Canadian housing starts trend higher in September

Wednesday, October 12, 2016

In September, the trend measure of housing starts in Canada was 199,503 units, compared to 196,465 in August, according to Canada Mortgage and Housing Corporation (CMHC). The trend is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

“Housing starts were on an upward trend in September, as residential construction increased across the country with the exception of Ontario, where the multiples segment softened to levels that are more consistent with household formation,” said Bob Dugan, CMHC chief economist, in a press release. “Quebec saw the largest gain in housing starts due to the development of new rental apartments intended for seniors. That said, Quebec’s growing apartment stock emphasizes the importance of inventory management.”

CMHC uses the trend measure to complement the monthly SAAR of housing starts to account for significant swings in monthly estimates and to obtain a better picture of the state of Canada’s housing market. Sometimes, analyzing only SAAR data can be misleading, as this data is largely driven by the multi-unit segment of the market, which varies significantly from month to month.

The standalone monthly SAAR for all regions in Canada was 220,617 units in September, an increase compared to August’s 184,201 units. The SAAR of urban starts increased by 19.7 per cent in September to 201,848 units. Multiple urban starts increased by 22.3 per cent to 137,803 units in September, while single-detached urban starts increased by 14.5 per cent to 64,045 units.

Although September saw the seasonally adjusted annual rate of urban starts increasing in British Columbia, Quebec, the prairies and Atlantic Canada, it decreased in Ontario.

Rural starts were estimated at a seasonally adjusted annual rate of 18,769 units.

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