Canada

Canadian New Home Starts Rise To Highest Level Since 2017, Pandemic Be Damned

Canadian real estate developers are scrambling to get shovels in the ground. Canadian Mortgage and Housing Corporation (CMHC) data shows new home starts jumped in July. The surprisingly fast bounce in starts means Canada is seeing the most starts since 2017 – despite the pandemic.

Canadian New Home Starts Reached The Highest Level Since 2017

Canadian housing starts ripped to the highest level in a few years, even with the pandemic underway. There were 245,604 starts seasonally adjusted at annual rates (SAAR) in July, up 15.8% compared to the month before. This represents an increase of 11.1% compared to the same month last year. The number of starts is the highest level of starts since November 2017. Breaking down the top three urban real estate markets, we can see the increase in activity is fairly broad.

Canadian New Home Starts

The number of new home starts across Canada, seasonally adjusted at annual rates.

Source: CMHC, Better Dwelling.

Toronto Sees Biggest July Since 2012 For New Home Starts

Toronto is seeing the most new home starts for the month in almost a decade. There were 48,466 starts SAAR in July, up 17.4% from the month before. This represents an increase of 47.8% compared to the same month last year. Last month was the most new home starts for the month of July since 2012.

Greater Toronto New Home Starts

The number of new home starts across Greater Toronto, seasonally adjusted at annual rates.

Source: CMHC, Better Dwelling.

Vancouver Housing Starts Fall Over 23% In July

Vancouver is one of the few major markets seeing less home starts than last year. There were 24,395 starts SAAR in July, up 3.6% from the month before. This represents a decline of 23.3% compared to the same month last year. Despite the slower activity, the number of starts remained the highest since December 2019. The region has seen slow pre-sale absorption over the past couple of years, which likely is going to slow multi-family development.

Greater Vancouver New Home Starts

The number of new home starts across Greater Vancouver, seasonally adjusted at annual rates.

Source: CMHC, Better Dwelling.

Montreal Reported The Most Housing Starts For July In 30 Years

Montreal slowed from the month before, but is a lot busier than it typically is this time of year. There were 35,748 starts SAAR in July, down 9.3% from the month before. The decline still worked out to a massive increase of 43.3% from last year. While it’s lower than the month before, last month was the most units started in any July, over the past 30 years.

Greater Montreal New Home Starts

The number of new home starts across Greater Montreal, seasonally adjusted at annual rates.

Source: CMHC, Better Dwelling.

The record number of starts is a surprise considering the economy only just reopened. Weak pre-sales in markets like Toronto and Vancouver over the past few years are expected to slow down the trend. It remains to be seen how the economic fallout during the pandemic impacts the trend long-term.

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6 Comments

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  • Marc 2 months ago

    Get the shovel in the ground ASAP, or they won’t be able to collect the full 20% and they’ll be bagholding.

  • Karen Wilson 2 months ago

    Why are new home sales so soft if there’s a huge amount of new products commencing building?

  • SH 2 months ago

    Good! Re-zone the cities and get building. The entitled Boomers will shriek but they aren’t in control anymore. I look forward to seeing lots of mid-rise and high-rise buildings casting long shadows over their McMansions.

    • Itchy Bear 2 months ago

      Yes, lucky us. We can really stick it to those baby boomers by living in our tiny little coffins in the sky.

  • alvi 2 months ago

    I dont understand the headline and comments, I thought housing starts reflect sales from previous 18-24 months,bound to slow down ?

  • CDR 2 months ago

    Housing starts are for contracts that were signed months to years ago.

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