June's housing starts in Canada decline, with major cities like Toronto and Vancouver seeing significant drops
In June, the total seasonally adjusted annual rate (SAAR) of housing starts in Canada dropped by 9 percent to 241,672 units from 264,929 units in May, according to the Canada Mortgage and Housing Corporation (CMHC).
The six-month trend in housing starts also declined by 0.4 percent, falling from 248,260 units in May to 247,205 units in June.
Urban centres with populations over 10,000 saw a 13 percent decrease in housing starts, totalling 20,509 units in June, compared to 23,518 units in June 2023. This decline was primarily driven by a 16 percent drop-in multi-unit starts, while single-detached starts remained stable.
Toronto and Vancouver experienced significant decreases in housing starts in June 2024 compared to June 2023, with Toronto down 60 percent and Vancouver down 55 percent due to reduced multi-unit construction.
Conversely, Montréal saw a 226 percent increase in starts, largely due to a surge in multi-unit activity.
During the first half of 2024, Canada’s six largest Census Metropolitan Areas (CMAs) recorded a 4 percent combined year-over-year increase in housing starts. Higher starts in Calgary, Edmonton, and Montréal offset declines in Vancouver, Toronto, and Ottawa.
Vancouver and Toronto faced slower apartment starts, impacted by high interest rates and weak condominium pre-construction sales, while Montréal experienced a 63 percent rise in apartment starts from an eight-year low in 2023.
Calgary and Edmonton saw increased construction across all dwelling types, with total starts up 38 percent and 67 percent, respectively.
Bob Dugan, CMHC’s chief economist, noted that the higher interest rate environment has caught up with some of Canada's major centres, particularly Vancouver and Toronto, where lower multi-unit starts drove down both the SAAR and trend in June.
While strong starts growth in Calgary, Edmonton, and Montréal in June and the first half of 2024 mitigated some decreases, downward pressure on starts is expected to continue throughout 2024.
The monthly SAAR of total urban housing starts for centres with populations over 10,000 decreased by 9 percent to 223,234 units. Multi-unit urban starts fell by 12 percent to 180,205 units, while single-detached urban starts increased by 2 percent to 43,029 units.
The rural starts monthly SAAR estimate stood at 18,438 units.
Montréal experienced a 23 percent increase in total SAAR housing starts, driven by a 26 percent rise in multi-unit starts. Vancouver saw a 13 percent decline due to decreased multi-unit starts, and Toronto recorded a 37 percent decrease, also primarily in multi-unit starts.
Housing starts data facilitates the analysis of monthly, quarterly, and year-over-year activity in the new home market, supporting various housing reports.
