July 2012 CMHC Data - Vancouver CMA

Here are mohican/VHB's charts for housing starts, completions, and under construction for Vancouver Census Metropolitan Area (CMA) to July 2012, with August preliminary housing start data:

The last few months have seen a continued lag of completions and an increasing amount of starts and under construction volume. Completions are trending upwards but the delay relative to starts is on the long end of what has occurred historically. We should anticipate an eventual increase in completions through the remainder of 2012 and into 2013.

Here is a breakdown of the new persons per bedroom start and completion, assuming 4 bedrooms per detached and 1.6 bedrooms per multi. The higher the number the more population growth there is per start/completion and this would tend to lead to higher unit absorption. In contrast a lower value would mean less absorption. As we can see Vancouver new persons per bedroom-start continues to trend lower once again, in part due to lower population growth of late.

Below we can see a continued high level of multi-unit construction compared to detached construction.

One of the risks facing Vancouver and BC GDP growth is a continued below-trend population growth due in part to unemployment differentials with other parts of the country, in turn wrought by over-investment, particularly in residential structures. If this event occurs, one need only refer to the early 2000s to see the starts and completions are likely to head, and what that would mean for construction employment and BC's GDP growth.

Should population growth remain subdued, resulting lower GDP growth of future years would, in my view, be most reasonably attributed to previous investment excesses, not then current conditions.