A new home is under construction in North Vancouver, B.C., Tuesday, June 12, 2018. Canada Mortgage and Housing Corp. says the annual pace of housing starts picked up in June. THE CANADIAN PRESS Jonathan Hayward

CMHC reports pace of housing starts in Canada jumped higher in June

The housing report came a day ahead of the Bank of Canada’s next interest rate decision

The annual pace of housing starts picked up in June, the latest piece of economic data to paint a picture of a stronger second quarter.

Canada Mortgage and Housing Corp. said Tuesday the pace of housing starts rose to a seasonally adjusted annual rate of 245,657 units compared with 196,809 units in May.

The result topped the 210,000 units that economists had expected, according to Thomson Reuters Eikon.

Robert Kavcic, senior economist at BMO Capital Markets, said the result was yet another factor helping to drive a strong rebound in second quarter growth.

“Residential construction activity remains rock solid, as still-strong demographic flows are supporting unit demand,” Kavcic wrote in a note.

The housing report came a day ahead of the Bank of Canada’s next interest rate decision. The central bank is widely expected to keep its key interest rate target on hold on Wednesday when it also releases its latest monetary policy report.

READ MORE: CMHC reports pace of Canadian housing starts slowed in May, below estimate

The Canadian economy hit a weak spot at the end of 2018 that extended through the start of this year, however strength has been building in recent months as the Bank of Canada expected.

The increase in the pace of home starts came as the rate of urban starts increased by 26 per cent in June to 234,238 units.

The annualized pace of multiple-unit projects such as condominiums, apartments and townhouses increased by 31 per cent to 185,804 units last month, while the pace of single-detached urban starts rose eight per cent to 48,434 units.

Rural starts were estimated at a seasonally adjusted annual rate of 11,419 units.

TD Bank economist Rishi Sondhi said new home construction in Canada has continued to hold up well, in contrast to the home resale market.

“That said, starts are moving gradually lower on a trend basis, with the six-month average well off its near-term peak observed in late 2017,” Sondhi wrote.

“We anticipate some further moderation, as starts move closer to a more fundamentally supported level of around 200,000.”

The six-month moving average of the monthly seasonally adjusted annual rates was 205,838 units in June compared with 200,530 in May.

In a separate report, Statistics Canada said Tuesday the value of building permits issued in May fell to $8.2 billion compared with a record $9.5 billion in April.

The drop came as the value of permits for multi-family dwellings in British Columbia fell following a significant rise in April in response to impending increases in development costs.

The value of residential permits fell 17.2 per cent to $5.0 billion in May, following a 26.6 per cent increase in April.

The value of non-residential permits dropped 5.7 per cent to $3.3 billion in May.

ALSO READ: Victoria-area ‘inflatable home’ the first in Canada

The Canadian Press


Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

‘Inclusive, affordable’ South Surrey project aims to meet ‘desperate’ housing need

Public consultation on 91-unit ‘Harmony’ to launch online next month

‘Not a joke’: Promoter wants to rocket-launch man the length of White Rock pier

Brooke Colby says he’s building an eight-foot rocket in his backyard

Missing North Delta senior found deceased

88-year-old Jarnial Sanghera had been missing since the morning of Friday, May 15

Dry-grad cancelled, Elgin Park students make donation to food bank

Students donate $1,800 to food bank after being forced to cancel graduation event

South Surrey girl asks friends to help make birthday rock – literally

Charley Pauliuk marked her 11th year with a display of cheer

VIDEO: Procession to honour Snowbirds Capt. Jennifer Casey comes to Halifax

Snowbirds service member died in a crash in Kamloops one week ago

Bike shops busier than ever, but owners worry about stock supply issues

Uptick in cyclists brings new challenges for shops

RCMP facing ‘systemic sustainability challenges’ due to provincial policing role

Provinces, territories and municipalities pay anywhere from 70 to 90 per cent of the cost of the RCMP’s services

One man dead after standoff with Chilliwack RCMP

The Independent Investigations Office of B.C. is investigating the RCMP’s role in the death

B.C. employers worry about safety, cash flow, second wave in COVID-19 restart

A survey found 75 per cent of businesses worry about attracting customers

Ex-BC Greens leader Andrew Weaver says province came close to early election

Disagreement centred on the LNG Canada project in northern B.C.

Canada’s NHL teams offer options to season-ticket holders

Canadian teams are offering refunds, but also are pushing a number of incentives to let them keep the money

Boy, 2, left with ‘soft tissue injuries’ after being hit by car in Squamish intersection

Boy was release from hospital, police continue to investigate

B.C. premier says lessons to learn from past racism during response to pandemic

B.C. formally apologized in the legislature chamber in 2008 for its role in the Komagata Maru tragedy

Most Read

l -->