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The seasonally adjusted annual rate of Canadian housing starts in the Q3 dropped to the lowest level since Q1 2023.
According to the Canada Mortgage and Housing Corporation, Q3 starts totaled 234,654, down 4.3% from Q2 and 8.2% year over year. Last year’s Q3 rate of 255,702 was the highest in any quarter in 2023 or so far in 2024.
On a monthly basis, September’s reading of 223,808 starts was the second lowest since last November, surpassing only the August total. Despite lower rates over the last two months, the annual pace through Q1-3 remains ahead of 2023 by 1.4%.
Kevin Huges, CMHC’s deputy chief economist, said growth in actual year-to-date housing starts is driven by higher multi-unit and single-detached units. This growth is seen in Alberta, Quebec, and the Atlantic provinces. “By contrast, year-to-date starts in Ontario and British Columbia have decreased across all housing types.”
Third quarter housing starts by province depict significant fluctuations. Ontario is the most active province for home construction. It reached 106,480 starts in the third quarter of 2022. In the third quarter of 2023, the province had 91,214 starts. This year, it plunged to 73,911, a decline of 31% from 2022.
Traders and distributors frequently report a dramatic downturn in demand for lumber and panels in Ontario. This substantiates those lower starts figures. Exorbitant home prices are among the major factors in the decline in home construction.
B.C. also experienced a sizable decline in third quarter starts, falling to 37,789 from 43,545 the previous quarter and 45,213 year over year.
Meanwhile, Quebec starts have begun to recover after a sharp one-year drop in 2023 of 33% from the prior year. The Prairies have shown greater strength over the last year. Quarterly ranges have been from 51,020 to 58,309. Prior to that, quarterly rates had declined to a little more than 38,000 in first and second quarters of last year.
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