Homebuilding Slows As Housing Supply Hits Record Low In Canada
Statistics released this week from Canadian real estate authorities show that while the country’s stock of available homes for sale sits at record lows, the pace of building new units is also slowing. Canada Mortgage and Housing Corp. said the annual pace of housing starts in December fell 22 per ce
Statistics released this week from Canadian real estate authorities show that while the country’s stock of available homes for sale sits at record lows, the pace of building new units is also slowing. Canada Mortgage and Housing Corp. said the annual pace of housing starts in December fell 22 per cent when compared with November. The national housing agency said the seasonally adjusted annual rate of housing starts was 236,106 units for the final month of the year, down from 303,813 in November.
The Canadian Real Estate Association (CREA), meanwhile, said that home sales figures were relatively unchanged in the country from November to December. CREA senior economist Shaun Cathcart said the number of properties on the market in the final month of the year was a record low. New listings for December fell 15 per cent to 28,550 from 33,606 at the same time during the prior year.
“An aggressive national push to build more homes is what will address the issue, but it will probably have to be a greater amount of building than anything we’ve ever undertaken,” Cathcart said in a statement. “A touch over the status quo won’t cut it.” He added that Canada’s housing affordability problem will get worse before it gets better as a result of the short supply.
CREA reported that the national average home price hit $713,500 last month, up almost 18 per cent from the previous December. Markets such as Toronto and Montreal saw price inflation exceed the national average. Scotiabank senior economist Jean-Francois Perrault told Global News last week that it will take years of accelerated building pace to close the housing deficit in Canada.
An analysis from Scotiabank published last week showed Ontario, the province with the largest per capita housing gap, would need to build 650,000 homes to hit Canada’s already low bar for average housing levels. “If we don’t fix this, if we don’t right-size the number of homes in Canada or Ontario relative to population needs, things are never going to be more affordable,” he said.