The rate of urban starts decreased 21.6 per cent month-over-month to 144,800 in November, with declines in all parts of the country as volatile multiple starts tumbled 29.1 per cent to 81,700 while single-family starts eased 9.0 per cent to 63,100.
The November numbers "remain consistent with our forecast, which calls for more moderate activity of 212,000 units this year and 178,000 units next year," commented CMHC economist Bob Dugan.
"Note that at the beginning of the new millennium, Canada posted strong housing start levels given a pent-up demand that existed then. Over the last few years, this excess demand gradually decreased and our forecast for 2008 and 2009 reflects this new reality, with housing starts more aligned with long run demographic demand."
For the first 11 months of 2008, total residential construction starts were down 7.6 per cent compared with the corresponding period of last year, with urban single starts down 18.4 per cent but multiple-unit starts up 8.6 per cent.
The CMHC numbers concide with a Royal Bank report saying the housing sector is entering a cyclical downturn but the risk of a U.S.-style meltdown is remote.
RBC senior economist Robert Hogue says many factors that triggered the U.S. housing collapse are absent or much less evident in Canada.
He predicts the housing market will hold up even as a sluggish economy threatens income growth and erodes consumer confidence, because subprime mortgages are not prevalent in Canada, while the banks are stable and households are generally not overstretched financially.
"These factors should provide enough of a foundation to prevent housing markets from spiralling down even as the Canadian economy slips into recession," Hogue added.
0 comments:
Post a Comment