Hous­ing starts dip, CMHC says

B.C.’s new tax on for­eign­ers buy­ing homes in Van­cou­ver leads to slow­ing con­struc­tion

Toronto Star - - BUSINESS -

OTTAWA— Canada Mort­gage and Hous­ing Corp. says the pace of hous­ing starts slowed in most re­gions of the coun­try in Oc­to­ber, with an es­pe­cially big drop in Bri­tish Columbia.

The agency says the sea­son­ally ad­justed an­nual rate fell to 192,928 units in Oc­to­ber, down from 219,363 units in Septem­ber.

The drop came as the sea­son­ally ad­justed an­nual rate of ur­ban starts fell 12.1 per cent in Oc­to­ber to 176,131 units. Ru­ral starts were es­ti­mated at a sea­son­ally ad­justed an­nual rate of 16,797 units. Mul­ti­ple-unit ur­ban starts dropped15.3 per cent to115,402 units for the month, while sin­glede­tached ur­ban starts slipped 5.4 per cent to 60,729 units.

CMHC says the pace of ur­ban hous­ing starts picked up in On­tario last month, but there were de­clines in Que­bec, the Prairies, At­lantic Canada as well as Bri­tish Columbia.

The an­nual pace of ur­ban starts in B.C. fell to 25,517 in Oc­to­ber, com­pared with 46,294 in Septem­ber.

Bank of Montreal se­nior econ­o­mist Robert Kav­cic said Bri­tish Columbia was the big story. “We’ll see if this level of ac­tiv­ity, par­tic­u­larly in Van­cou­ver where starts fell to the low­est since 2011, holds in the months ahead in re­sponse to soft­en­ing de­mand con­di­tions,” Kav­cic wrote in a note to clients.

The drop in home starts in Van­cou­ver comes as real-es­tate sales in the re­gion have also fallen sharply.

In Au­gust, the B.C. govern­ment im­ple­mented a 15-per-cent tax on for­eign­ers buy­ing homes in Metro Van- cou­ver. The fed­eral govern­ment moved last month to tighten rules for mort­gage len­ders and for­eign buy­ers in an ef­fort to sta­bi­lize hot hous­ing mar­kets such as Toronto and Van­cou­ver.

The hous­ing-starts data came as Sta­tis­tics Canada re­ported mu­nic­i­pal­i­ties is­sued $6.9 bil­lion worth of build­ing per­mits in Septem­ber, down 7 per cent from Au­gust.

The de­crease was due in large part to a drop in plans for con­struc­tion for non-res­i­den­tial build­ings.

The value of non-res­i­den­tial build­ing per­mits fell 22.3 per cent to $2.2 bil­lion in Septem­ber as all three non-res­i­den­tial com­po­nents — com­mer­cial, in­sti­tu­tional and in­dus­trial — moved lower.

The value of per­mits in the res­i­den­tial sec­tor gained 2.6 per cent to to­tal $4.6 bil­lion in Septem­ber, boosted by multi-fam­ily dwellings.

Newspapers in English

Newspapers from Canada

© PressReader. All rights reserved.