Canada might have technically slipped into a recession earlier this year, but housing starts remain strong, according to the latest report from the Canada Mortgage and Housing Corporation.
The seasonally adjusted annual rate (SAAR) for Canadian housing starts in August was 216,924, a jump up from July’s SAAR of 193,253. BMO noted in analysis published today that housing starts haven’t measured this high since September 2012.
This number is also above the range that CMHC forecasted in February for 2015. Back then, it predicted starts to range between 154,000 and 201,000 this year.
Meanwhile, the trend measure of housing starts was 196,565, up from 185,642 in July. This measure is a six-month moving trend of the SAAR of housing starts.
The crown corporation said Toronto’s condo market is at the root of the increase in starts.
“Housing starts have been trending up, supported by strong condominium activity in Toronto,” said Bob Dugan, CMHC’s chief economist, in the release.
“This is in line with CMHC’s most recent forecasts that would see demand shift from new higher-priced single-detached homes towards lower-priced alternatives.”
The Toronto region’s SAAR for housing starts soared to 65,097 units in August, a far cry from the 23,716 units in July, a development that was mostly a byproduct of apartment starts (which include condominiums) that month.
“Significant increases in apartment starts lifted the trend number to its highest level since early 2013,” said Dana Senagama, a CMHC GTA market analyst, in the release.
Nationwide, the SAAR of multi-unit urban starts was up 19.5 per cent over July to 142,927, far ahead of single-detached urban starts which increased 1.4 per cent to 58.385 units.
“High sales of pre-construction condominium apartment units throughout 2014 continue to convert to starts this year,” added Senagama in the report.