Housing Starts Remain High in June Despite Decrease

The seasonally adjusted annual rate1 of housing starts was 217,800 units in June, down from 227,700 units in May, according to Canada Mortgage and Housing Corporation (CMHC).

“Despite the decrease in June, total housing starts remain at high levels.” said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “This is mostly due to the multiple segment which has been continuously above the 100,000 unit threshold since the beginning of the year.”

The seasonally adjusted annual rate of urban starts moved down by 5.0 per cent in June compared to May. Both urban multiples and singles decreased, with a decline of 3.0 per cent for multiples to 114,700 units, and a 7.8 per cent drop for singles to 74,600 units.

The seasonally adjusted annual rate of urban starts went down in all regions of Canada, except Ontario, where housing starts increased by 10.8 per cent to 77,900 in June. Urban starts declined to 8,500 units in Atlantic Canada, 40,300 units in Quebec, 31,200 units in the Prairies, and 31,400 units in British Columbia. Both single and multiple urban starts decreased in all regions in June, with the exception of multiple starts in Ontario which increased by 30 per cent.

Rural starts were estimated at a seasonally adjusted annual rate of 28,500 units in June2.

For the first half of 2008, actual starts in rural and urban areas combined were up an estimated 1.5 per cent compared to the same period last year. Year-to-date actual starts in urban areas have increased by an estimated 6.1 per cent over the same period in 2007. Actual urban single starts for the first six months of this year were 13.1 per cent lower than they were a year earlier, while multiple starts were up by 23.1 per cent over the same period.

1. All starts figures in this release, other than actual starts, are seasonally adjusted annual rates (SAAR) — that is, monthly figures adjusted to remove normal seasonal variation and multiplied by 12 to reflect annual levels.

2. CMHC estimates the level of rural starts for each of the three months of the quarter, at the beginning of each quarter. During the last month of the quarter, CMHC conducts the survey in rural areas and revises the estimate.

CMHC Ottawa July 9, 2008