Ottawa and Gatineau area housing starts up in May
June 25, 2019
Ottawa and the Gatineau region bucked the national housing starts trend in May, increasing from the month before. Nationally, the trend in housing starts decreased – 201,983 units in May, compared to 205,717 units the month before. This trend, according to Canada Mortgage and Housing Corporation (CMHC), measures a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.
“The national trend in housing starts decreased in May as a result of continuing decline in the trend for single starts as well as a decline in the trend of multi-unit starts that follows gains in this segment in recent months, in urban areas,” says Bob Dugan, CMHC’s chief economist.
“The decrease in the trend of multi-unit starts reflects a decline in the SAAR level of multi-unit activity in May from the unusually elevated level registered in April, which leaves multi-unit SAAR starts closer to its 10-year average.”
In Ottawa
Housing starts trended slightly higher in May because of higher row starts. Year-to-date actual starts are up 14 per cent relative to the same period last year due mainly to a rise in condominium apartment starts while single-detached homes declined. Rising ownership costs are shifting demand toward relatively more affordable dwellings, and tight resale market conditions are encouraging builders to increase supply of condominium apartment units.
Gatineau
From January to May, residential construction in the Gatineau area reached a five-decade record high.
This strong increase was attributable mainly to the rise in rental housing starts in the Plateau neighbourhood. The aging of the population and the low vacancy rate have continued to stimulate starts of this type in the Gatineau area.
CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and to obtain a more complete picture of Canada’s housing market.
In some situations, analyzing only SAAR data can be misleading, as they are largely driven by the multi-unit segment of the market, which can vary significantly from one month to the next.
The standalone monthly SAAR of housing starts for all areas in Canada was 202,337 units in May, down 13.3 per cent from 233,410 units in April. The SAAR of urban starts decreased by 14.4 per cent in May to 186,946 units. Multiple urban starts decreased by 18.5 per cent to 141,851 units in May while single-detached urban starts increased by 1.8 per cent to 45,095 units.