Some impressive numbers were released on Tuesday indicating that September was a good month for homebuilders in the Calgary and Edmonton regions.
According to statistics from Canada Mortgage and Housing Corp., the Edmonton census metropolitan area saw single-detached housing starts of 403 for the month, up nine per cent year over year. The ‘all other’ category experienced a hike of 128 per cent to 517 units.
In the Calgary census metropolitan area, single-detached starts rose by 37 per cent from a year ago to 383 while the ‘all other’ sector increased by 113 per cent to 1,182.
“Housing starts in Edmonton trended upwards for the fourth consecutive month in September. The year-over-year increase in total housing starts was largely driven by the multi-family market segment as levels more than doubled due to a rise in both rental and condominium starts. Despite elevated inventories, new housing construction has picked up, leading to an increase in year-to-date housing starts,” said the CMHC in a news release.
Across Canada, the trend in housing starts was 223,507 units in September, compared to 218,782 units in August, said the CMHC. The trend is a measure of the six-month moving average of the monthly seasonally-adjusted annual rates (SAAR) of housing starts.
“The national trend in housing starts increased in September,” said Bob Dugan, CMHC’s chief economist. “Higher trending single-detached starts in urban centres since July, following several months of declines combined with higher-trending multi-family units in September to push the total starts trend to its highest level since April 2018.”
The CMHC said it uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of Canada’s housing market.
CMHC said the standalone monthly SAAR of housing starts for all areas in Canada was 221,202 units in September, down 2.5 per cent from 226,871 units in August. The SAAR of urban starts decreased by 2.4 per cent in September to 208,503 units. Multiple urban starts decreased slightly by 0.2 per cent to 159,742 units in September while single-detached urban starts decreased by 9.2 per cent to 48,761 units. Rural starts were estimated at a seasonally adjusted annual rate of 12,699 units.
“After a winter lull, Canadian housing starts climbed back into the top half of the range they’ve tracked since 2017, but now look to be flattening out again,” said CIBC economist Avery Shenfeld in a commentary note.
“The 221,000 September pace was down only marginally from the prior month and also nearly right on consensus, so there’s not much of a story for markets to chew on here, although the larger drop in singles starts is a negative detail in terms of the GDP contribution ahead. Overall, while we could get some growth from real estate agents fees and renovations, the pop in GDP growth we got from housing in quarter two is likely to be less vigorous in the next couple of quarters.”
Mario Toneguzzi is a Troy Media business reporter based in Calgary.