Tag Archives: Housing starts

Creeping mortgage rates are part of housing market’s soft landing

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The reports of the demise of Canada's housing sector appear to have been greatly exaggerated. According to the Royal LePage House Price Survey, housing prices across the country continue to post relatively modest gains, and home loans have been kept in check, leading to market stability. And, defying those who had predicted an imminent collapse, it doesn't appear there will be any extreme price movement either way through at least the end of 2013 and probably into 2014.

Avoiding the housing bubble
Four different sets of rules have been issued by the Department of Finance since the worldwide housing bubble collapse in 2008, all of which increased lending restrictions. Those efforts, along with the creeping rise in mortgage rates over the past few months, appear to have helped the Canadian housing sector into a soft landing, avoiding any possible catastrophe. Continue reading →

Canada’s housing market to slowly rise by the end of 2013 and into 2014

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The Canada Mortgage and Housing Corporation (CMHC) said that the housing market will pick up momentum in the later part of this year and into 2014.

David George-Cosh said in a blog for The Wall Street Journal that if this prediction sounds familiar, it's because it's similar to the outlook of an agency report in February, but with revisions downward for 2013 and 2014.

What are the current predictions?
The CMHC now forecasts starts of 182,900 units this year, down from the first quarter unit estimate of 190,300. In 2014, housing starts are expected to be at 188,900 units. The CMHC predicts resales will be at 443,400 in 2013 and 468,600 in 2014. Continue reading →

Canadian markets continue to see housing growth

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Despite indications of a housing cool down throughout the country, certain markets within Canada are continuing to see a boom in real estate activity.

Housing market sees declines during fall
Data from the Teranet-National Bank National Composite House Price Index shows that while home prices were up by an average of 3.4 percent across the nation on a year-over-year basis during October, prices had actually dropped from the previous month. October also marked the 11th consecutive month of deceleration in year-over-year price increases. The index dropped by 0.2 percent from September to October, marking only the third time in 13 years that October recorded a month-over-month home price decline.

In addition, a new report from the Macdonald-Laurier Institute shows that while economic growth is growing in Canada, the housing market is projected to be replaced by manufacturing and exports.  Continue reading →

Housing market holds steady despite cool-down

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While financial analysts love to exalt the health of the market one minute and beat the drum for doom and gloom the next, the truth usually falls somewhere in the middle. It doesn’t make for as exciting newspaper copy, but all markets work in cycles and waves, growing and shrinking based on any number of economic factors. Despite the amount of ink being devoted to Canada’s cooling housing market, consumers should feel safe in the knowledge that while there may be some financial belt-tightening on the horizon, it’s not the end of the world.

At least, that’s the takeaway from the new forecast by the Canada Mortgage and Housing Corporation.

“A weaker outlook for global economic conditions and the waning of the effect of pre-sales from late 2010 and early 2011, which contributed to support multi-family starts this year, will bring moderation in housing starts next year,” said Mathieu Laberge, deputy chief economist at CMHC. “Nevertheless, employment growth and net migration will help support housing starts activity going forward.” Continue reading →

Gehry moves on huge condo project despite cooling market

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The Canadian housing market is cooling down, but someone forgot to tell Frank Gehry and David Mirvish.

Gehry, the man Vanity Fair once described as "the most important architect of our age,” has unveiled plans for a gargantuan condominium project in downtown Toronto. With funding from theater promoter David Mirvish, Gehry’s design will incorporate three 85-floor towers sitting atop two six-story podiums.

The developers held a news conference officially announcing the project on October 1.

“I am not building condominiums,” said Mirvish. “I am building three sculptures for people to live in.”

The towers, which will feature residential, retail and gallery space, would be the tallest residences in North America.

Unfortunately for Gehry and Mirvish, these skyscrapers will have to compete with a gluttony of unsold spaces built during Toronto’s condo boom. Continue reading →

Positive U.S. housing market could indicate great things for Canada

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In a recent article, we addressed the fact that analysts and mortgage pros are a bit concerned by the state of Canada's housing market and likened it to a "slow-motion version of what happened in the U.S." Remember that?

The good news for Americans is that the U.S. housing market is improving – maybe not by leaps and bounds, vast improvements nonetheless. The even better news is that U.S. housing market gains can be a really great thing for the Canadian economy and even stimulate economic growth in many different ways.

According to a recent article in the Winnipeg Free Press, the increased American housing activity and positive change for U.S. homeowners and prospective buyers marks the possible end of the four-year recession and plenty of economic woes. Unemployment rates are still soaring and improving at a snail's pace – if that. However, economic recovery is on the horizon, despite its recovery rate hovering near 1.7 percent annually. Continue reading →

Canadian dollar, housing starts surpass economists’ expectations

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In wonderful news of the month, the Canadian dollar is up and recently closed at a 13-month high. Way to go, loonie! Although this may be for several reasons, experts suggest it was caused by expectations that the U.S. Federal Reserve is planning a stimulus for the U.S. economy. Recent closing numbers reflected an increase of 0.45 of a cent to the U.S. $1.0275, according to The Globe and Mail.

The value of the U.S. dollar continued to suffer leading up to a two-day meeting that may result in the U.S. government printing more money as a means to keep interest rates low and encourage lending.

However, in more positive news of the month that only strengthened the Canadian dollar's value, economists were pleasantly surprised at the increase of housing starts as reported by the Canada Mortgage and Housing Corporation (CMHC). Instead of its prediction – a decline to 200,000 home starts in August – coming true, housing starts came in at an annual rate of 224,900 during the month. Continue reading →

Building permits down, new construction could slow

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Canada may soon experience a slight slowing in the housing market – a key indicator of market growth was down in April, which could mean fewer homes on the market in the coming months.

The total value of building permits in Canada, which serve as an early indicator of new home construction levels, fell 5.2 percent, Dow Jones Newswire reported. The numbers come from an estimate by economists at the Royal Bank of Canada. They indicate that construction in most sectors, from schools and hospitals to single-family homes and condominiums, will probably tick downward in the not-too-distant future.

Permits for single-family homes saw the smallest declines, falling just 2 percent over the previous month, while multi-family units, including condos, dropped 4 percent, according to the source. The largest declines were seen in Ontario, specifically Toronto, where housing prices and condo construction have been on a veritable upward stampede. Continue reading →

Canadians build quarter of a million new homes in April

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Like flowers blooming in the spring, the Canadian countryside has seen a veritable bouquet of new houses pop up in the last month. The Canadian Mortgage and Housing Corporation recently announced housing starts in April hit 244,900, far surpassing most analysts' expectations.

The seasonally adjusted numbers were up 14 percent from March, and roughly 20 percent above industry experts' predictions. A Bloomberg sampling showed most Canadian real estate experts anticipated there would be 204,000 starts in April. Just 67,700 of the starts were single-family detached homes.

“Most of the increase was in the multiples segment,” said Mathieu Laberge, deputy chief economist at CMHC’s Market Analysis Centre. "The increase in this segment is partly a reflection of the high level of pre-sales in large multi-unit projects since 2011, which is in line with job gains over the last year." Continue reading →

New Brunswick records increased housing starts for February

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A recent report from the Canada Mortgage and Housing Corporation reveals that residential construction activity in New Brunswick's urban centers increased in February.

Preliminary data from the CMHC shows that a total of 25 starts were recorded during the second month of the year, compared with 22 starts during that same time last year.

"The rise in single starts was partially offset by fewer multiple starts during the month of February," said Claude Gautreau, CMHC's senior market analyst for New Brunswick.
Continue reading →