CBC News - Last Updated: Monday, August 11, 2008 9:08 AM ET
Canada's housing industry showed more signs of softening amid reports of easing summer construction starts and slowing price increases for new homes.
Canada Mortgage and Housing Corp. said Monday that the seasonally adjusted annual rate of housing starts in July was 186,500 units, down from 215,900 in June.
Starts of urban multiple units, such as condominiums, dropped 20.2 per cent to 91,600, while starts of urban single homes eased 6.6 per cent to 69,800 units.
"After a strong first half of the year, the volatile multiple segment is now readjusting itself," said Brent Weimer, a senior economist at CMHC's market analysis centre. "This brings activity since the start of the year closer in line with our 2008 forecast of more than 200,000 housing starts for the seventh consecutive year."
Meanwhile, Statistics Canada also reported Monday that new housing prices in June increased at their slowest pace in over six years. That continued a slowdown that started in September 2006, the federal government agency said.
The June decline reflected a softening housing market in Western Canada, Statistics Canada said.
Across the country, contractors' selling prices rose 3.5 per cent between June 2007 and June 2008. That was down from the 4.1 per cent year-over-year increase in May.
The June increase was the slowest rate of growth since March 2002 when year-over-year prices increased by 3.4 per cent.
Here is the Vancouver Sun story. Vancouver area builders obviously didn't get the memo. Or maybe they did and know better?
ReplyDeleteOff topic
ReplyDeleteGold sure has taken a beating over the last few weeks. Where is our local gold bug Randallbard?
Mohican, do you know much about currency trading? Where do you think our dollar is headed? And is the US dollar getting stronger due to a more wide spread global economic weakness?
The interesting part of that V Sun story is that "The gain was entirely in muli family units".
ReplyDeleteThe buzz is that small time spec house builders have shut down completely.
As for gold, it sure looks like we're getting close to an upwards pop. Not a gold bug by any means, but got HGU in my crosshairs and finger not far from the trigger.
"The buzz is that small time spec house builders have shut down completely.
ReplyDeleteSingle family unit starts only dropped 3% so somebody is still building. I think the spec builders should shut down completely so likely they're continuing to start new stuff even now.
jesse,
ReplyDeleteMy guess would be that those starts are being built on contract rather than spec. Owners probably feel they're getting more value now with lower material cost and availability of more subtrades.
"My guess would be that those starts are being built on contract rather than spec."
ReplyDeleteMaybe more so than before however I still see for sale signs in front of newly minted houses. Somebody is in effect a spec builder, just maybe not the actual building company. In the end somebody's holding the bag; I have no problem believing most of the true builders can see the writing on the stucco wall.
And is the US dollar getting stronger due to a more wide spread global economic weakness?
ReplyDeleteA weak US economy means a stronger USD because the US consumer cuts back on imports. Remember that ~70% of the US economy is consumer spending. Exportable output in the US, such as it is, is growing as a % of the economy as consumer spending weakens.
The US economy hasn't really been "strong" for a decade, it's just been in two bubbles.