New home construction starts saw a seasonal decline in December, but 2016 overall was a record year for housing starts, according to figures released by the Canada Mortgage and Housing Corporation (CMHC) January 10.
Housing starts in the Vancouver Census Metropolitan Area (CMA) were trending at 25,980 units in December compared with 27,455 units in November, said the CMHC. The trend is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.
“Total housing starts trended lower in December, but were in line with the monthly average for 2016,” said Robyn Adamache, CMHC’s principal market analyst for Vancouver. “Starts in 2016 set a new record for the region that was bolstered by strong rental construction in the cities of Vancouver, New Westminster and Surrey.”
Housing starts in the Abbotsford-Mission CMA in December were trending at 889 units, down from 970 units in November. The CMHC noted that this downward trend was spread evenly across all home types.
Nationwide, the housing starts trend measure across Canada was 198,053 units in December, slightly down from 200,105 units in November, reported the CMHC.
The housing agency noted that Canada still counted more home starts in 2016 than 2015, with increased demand for single-family homes more than offsetting a national decline in multi-unit construction – “a decline that’s in response to efforts to manage current inventories,” added the report.
CMHC uses six-month moving averages to account for considerable swings in monthly estimates and obtain a more complete picture of the state of the housing market. In some situations, said the CMHC, analyzing only the monthly seasonally adjusted data can be misleading in some markets, as they can be variable from one month to the next.
Metro Vancouver’s building permit values bucked the national trend by surging ahead in November, according to Statistics Canada data, also released January 10.
The Vancouver CMA issued $709 million worth of new home construction permits in November, said the federal statistics agency – a jump of nearly 40 per cent over an already-strong October, and more than 30 per cent higher than November 2015.
The month-over-month rise was led by another slew of permits issued for new condo-apartment buildings, for which there were more than $503 million of permits issued in November, a 71 per cent leap over October’s values and up 41 per cent compared with the same month the previous year.
The condo permit value was more than three times that of detached-house permits issued in November, which stood at $146 million. This was still a rise of nearly 12 per cent year over year and 20.3 per cent month over month.
However, Vancouver’s townhouse and row home permit values saw a weaker month after a strong showing in October, dropping nearly 39 per cent in November to $52.2 million. This was still a slight year-over-year rise of 1.1 per cent.
Values of new duplex construction permits, which are highly fluctuating as they are a much smaller segment of the market, increased again in November to $3.4 million, up 49.3 per cent year over year and 28.6 per cent since September.
The same trend was reflected across the province as a whole, with $962.7 million of home building permits issued in November. This is a rise of 34.2 per cent from the same month last year and 21.4 per cent compared with October.
Across the country, however, building permit values slid in November after a record-breaking October, with the $4.4 billion total value a drop of 23.1 per cent month over month. The gains seen in BC and Quebec were not enough to offset monthly declines in nine provinces and territories, including Ontario (-12.1 per cent) and Alberta (-74 per cent). Despite this, the national total for November was still a 33 per cent rise over the value of permits issued in November 2015, with only Alberta reporting a year-over-year decline.
View Statistics Canada’s interactive charts here.