The Canada Mortgage and Housing Corporation (CMHC) reports housing starts in June have increased in the Barrie area (especially Innisfil) and in Oshawa, with overall starts this year throughout the province surpassing construction levels from 2016.
The total housing starts trend in the Toronto Census Metropolitan Area (CMA) remained virtually unchanged in June compared to the previous month. The pace of new home construction has been stable across all housing forms. A minor decline in the single-detached starts trend was offset by gains in the multi-family sector. Glancing further back, construction of ground-oriented homes, which includes single-detached, semis and town homes, have gained momentum throughout 2017, as housing starts so far this year have reached a five-year high. Limited resale supply in combination with strong home buying demand in Toronto have led more buyers to purchase pre-construction units.
Higher trending single-detached and row starts have pushed Barrie’s total housing starts up for the second month in June. Demand for new homes continued to fuel home starts in the town of Innisfil instead of the land-scarce city of Barrie. The town of Innisfil has become the prime location for the construction of low and medium-density homes in the Barrie CMA.
Oshawa had a record level of seasonally adjusted starts in June 2017, the pace of construction being nearly three times higher than the average seen over the past three years. While all housing types saw increases in June, the row and apartment segments were the clear leaders. Price weary buyers from the Toronto CMA continue to fuel demand for new homes in Oshawa.
Nationally, CMHC has reported that the trend in Canadian housing starts reached the highest level in five years in June.
The trend in housing starts was 215,459 units in June 2017, compared to 214,570 units in May 2017, according to CMHC data.This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.
“The trend in housing starts for Canada reached its highest level in almost five years,” CMHC chief economist Bob Dugan said in a statement. “So far this year, all regions are on pace to surpass construction levels from 2016 except for British Columbia, where starts have declined year-to-date after reaching near-record levels last summer.”
CMHC 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. In some situations analyzing only SAAR data can be misleading, as they are largely driven by the multi-unit segment of the market which can vary significantly from one month to the next.
The standalone monthly SAAR of housing starts for all areas in Canada was 212,695 units in June, up from 194,955 units in May. The SAAR of urban starts increased by 9.6 per cent in June to 194,773 units. Multiple urban starts increased by 9.4 per cent to 127,944 units in June and single-detached urban starts increased by 10.1 per cent, to 66,829 units.
Rural starts were estimated at a seasonally adjusted annual rate of 17,922 units.