Canada’s housing market showed signs of resilience in October, as the seasonally adjusted annual rate (SAAR) of housing starts rose by 8% to 240,761 units compared to September, according to the Canada Mortgage and Housing Corporation (CMHC). However, the six-month trend in housing starts remained flat at 243,522 units, reflecting ongoing challenges in meeting demand.
Bob Dugan
“Actual year-to-date housing starts are similar to last year, but we continue to see higher activity in the Prairie provinces, Québec and the Atlantic provinces, while Ontario and British Columbia have seen declines in all housing types. The increases in the monthly SAAR in Toronto and Vancouver are a promising sign for Ontario and British Columbia, as they drove the national SAAR increase in October. Despite these results, we remain well below what is required to restore affordability in Canada’s urban centres,” said Bob Dugan, Chief Economist at CMHC.
Key Findings:
- Urban Housing Starts: The SAAR for urban housing starts (centres with populations of 10,000 or more) increased by 6% to 223,111 units. Multi-unit starts drove the growth, rising 7% to 175,705 units, while single-detached starts edged up by 1% to 47,406 units.
- Rural Contributions: Rural starts added 17,650 units to the monthly SAAR.
- Year-to-Date Activity: As of October 2024, urban housing starts totaled 188,567 units, nearly unchanged from 187,722 during the same period in 2023.
- Regional Performance:
- Montreal: Starts are up 12% compared to last year, rebounding from 2023’s lows.
- Toronto: Starts have declined 21% year-to-date but remain relatively high when considering historical averages.
- Vancouver: Starts dropped 18%, following a record-setting year in 2023.
Despite the October increase, the long-term trend underscores a broader issue: insufficient new housing supply to match demand.
Rishi Sondhi, Economist with TD Economics, said October’s healthy starts level is consistent with the signal sent from September’s strong building permits report.
“It also sets homebuilding off on the right foot in terms of its contribution to overall economic growth in the fourth quarter,” said Sondhi.
“Even with October’s gain, the outlook for housing starts remains soft. This is largely due to the outsized weakness expected for Ontario, which will bring down the national figures. We’d note that over the last 12 months, starts have tumbled to levels last seen in 2020 in Ontario. Pre-sales activity remains exceedingly weak in the GTA, pointing to more of the same through 2025. This is the key factor underpinning our forecast that starts will decline next year, even with homebuilding likely to hold up better in other parts of the country.”
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list. He was also named by RETHINK to its global list of Top Retail Experts 2024.
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