How Did the Canadian Housing Market Do in March?
With the second quarter of the year now in full swing, some current indicators can help show the direction the Canadian housing market is going as of March 2019.
Housing starts in March came in at 202,279 units according to Canada Mortgage and Housing Corporation (CMHC). This is a steady pace compared to the 202,039 units in February. This trend is measured by a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.
“The trend has been very stable since the final quarter of 2018, following a period of steady declines from the historically elevated levels registered in recent years," said Bob Dugan, CMHC’s chief economist. "Higher mortgage rates combined with still-favourable, but less stimulative economic conditions have contributed to moderation in demand for new homes in urban centres.”
Looking at cities across the country, Vancouver trended higher in March, with roughly half of the projects during the month being multi-family housing. The housing starts for the first quarter this year were recorded 16% lower than the same quarter in 2018.
The Toronto Census Metropolitan Area (CMA) reports trends rose in March with a higher trend in condominium apartment starts offsets a declining low-rise start trending. Due to the rising homeownership costs, pre-construction sales of low-rise homes are down compared to condominium starts, which are much more affordable.
In other cities Montreal had a 10 year high with a little over 5000 starts while Saskatoon experienced 25% fewer housing starts in the first quarter compared to last year. In Calgary, builder have been slowing production down, due to less demand and inventory concerns. The exception is row starts, which have increased yearly by 48% in the first quarter.
The monthly SAAR of housing starts for all areas in Canada was 192,527 units in March. This is up 15.8% from 166,290 units in February. The SAAR of urban starts went up by 17.0% to 178,033 units. Multiple urban starts increased by 18.6% to 135,894 units, while single-detached urban starts increased by 12.1% to 42,139 units.
Do you think the housing market will stay with the current trends or change drastically 2019?