- Bob Dugan, CMHC's chief economist
Canada housing starts declined more than expected in October, falling to the lowest level in seven months, due to less construction of multiple-unit homes including condominiums. The report may ease concerns from Finance Minister Joe Oliver and Bank of Canada Governor Stephen Poloz about signs of overbuilding of condos in Canada's biggest cities. Canadian policymakers have expressed increasing concerns over the nation's continuously expanding residential sector, especially in light of low interest rate environment, which is boosting consumers' debt levels. The robust housing market that emerged in Canada following the global financial crisis has raised concerns that home prices could be due for a pullback.
Canada Mortgage and Housing Corp. reported that housing starts increased to an annualized rate of 183,600 last month, down from 197,400 in September and far below the 200,000 predicted by economists. Analysts had expected more strength in the housing starts, given recent strong building-permits numbers, which typically foreshadow new construction. Residential building permits, by number of dwelling, soared 9.4% in September, including a 12.9% surge in the multiples category.
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