New housing construction trends in Canada's largest cities

OTTAWA, ON, Oct. 18, 2022 /CNW/ - After a boom recorded in 2021, housing starts in the country's six largest census metropolitan areas (CMAs) fell 5% in the first half of 2022. The decrease in apartment construction (-9%) is the main cause of this drop. This according to the latest edition of Canada Mortgage and Housing Corporation's (CMHC) Housing Supply Report, which examines new housing construction trends in Canada's six largest CMAs of Vancouver, Calgary, Edmonton, Toronto, Ottawa and Montréal.

Housing Supply Report CMHC (CNW Group/Canada Mortgage and Housing Corporation)

Gains in new housing construction in Toronto, Calgary and Edmonton, were offset by declines in Vancouver, Montreal and Ottawa.

``In the first half of 2022, housing starts were mixed across Canada's largest urban centres. Rental construction was generally resilient, due to strong demand for this type of housing, while developers took a more cautious approach to starting new condominium apartment projects, due to the higher interest-rate environment,'' said Francis Cortellino and Eric Bond, Senior Specialists for housing market analysis for CMHC. ``Increases in construction costs and materials shortages were also felt across markets, impacting construction times and the affordability of the housing delivered."

Along with reporting on the latest trends in new home construction, this edition of the Housing Supply Report also examines the evolution of construction costs and construction time for different dwelling types in Canada's six largest urban centres.

You can download and read the entire Housing Supply Report on the CMHC website.

Report Highlights:

• In the Vancouver CMA, housing starts declined by about 25% in the first half of 2022. This slowdown was mainly due to a decrease in the number of condominium apartments started, owing to the greater number of rental apartments started. Vancouver's low vacancy rate, in a more uncertain economic environment for buyers, led residential property developers to turn to the rental segment.

• Housing starts for all dwelling types were down in the Montréal area. After a temporary rebound in activity at the beginning of the pandemic, driven by a change in preferences, the construction of houses declined sharply. After hitting historic levels last year, apartment starts also declined.

• Toronto had the largest number of housing starts in the first half of 2022 (19,520, up 7%). While the construction of apartments and row houses increased in Toronto, the construction of generally less affordable housing types (single-detached and semi-detached houses) decreased.

•  In Ottawa, housing starts declined for almost all dwelling types. The decrease was particularly significant in the single-detached and condominium apartment segments, where the level of construction was very high between January and June of 2021. Rental apartments, however, recorded an increase, with low vacancy rates stimulating construction.

• Both Calgary and Edmonton CMAs have seen housing starts increase by about 20% since the beginning of the year. In Calgary, construction increased for all types of housing. Low stock and strong demand played a role in this expansion.

We strongly believe that better, more informed housing decisions are made with the availability of quality housing market data and insights. The Housing Supply Report aims to increase understanding on the state of housing supply before providing insights on the gaps and opportunities. We'll continue to share new data, indicators and insights exploring different aspects of housing supply in Canada.

Related Links:

• Canada's housing supply shortage: skilled labour capacity
• Understanding Canada's housing supply shortages
• Increasing our understanding of housing supply in Canada

Information on this release:

We encourage journalists to contact CMHC Media Relations and arrange speak to our market analysts for Vancouver, Calgary, Edmonton, Toronto, Ottawa and Montréal, who contributed to the Housing Supply Report.

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SOURCE Canada Mortgage and Housing Corporation

Media Relations, CMHC, [e-mail]