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Housing starts trended downward in March

Housing-starts-march
April 19, 2022

Photo: Ernest / Adobe Stock

Michelle McNally - livabl.com

Last month, the number of housing units kicking off construction trended lower across the country.

According to the latest data from the Canada Mortgage and Housing Corporation (CMHC), the trend in housing starts was 252,497 units in March, 799 units less than the 253,296 unit starts recorded in February.

CMHC defines a housing start when construction begins on a building where a dwelling unit is located. This usually occurs when concrete has been poured for the footing around the structure, or the equivalent stage when a basement is not a part of the structure.

The standalone monthly seasonally adjusted annual rates (SAAR) of total housing starts for all areas in Canada was 246,243 units in March. This marks a two per cent drop from February. Last month, the SAAR of total urban starts also fell by two per cent to 220,708 units, down from 224,738 starts.

“On a trend and monthly SAAR basis, the level of housing starts activity in Canada remains historically high, hovering above 200,000 units since June 2020; however, the trend in housing starts posted a small decline from February to March,” said Bob Dugan, CMHC’s chief economist, in March’s housing starts report.

“The decline in the monthly SAAR housing starts in Canada’s urban areas was driven by lower multi-unit starts, which were partially offset by higher single-detached starts in March. Among Montreal, Toronto and Vancouver, Montreal was the only market to post growth in total SAAR starts, which was driven by higher multi-unit starts,” he added.

The trend measure is a six-month moving average of the SAAR of housing starts. CMHC explained that the trend measure is a complement to the monthly SAAR of housing starts to account for “considerable swings,” in monthly estimates. It also helps to determine a more accurate estimate of upcoming new housing supply. Using SAAR data alone can be misleading since the multi-unit segment largely drives the market and can change from one month to the other, CMHC stated in its report.

By housing type, multi-unit urban starts dropped five per cent from 163,807 units to 154,876 units between February and March, while urban starts for single-detached homes increased eight per cent from 60,931 units to 65,832 units during the same time period. Rural starts were estimated at a seasonally adjusted annual rate of 25,535 units.

In Canada’s three largest cities — Toronto, Vancouver and Montréal — the monthly SAAR of total housing starts equaled 39,741 units, 14,218 units and 23,479 units in March.  Toronto and Vancouver recorded a monthly drop in total housing starts, down 40 per cent and 17 per cent month-to-month, while construction starts increased between February and March in Montréal by 46 per cent. Moncton, Barrie and Kelowna recorded some of the highest changes in total SAAR housing starts last month, where monthly starts increased 451 per cent, 342 per cent and 162 per cent, respectively.

 

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