural starts were estimated to have a SAAR of 15,073 units.
This growth in housing starts was led by a significant increase in multi-unit developments in Ontario, B.C and Alberta. Here they experienced an increase of 46%, 51% and 36% in April respectively when compared to March.
April’s increased numbers of housing starts stand in contrast with the string of declines seen at the end of 2018 and the first months of 2019. It seems like this increase in construction is not going to slow any time soon.
Economists optimistic after latest housing starts
“Although the Canadian housing market slowed at the start of the year, the latest data suggest the downward momentum has stabilized and could even be picking up again,” said Priscilla Thiagamoorthy, an economic analyst at BMO Capital Markets. “Underlying demand remains healthy amid solid demographic trends and a strong labour market.”
Josh Nye, is a senior economist at RBC Economics Research. He claims that the increase in housing starts is a sign that the housing market is heading towards. And he expects this recovery in the near future. “Signs of stabilization in at least some major resale markets and ongoing strength in homebuilding — particularly the multi-unit segment — suggest the housing sector is shifting to a more neutral force in Canada’s economy after acting as a sizable drag last year.”