Canadian Housing Starts (June 2024)

Housing starts take a step back in June

• Canadian housing starts came in at 241.7k annualized units in June, representing a 9% month-on-month (m/m) decrease from May's level. The six-month moving average of starts dipped to 247.2k units.
• June's decline was concentrated in the multi-family sector, with urban starts down 12% m/m to 180.2k units. Meanwhile, urban single-detached starts declined by a more modest 2% to 43k units.
• Urban starts were down in 6 of 10 provinces: 
  
  • Most of the drag was driven by starts in Ontario (-19k to 65.1k units). They also pulled back in B.C. (-5.3k to 38.9k units) and Quebec (-1.5k to 46.9k units). Starts in the Atlantic region were relatively unchanged, with decreases in New Brunswick and PEI being offset by gains in Nova Scotia and Newfoundland.
  • Starts picked up in the Prairies (+2.3k to 54.4k units), supported by gains in Manitoba and Saskatchewan. 

Key Implications

• In the second quarter, urban starts averaged 230k units, slightly higher than in Q1. The improvement points to a modest positive contribution to residential investment and overall economic growth for the quarter.
• Despite June's anticipated pullback, starts remain well above pre-pandemic levels, as builders have broken ground at elevated rates for purpose-built rental and condo units. However, we believe this tide will turn and starts will trend lower on the back of weak pre-sale activity in key markets and elevated input costs.           

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