Multi-family starts accelerated in April – CMHC

by Ephraim Vecina on 13 May 2020

As a whole, national multi-family starts surged upward last month, according to Canada Mortgage and Housing Corporation.

This came with one notable caveat, however. The study covering April “was conducted in each province with the exception of Quebec, following the introduction of pandemic measures in the province in late March,” CMHC said.

The Quebec government allowed residential construction in the province to resume on April 20.

Not taking into account Quebec, the national housing starts trend was 155,995 units in April, up from 153,463 units in March. Canada’s overall housing starts trend was 199,589 units in April, down from the 204,899 reading in March.

“Outside of Quebec, the national trend in housing starts increased in April, despite the impact of COVID-19 containment measures,” CMHC chief economist Bob Dugan said. “This reflects strong growth in multi-family starts in Ontario, Saskatchewan, and Manitoba.”

The upward trend will also offset any possible “declines in the near term” in these provinces, Dugan said. Such prolonged stability might feed into momentum that can help the housing market’s recovery after the crisis has passed, although Robert Hogue of RBC Economics predicted that the sector’s revival might be a bit delayed as buyers will need to “regroup and rebuild confidence amid high unemployment.”

“We see the outlook improving markedly next year in most markets,” Hogue said in a recent analysis. “Exceptionally low interest rates, strengthening job markets, and bounce-back in in-migration will generate substantial tailwind. We project home resales to surge more than 40% to 491,000 units in 2021.”

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