Home construction still ahead of last year’s pace

For the seventh consecutive month, more than 150 foundations were poured for new single-family homes in one month, according to Canada Mortgage and Housing Corporation.

The 166 starts in October brings the year-to-date total of single-detached new homes to 1,591, which was seven per cent ahead of 2006 at 1,481 starts.

Overall, foundations were poured for  366 housing units — single-family and multiple-family — in October, a 35 per cent drop over October last year which at 564 units was the highest monthly total since July 1989.

“While the 200 starts in October represent the third time in 2007 that multiple-family activity has reached the 

200-unit level, October 2006 construction totalled an impressive 416 units,” said Jeff Powell, CMHC’s senior market analyst. However, multiple-family starts in the Capital Region (Winnipeg and surrounding municipalities) continued to surpass the strong 2006 performance, posting a 38 per cent gain during the first 10 months of this year, he added.

The 1,432 units started thus far in 2007 are already more than the 1,040 starts in all of 2006.

Powell said 165 of the multiple-

family units were for rent, bringing to 792 the number of rental starts in the city this year.

“Once completed, this rental construction will help reverse a 15-year slide in rental apartments in Winnipeg, thereby providing additional supply to a rental market characterized by low 

vacancies,” added Powell.

Areas outside the city also continued to show strength in new home construction, according to CMHC. 

In the RM of Springfield, 14 single-family starts were recorded in October, bringing the total for the first 10 months of  the year to 100. 

In the RM of St. Clements, there were seven starts in October, bringing its year-to-date total to 91 starts.

Throughout Winnipeg and the surrounding municipalities there were 3,023 starts of all housing types in the first 10 months, which is 20 per cent ahead of last year’s pace.

 Across Canada, the seasonally-

adjusted annual rate of housing starts was 219,500 units in October, down 22  per cent from 281,300 units in September, according to CMHC.

“The decline in housing starts in 

October reflects the exceptional strength in new construction in September rather than weakness in October,” said Bob Dugan, chief economist at CMHC’s Market Analysis Centre. 

“Much of the decline in October can be attributed to the fall in multiple starts. We continue to expect that residential construction activity will remain strong throughout next year, with the trend 

decreasing gradually between now and the end of 2008.” 

The seasonally-adjusted annual rate of urban starts decreased 24.9 per cent to 183,600 in October, compared to September. 

Urban singles were down six per cent to 84,900 units in October, while multiple starts decreased 36 per cent to 98,700 units.

In October, urban starts registered a decrease of 14.7 per cent in the Atlantic region, 36.0 per cent in Quebec, 30.6 per cent in Ontario, 20 per cent in the Prairies, and 5.6 per cent in British Columbia. 

Actual starts, in rural and urban areas combined, were up an estimated 1.5 per cent in the first 10 months of 2007 compared to the same period in 2006. In urban areas, actual total starts grew by an estimated 0.1 per cent year-to-date. Actual urban single starts from January to October 2007 were down 5.3 per cent compared to the same period in 2006, while multiple starts grew by approximately 5.4 per cent over the same period.

The rate of growth in new housing prices decelerated for the 10th consecutive month in September, in line with a trend seen across most of the country, 

according to Statistics Canada.

Contractors' selling prices increased 6.2 per cent between September 2006 and September 2007, a slowdown from the 6.5 per cent gain observed in August.

Saskatoon again had the highest year-over-year increase of all census metropolitan areas. Selling prices there increased 47 per cent from September 2006, but this was still slower than the record-high 53.6 per cent gain in August.

Only two Western metropolitan areas showed growth in year-over-year new home price increases. Prices rose 29.6 per cent in Regina in September, compared with 29.2 per cent in August. In Winnipeg, selling prices rose 16.2 per cent, compared with 16 per cent in August. In both centres, higher costs for carpenters and electricians drove the increase, according to Statistics Canada.