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The number of new homes kicking off construction trended downward last month according to the latest insights released by the Canada Mortgage and Housing Corporation (CMHC). Meanwhile, a significant increase in total monthly starts was noted in Toronto.
In February, the trend in housing starts was 251,579 units, a slight drop from the 253,864 units recorded in January.
The trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts. This measure is used to complement the monthly SAAR of housing starts to account for swings in monthly estimates and to get an idea of upcoming new housing supply, according to CMHC. Analyzing just SAAR data alone can be misleading, the organization explains, as the multi-unit segment largely drives the market and can “vary significantly from one month to the next.”
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In February, the standalone monthly SAAR of total housing starts for all areas in Canada was 247,256 units. This marks an eight per cent increase from January’s 229,185 units.
“On a trend and monthly SAAR basis, the level of housing starts activity in Canada remains historically high; however, the six-month trend in housing starts declined slightly from January to February,” explained Bob Dugan, CMHC’s chief economist, in a press release.
Last month, the SAAR of total urban starts jumped 10 per cent to 222,563 units between January and February, while housing starts in rural areas were estimated at a seasonally adjusted annual rate of 24,693 units.
By housing type, the SAAR of multi-unit urban starts grew 13 per cent month-to-month from 143,150 units to 161,912 units in February. Meanwhile, single-detached urban starts nudged up two per cent to 60,651 units during the same period.
“For SAAR housing starts in Canada’s urban areas, both single-detached and multi-unit starts increased in February,” said Dugan. “Among Montréal, Toronto and Vancouver, Toronto was the only market to post growth in total SAAR starts in February, due to higher single-detached and multi-unit starts.”
In Canada’s three largest cities, housing starts in Toronto, Vancouver and Montréal reported the total SAAR for starts to be 65,763 units, 17,168 units and 16,142 units in February. Construction starts in the latter two cities fell 23 per cent and 40 per cent from January while Toronto posted a 195 per cent monthly gain in the SAAR of total housing starts, up from 22,268 units in January.
Toronto’s “all others,” category of housing starts, which excludes single-detached properties, increased 303 per cent between January and February as the SAAR of starts jumped from 13,980 units to 56,364 units.
A housing start takes place when construction begins on a building where a dwelling unit is located, as per CMHC. 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.