The pace of housing starts in the Edmonton region outpaced the national market in March, according to Canada Mortgage and Housing Corp.
Photograph by: File photo , edmontonjournal.com
EDMONTON - The pace of housing starts in the Edmonton region outpaced the national market in March, according to Canada Mortgage and Housing Corp.
The national agency reported Tuesday that 1,176 homes were started in the month, up 14 per cent from March 2012.
“The trend in total housing starts moved up in March as a result of strong construction in both the single-detached and multi-family markets,” said David Lan, CMHC senior market analyst for Edmonton.
“Housing starts continue to be supported by employment growth, net migration and low mortgage rates.”
If the March pace was sustained over the year and after seasonal adjustments, CMHC said there were 14,863 starts in the Edmonton region, compared to February’s annualized figure of 13,624
Builders started 426 single-detached units in March, up nine per cent from a year earlier, CMHC said.
The multi-family sector grew by more than 17 per cent going to 750 starts in March from 639 in March 2012.
In Calgary, there were 890 total housing starts in March, down 16.7 per cent from 1,069 in March 2012.
Todd Hirsch, senior economist with ATB Financial, said housing starts dipped in Alberta last month to a seasonally adjusted, annualized rate of 34,900, down from February’s 35,300 — how many homes that would be built in a year if those months’ paces were maintained.
But Hirsch said there was little reason for concern.
“It’s still well above the five-year average of 27,580 annual starts and the figure has been quite stable over the past year,” he said.
And while today’s CMHC housing starts figures provide a good snapshot of current and past activity, Statistics Canada also released its building permits report — an excellent leading indicator of activity expected in the coming months.
Alberta’s residential building permits increased in February by 0.4 per cent over January; from 12 months ago, it has risen by 9.8 per cent.
Nationally, there are fresh signs of cooling in the Canadian housing market, but analysts say fears of a major crash have yet to materialize.
Canada Mortgage and Housing Corp. reported Tuesday that the pace of housing starts crept up slightly last month from February, despite a drop in the number of single dwellings begun in some urban markets.
Starts in March totalled 12,273 or 184,028 annualized, just slightly higher than in February but down 13.6 per cent from a year ago.
Simultaneously, Statistics Canada released a report on building permits that showed future building intentions for residential construction fell 7.2 per cent in February to $3.6 billion.
Both numbers were bad news for the Canadian economy as a whole, suggesting the key housing market will be a net drag on growth during the quarter and likely in the near term as starts and sales come off higher levels of previous years.
But analysts added that the recent slow descent from very high altitudes in a sector that some calculate is overpriced by as much as 25 per cent and overbuilt — especially in Vancouver and Toronto — is actually what the doctor ordered and may hold off a punitive collapse.
“The slowdown suggests we are not crashing, people are not panicking, especially condo builders,” said Benjamin Tal, a senior economist with CIBC World Markets.
“All the indicators we are seeing as of today, in the resale market and in the housing start market, suggest this is a market that is slowing softly. We should be in the neighbourhood of 170,000 to 180,000 in housing starts and we should be getting there.”
Regionally, urban starts decreased 15.7 per cent in Ontario on a seasonally adjusted annual rate and were down 13.5 per cent in Quebec.
However, urban starts jumped 27.1 per cent in Atlantic Canada, were 13.8 per cent higher on the Prairies and 13.1 per cent higher in British Columbia.