Toronto condo market carrying housing starts

Slumping February numbers for housing starts nationwide in no way reflected the spectacular growth shown in Toronto.

Toronto bucked the national trend, showing a 7 per cent increase in single detached from 561 in February 2012 to 602 for last month. More dramatically, all other starts – which include apartment dwellings, townhouses and condominiums – climbed from 1,738 to 2,678, a 54 per cent increase from February of 2012.  “The trend in total housing starts continued to moderate in February,” said Mathieu Laberge, Deputy Chief Economist at CMHC. “Moderation in economic fundamentals in the second half of 2012 has led to more modest housing demand and builders are adjusting accordingly.”

Single-detached numbers for February compared to the same month last year were down from 3,018 to 2,829 for this year nationwide. All other starts during the same period also dropped from 7,606 to 6,519.

Vancouver posted strong single-detached numbers, with 279 new starts for February 2013 compared to 195 starts in February 2012; yet slumped in all other starts from 1,675 to 833 during the same period.

Nationwide, CMHC reported housing starts trending at 195,087 units for February, calculated on the six-month moving average of the monthly seasonally adjusted annual rate (SAAR) of housing starts. The SAAR trending measure is used as a complement to the monthly SAAR of housing starts, to account for the considerable swings in the monthly estimates. The standalone monthly SAAR was 180,719 units in February, up from 158,998 in January.

The Toronto condo market remains strong despite a quarter-to-quarter rise in unsold condominiums. For the fourth quarter 2012, 79 per cent were sold, compared to 80 per cent in the third quarter, and 82 per cent a year earlier. However, it is above the 78 per cent 10-year average.

By Donald Horne