Canada sees 22 percent decline in housing starts in August

(MENAFN) In August, Canada experienced a significant drop in housing starts, with figures showing a 22 percent decline compared to the previous month. According to data released by the Canada Mortgage and Housing Corporation (CMHC) on Tuesday, the number of new housing starts fell to 217,405 units from 279,804 in July. This substantial decrease was much larger than anticipated, with estimates predicting around 252,000 units.

The decline in housing starts marks a continuation of a troubling trend observed earlier in the year. In May 2023, the country had already witnessed a sharp 23 percent decrease, bringing the number of new housing starts down to 202,494 units—the lowest level recorded in over three years. This persistent drop underscores ongoing challenges in the Canadian housing market.

Despite the August figures, CMHC Chief Economist Bob Dugan noted that housing starts for the year to date have shown some growth. This positive trend has been driven by increased construction of multi-unit and single-detached homes in provinces such as Alberta, Quebec, and Atlantic Canada. However, the overall numbers still reflect a significant shortfall in housing development.

Dugan emphasized that the current levels of construction are insufficient to address the housing shortage effectively. To restore affordability in Canada's urban centers, he stated that much higher levels of construction are required. This continued shortfall in new housing starts highlights the urgent need for increased building efforts to meet the growing demand and alleviate affordability issues in the housing market.

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