June data hint worst may be over for market

New-home construction rose for a second straight month in June in what analysts say is another sign that the worst may be over for the Canadian housing market. Canada Mortgage and Housing Corp. said yesterday there were 140,700 homes built in June on a seasonally adjusted annualized basis. Construction was up almost 8% from the 130,300 units in May.

“There are some pretty good signs that we are starting to see in the housing market,” said Bob Dugan, CMHC’s chief economist. “We’ve seen it for quite a few months on the existing-homes side.” Existing-home sales rose 42% from January to May across the country and early indications are that June was the strongest month this year. Sales in Vancouver were up 76% last month from June a year ago and Calgary and Toronto both posted 27% increases during the same period.

Existing-home inventories have begun to shrink across the country, convincing builders to ramp up construction. CMHC said urban single-family homes — considered the best barometer of the new-home market — climbed 7.3% in May from a month earlier.

Read the full article by Garry Marr, “HOUSING CLAWS BACK” in the National Post / Financial Post (July 10, 2009).

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