May 2013 Housing Starts and Permit Data - Vancouver CMA

Here is the chart for housing starts, completions, and under construction for Vancouver Census Metropolitan Area (CMA) to May 2013:

Below we can see a continued high level of multi-unit construction compared to detached construction. The long-term trend for detached construction has been down.

The last three years have seen an increasing amount of starts and under construction volume, the former of which now looks to have crested. Completions are trending upwards, as expected -- completions typically lag starts, so if starts are trending higher that will likely mean completions will trend higher as well. 12 months of completions are now 30% above the trough in 2011. (The actual trough was in early 2011.) With this increased level of completions, and what looks like either a plateaued or further-increasing level of completions into this year, we can expect increased competition among sellers continuing through 2013, as compared to 2012.

Despite recent resale malaise starts remain healthy -- at least not morbid -- pointing to continued construction activity -- and new supply -- over the coming quarters. Units under construction remain high.

Completed and unabsorbed for single and semi detached dwellings have eclipsed the highs seen during the last recession. I have plotted the completed and unabsorbed inventory as a percentage of the last 12 months of completions, to give a rough gauge of what percentage of single detached houses are unabsorbed compared to the completion rate. A high number of completed and unabsorbed is not necessarily cause for alarm if the total construction volume is high as well. The latter graph partially accounts for this.

Completed and unabsorbed as a percentage of a year's completions is as high as during the 2008-2009 recession.

Next, 12 months of Lower Mainland and BC permit data, both number of permits and value:

Notice the divergence of permits since mid-2010 between Vancouver and the rest of the province. Vancouver's population growth has remained more robust than the rest of the province of late, and it looks like one of the reasons for this has been increased residential construction activity.