Landlords brace for construction spree

"The trend in total housing starts continued to be relatively stable in July, remaining within a narrow range (since) March 2013," said Mathieu Laberge, deputy chief economist at CMHC. "For the past few months, total housing starts have followed the stabilizing trend observed in sales of existing homes earlier this year."

Stability aside, the growing number of new homes expected to hit the market in the next 24 months -- primarily condos and townhomes -- will challenge investor-landlords now enjoying rock-bottom vacancy rates.

Analysts suggests that most markets will continue to favour property investors but that an increase in supply will result in rental price easing.

That, of course, will accrue to the benefit for renters, says Lila Grande, an Ottawa landlord, with 40 doors in her portfolio.

"I think the fact that developers haven't significantly slowed their building despite the mortgage rules being clamped down on," she says, "suggests that we will continue to see a rise in rental inventory and more competition against landlords."

That trend won't be limited to Ontario.

According to the CMHC report, July's seasonally adjusted annual rate of urban starts increased in British Columbia, among other metropolitan centres considered to be in cool-down mode.

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