The first six months of 2017 is setting a healthy pace for housing construction throughout most of Canada.
In June, Canada recorded 215,458 housing starts, compared to 214,570 units in May 2017, according to Canada Mortgage and Housing Corporation (CMHC).
“The trend in housing starts for Canada reached its highest level in almost five years,” said Bob Dugan, CMHC’s chief economist. “So far this year, all regions are on pace to surpass construction levels from 2016. Except for British Columbia, where starts have declined year-to-date after reaching near-record levels last summer.”
In Vancouver, the number of new builds dropped. In the first six months of 2017, there were 880 ownership apartment starts in Vancouver, compared with 3,290 in the first half of 2016. The CMHC notes the decline is not surprising due to the record number of housing starts in the past year.
In Victoria, housing starts trended higher in June as new rental projects broke ground in Langford. Although new starts have increased, Victoria isn’t maintaining pace with a record-setting 2016, as multi-unit builds are sluggish. However, multi-unit construction remains elevated at 30 per cent above the five-year average.
The total housing starts trend in the Toronto Census Metropolitan Area (CMA) remained virtually unchanged in June. The pace of new home construction is stable across all housing forms. A minor decline in the single-detached starts trend is offset by gains in the multi-family sector. Looking further back, construction of ground-oriented homes, which includes single-detached, semis and townhouses, gained momentum throughout the year, as housing starts reach a five-year high. Limited resale supply in combination with strong home buying demand in Toronto is leading buyers to purchase pre-construction units.
Room to grow in Innisfil
In Barrie, single-detached and row starts push Barrie’s total housing starts up for the second month in June. Demand for new homes continued to fuel home starts in Innisfil instead of the land-scarce Barrie. The town of Innisfil is now the prime location for the construction of low and medium-density homes in the Barrie CMA.
Fort McMurray is experiencing strong rebuilding activity after the wildfires last year. Since January, 785 housing starts have been recorded, twice as many as in the last two years combined. The majority of these new starts have been replacement single detached homes.
In June, housing starts trended higher in Québec as a result of a large condominium project. However, in conventional rental housing, year-to-date results show a 22 per cent decrease in housing starts compared to the same period in 2016. This decrease is partially explained by the period of strong activity observed in this segment in 2015 and 2016 and the rise in the vacancy rate.