Canadian Housing Starts Decline in November: CMHC
Canadian construction projects for new single-family homes declined at an annualized rate of 3 percent in November, according to the Canadian Mortgage and Housing Corporation. Housing starts fell to a seasonally adjusted annual pace of 192,235, compared to expectations for 194,500.
Housing starts capture monthly and annualized changes in the number of new single-family homes or buildings under construction. The indicator is used to gauge the strength of the residential real estate market, which has broader implications on the economy.
The seasonally adjusted annual rate of urban home starts increased in the western provinces of British Columbia, Alberta, Saskatchewan and Manitoba, and decreased in Ontario and the Atlantic provinces. The pace was relatively unchanged in Quebec. In total, the SAAR of urban home starts decreased 3.4 percent to 171,347 in November.
Housing starts have been increasing slightly since July, according to the CMHC. The trend began stabilizing in November, consistent with trends in existing home sales.
“As sales rise relative to listings of existing homes, buyers are increasingly meeting their needs in the new home market,” said Matthieu Laberge of CMHC.
In October the CMHC reduced its forecast for Canadian housing starts. Canada’s largest housing agency said construction projects for new dwellings will reach 184,700 units in 2014, compared to an earlier estimate of 186,600 units.
The Canadian dollar was trading to the downside following the news, as the near-term outlook on the true north’s economy continues to wane. As of the early North American session, one loonie buys you 0.9380 US cents. The Canadian dollar has lost more than 1.7 percent over the last four weeks, as market participants continue to unload commodity-driven currencies for safer bets. The once evenly matched loonie has declined more than 6.5 percent in 2013.
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