June’s Canadian housing starts were off the charts, so what happened this October? Could it be the change in weather? While multiunit developers are key to solving Canadian cities’ affordability crisis, a decrease in multi-unit home starts this October had the overall housing starts data trending lower for the month.
Big picture that might look like the market is slowing down – though that’s only half the story. This month the Canadian Mortgage and Housing Corp (CMHC), explained that the seasonally adjusted annual rate of housing starts last month slowed to 201,973 units in October compared with 221,135 in September – despite the fact that several multi-unit developments are set to launch.
The decline came as the pace of urban starts fell 9.0 per cent, while just the multi-unit housing sectors fell by 12.5 per cent to 139,518 units. On the bright side, single-detached homes rose by 2.4 per cent to 49,786 units. After nearly a year of declines, single-detached starts have been on the increase, especially in Canadian cities. This bounce-back has come with a slight increase in average price per detached home as well, with more than 50 per cent of neighbourhoods in the GTA reporting a rise in detached housing values, according to RE/MAX.
The housing start downward trend came as a bit of a shock, since economists from Refinity Capital had previously predicted a higher number of 221,200 starts for last month.
Think of it as a mild fluctuation in a greater scheme of growth. Thanks to low interest rates, which should continue till the end of the fiscal year, CMHC also reported that the national outlook for the housing market looks bright well into 2020.