MNI DATA ANALYSIS:Cdn Bldg Permits +2.6%,Hse Prices Flat Y/Y>

By Yali N'Diaye

     OTTAWA (MNI) - The value of building permits issued by Canadian 

municipalities rose 2.6% to C$8.3 billion in November, led by the 

non-residential sector, data from Statistics Canada showed Thursday. 

     Meanwhile, Canada's new housing prices were unchanged for the 

fourth consecutive month in November, leading to a flat 12-month rate as 

well, the agency also reported Thursday. Prices had been rising each 

month since January 2010 on a 12-month basis. They were down 0.9% in 

December 2009 year-over-year. 

     House and land prices were also flat on the month. 

     On a 12-month basis, house only prices contracted 0.3%, the largest 

decrease since December 2009. Land only prices rose 0.5%, following a 

0.4% gain in October. 

     The housing market has failed to stabilize as the Bank of Canada 

had hoped for following a weak start to 2018 marked by the introduction 

of tighter mortgage qualification rules combined with ongoing monetary 

policy tightening. 

     The BOC said in its policy announcement Wednesday that housing, 

along with oil prices and global trade developments, are high on its 

radar. 

     "Housing activity has recently been weaker than anticipated and is 

expected to remain soft" through 2020, it said in its Monetary Policy 

Report. 

     The central bank also keeps an eye on household spending and 

housing in oil-rich provinces. In Alberta, permits rose 10.4% in 

November, while new house prices were flat on the month and down 0.9% 

from November 2017. 

     - RESIDENTIAL WEAKNESS 

     The increase in construction intentions over the month overshadowed 

weakness in the residential sector, where permits fell 2.5%, led by 

single-family dwellings (-5.5%), notably in Ontario, where single-family 

permits reached their lowest level since January 2016. 

     On Wednesday, Canada Mortgage and Housing Corporation reported that 

the six-month trend in housing starts declined to a seasonally adjusted 

annual rate of 206,981 units in December from 212,338 in November. 

     For 2018, housing starts were down from the previous year, led by 

single-detached starts. 

     Permits for multiple-family dwellings edged down 0.1% in November. 

     - NON-RESIDENTIAL RISES 

     Non-residential building permits, on the other hand, rose 11.6% in 

November, led by the industrial (+21.9%) and the commercial (+16.8%) 

sectors. Institutional permits fell 7.2%. 

     Non-residential permits were up in five provinces, led by British 

Columbia. 

     - SOFT PRICES 

     On the price front, the most expensive areas, Toronto and 

Vancouver, showed a soft picture. 

     In Vancouver, prices fell 0.3% in November, the largest monthly 

decline in a year. On a 12-month basis, prices edged up 0.1%, the 

smallest gain since March 2015. 

     Toronto continued to see prices decline on a year-over-year basis, 

with a 1.3% drop.

     The more comprehensive Teranet-National Bank National Composite 

House Price Index fell 0.3% in November, with broad based declines. 

Teranet-National Bank pointed out a November decrease was unusual. 

--MNI Ottawa Bureau; email: yali.ndiaye@marketnews.com 

[TOPICS: M$C$$$,MACDS$]