In a positive turn of events, the Canada Mortgage and Housing Corp. (CMHC) reports that the annual pace of housing starts experienced a notable 18% increase in December compared to the previous month. This surge was attributed to a significant uptick in multi-unit urban starts in key cities such as Vancouver and Montreal.
According to CMHC's latest data, the seasonally adjusted annual rate of housing starts for December reached an impressive 249,255 units, marking a substantial rise from November's figure of 210,918 units. The noteworthy surge was primarily driven by a 20% increase in the seasonally adjusted annual rate for urban housing starts, reaching 234,705 units.
Within the urban landscape, the momentum was particularly evident in multi-unit projects, where the annual rate of starts increased by a substantial 26%, totaling 191,463 units. Meanwhile, the pace of single-detached urban starts experienced a modest decline of 2%, settling at 43,242 units.
The annual pace of rural starts for December was estimated at 14,550 units, contributing to the overall positive trend in the housing market.
Further analysis of the data reveals that the six-month moving average of the monthly seasonally adjusted annual rates of housing starts in December was 249,898 units. Although this reflects a 2.1% decrease from November's figure of 255,198 units, the overall trend remains encouraging.
Zooming out to examine the entire year, CMHC reports that actual urban housing starts for 2023 totaled 223,513 units. This represents a 7% decline from the previous year's figure of 240,590 units. Notably, the decrease in urban starts for 2023 was predominantly driven by a significant 25% drop in single-detached home starts.
Despite the overall annual decline, the positive momentum observed in December indicates a potential shift in the market dynamics. The surge in multi-unit urban projects, particularly in Vancouver and Montreal, underscores the resilience of the Canadian housing market.
The housing sector's performance is closely monitored as it serves as a key indicator of economic health. The increased pace of housing starts suggests a potential boost to the construction industry, creating jobs and stimulating economic activity. Additionally, the variety in housing starts, including both multi-unit and single-detached projects, reflects a diverse and dynamic housing market.
In conclusion, the CMHC's report on the substantial increase in the annual pace of housing starts in December paints an optimistic picture for the Canadian housing market. The surge, fueled by urban multi-unit projects, signifies potential economic growth and stability in the construction sector, positioning the market for a promising start to the new year.
