"As expected,” said Mathieu Laberge, deputy chief economist at CMHC, “the number of multiples starts in Ontario, particularly in Toronto, reverted back to a level more in line with the average pace of activity over the last six months."
More specifically, the seasonally adjusted annualized rate of housing starts for September was 220,215 units, more than 5,000 down from the previous month. Still the activity was more than most economists had projected, with expecatations housing starts would come in just above 207,000 for September.
The slowdown is directly tied to a slowing residential construction centre and the more restrained condo construction starts many Toronto observers have been hoping for.
"Following a period of elevated housing starts activity due to strong volumes of multi-family unit pre-sales in 2010 and 2011, the pace of housing starts is expected to moderate," Laberge said.
Still, that isn’t to say developers aren’t moving ahead with construction on more than 200,000 units over the next 16 months.
That could further challenge the flipping strategy of many condo investors as prices start to slip and buyers start to scatter.
In fact, RealNet’s index price for new units in the Greater Toronto Area fell nearly 5 per cent in August from a year ago to $436,460. The number of sales also took a dive, sliding to 645 from 1,967.
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