Canada’s Trend In September Housing Starts Sees Little Change Says CMHC

Chart: CJMC/Twitter

Ottawa: The trend in housing starts was 214,647 units in September 2020, up from 212,609 units in August 2020, according to Canada Mortgage and Housing Corporation (CMHC).

This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

“The national trend in housing starts was largely unchanged in September,” said Bob Dugan, CMHC’s chief economist. “Multi-family starts have been very volatile in recent months, partly reflecting the impact of COVID-19.

“High levels of multi-family starts in July and August were largely offset by lower levels in September, leaving the trend largely unchanged. This pattern was particularly evident in Ontario, including Toronto. We expect national starts to trend lower by the end of 2020 as a result of the negative impact of COVID-19 on economic and housing indicators.”

CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and 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 208,980 units in September, a decrease of 20.1% from 261,547 units in August. The SAAR of urban starts decreased by 21.1% in September to 195,909 units.

Multiple urban starts decreased by 27% to 146,005 units in September while single-detached urban starts increased by 3.4% to 49,904 units.

Rural starts were estimated at a seasonally adjusted annual rate of 13,071 units. Like much other government organizations, businesses and individuals, CMHC is closely following developments around COVID-19.

The monthly release of the Preliminary Housing Starts data will continue as planned. CMHC will report any impact on its ability to collect housing data.

“We are always looking to improve our products and the way we share key housing market data and analysis. As such, starting in November 2020, we will be moving our monthly housing starts data and news release from the 6th to 11th business day. This allows us to deliver a complete package of data all at once, rather than releasing preliminary data at an earlier date. October housing starts will be released at 8:15 ET on Tuesday, November 17, 2020,” CMHC said.

As Canada’s authority on housing, CMHC contributes to the stability of the housing market and financial system, provides support for Canadians in housing need, and offers objective housing research and information to Canadian governments, consumers, and the housing industry.