December 9, 2011
Below is a press release by Canadain Press dated Dec, 09, 2011.
A slowdown in apartment and condo construction in November resulted in the biggest one-month drop in Canadian home construction since early 2009, a report found Thursday, just as the Bank of Canada warned of a "heightened risk of a correction" in the multiple-dwelling segment of the market.
The Canada Mortgage and Housing Corp., a Crown corporation, reported the seasonally adjusted annual rate of housing starts dropped 13 per cent to 181,100 units in November, down from 208,800 in October.
It was a much larger decrease than economists expected, entirely driven by a 23 per cent drop in the multiple-unit sector, while the more stable single-family market rose 3.5 per cent.
The CMHC report was released the same day the Bank of Canada warned that the country's robust housing market -- and over-leveraged mortgage holders -- could be in for a shock if the global economy goes south.
Read the full report.
Economists and other observers have been watching for signs of a housing bust in Canada, but there has been little evidence of a bubble, apart from the multiple-dwelling segment and the general Vancouver market.
Home sales in Greater Vancouver had been on gradual declince the past 6 years. The condo market is more vulnerable to steeper sales and price decline if home buyers continue to hold off their buying for now.
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