Canadian housing construction output falls
Housebuilding slowed slightly in Canada in September and is expected to continue to fall
Figures from the Canada Mortgage and Housing Corporation showed a seasonally adjusted annual rate of 220,215 homes in September.
This was down 2 per cent from the previous month, as some normality returned to the sector.
Housing starts had soared 8 per cent from July to August, driven by condominium projects.
The Royal Institution of Chartered Surveyors said it expected housing starts to continue to fall into next year.
Economist Himanshu Wani said: ‘There are two main reasons we believe the current rate of housebuilding will slow going into 2013.
‘First, the government has tightened mortgage lending regulations four times since the great recession, and this is feeding through into sales activity.
‘Second, the Bank of Canada in its last few monetary policy statements has been signalling that the current highly stimulative monetary stance will eventually have to be normalised, suggesting the first interest rate hikes will begin in early 2013.’
The seasonally adjusted annual rate of urban starts increased by 18 per cent in the Prairies and by 20 per cent in Atlantic Canada in September.
Urban starts were up 1 per cent in Quebec but were down 4 per cent in British Columbia and 18 per cent in Ontario.
Mathieu Laberge, deputy chief economist at CMHC, said: ‘Following a period of elevated housing starts activity due to strong volumes of multi-family unit pre-sales in 2010 and 2011, the pace of housing starts is expected to moderate.’
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