Canada Housing Starts Fall 22% in August — Update

By Paul Vieira

OTTAWA--Canadian housing starts fell sharply in August, dropping to their lowest level in nine months due to a pullback in the construction of multi-unit dwellings, like condominiums and row houses.

Canada Mortgage and Housing Corp. said Tuesday that housing starts in August across the country totaled 217,405 units on a seasonally adjusted, annualized basis, or a 22% drop from the prior month. The August result missed market expectations by a wide margin - with traders looking for housing starts to hit 245,000, according to economists at Bank of Nova Scotia.

The trend measure--a six-month moving average of the monthly seasonally adjusted annualized rate of housing starts--fell 2.9% to 248,480 units.

Data this week indicated that real-estate activity remains lackluster, even though the Bank of Canada is at the start of a rate-cutting cycle that economists believe will continue through the first half of next year. On an unadjusted basis, existing-home sales in August fell 2.1% from a year ago. Prices remain unchanged from the prior month, but declined 4% from August of last year.

The CMHC monthly report said housing starts in urban centers with populations of 10,000 and more fell 24% in August, led by a nearly 30% drop in multi-unit dwellings. The biggest month-over-month drops were recorded in Ontario and British Columbia.

The last time housing starts in Canada fell to such a low level was in November of last year, when they reached 210,678.

Write to Paul Vieira at paul.vieira@wsj.com

(END) Dow Jones Newswires

September 17, 2024 09:05 ET (13:05 GMT)

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