CMHC: Canada November Home Starts 215.9k, Top Expectations

By Courtney Tower

     OTTAWA (MNI) - Canadian home building starts rose to a seasonally adjusted

at an annual rate of 215,941 units in November, well above analyst expectations

of 198,000 units, Canada Mortgage and Housing Corporation announced Monday.

     Starts were mixed for the two hottest housing markets that especially

concern the Bank of Canada, with the starts for the Vancouver Census

Metropolitan Area (CMA) continuing to trend lower over six months and to stand

at a decline of 9% year-to-date from the same period in 2017.

     For the Toronto CMA on the other hand, the trend rose to its highest level

so far in 2018, on a surge in condominium apartment starts. A downward trend in

detached housing starts continued in November because of fewer new home sales

over the year. Such sales are down, in single detached homes, because of "fewer

site openings and high prices ... in recent years," CMHC said.

     On the month, housing starts were up in urban centers by 2.2% to 202,054

units, due to a 3.9% increase in multiple urban starts (to 151,596 units) while

the higher-priced single detached urban starts fell by 2.3% to 50,458 units.

     The national six-month trend, which the CMHC prefers as a guide to home

starts, rose following four consecutive months of declines, said Bob Dugan, CMHC

chief economist. "While single-detached starts continued to trend lower, this

was more than offset by a gain of multi-unit starts following several months of

weakness."

     The housing starts report surprised analysts but should will please the

Bank of Canada. The latter said in its December policy statement that it

"continues to monitor the impact on both builders and buyers of tighter mortgage

rules, regional housing policy changes, and higher interest rates."

     Regionally, the picture was mixed in November. For the four Atlantic

provinces, starts in centers over 10,000 population rose in November to 757 from

674 in November a year ago. For Quebec the starts were flat (4,090 versus

4,064). For the three Prairie Provinces they were down 18% with decreases of 53%

for Saskatchewan and 26% for Alberta, the two main oil-producing provinces, but

a 40% gain for Manitoba. British Columbia overall showed starts down 15%.

--MNI Ottawa Bureau; +1 613 869-0916; email: yali.ndiaye@marketnews.com

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