Housing starts picked up in November in the Vancouver area after a weak October , according to Canada Mortgage and Housing Corporation data released December 8.
A total of 31,980 units were started in the Vancouver Census Metropolitan Area (CMA), up from 11,993 in October, setting the stage for 2016 to be a record year. Starts were trending at 27,495 units in November; this is a measure of six-month moving average of monthly seasonally adjusted annual rates. In October, housing starts were trending at 26,082.
“Starts in Vancouver bounced back strongly in the month and are on pace for the largest annual tally since at least 1990,” said BMO senior economist Robert Kavcic.
According to Robyn Adamache, CMHC principal market analyst for Vancouver, the boost is related to a large number of apartment starts.
“2016 is shaping up to be a record year for housing starts as builders add much-needed supply in the region,” Adamache said.
The number of units started also increased across British Columbia in the month, with 44,019 units being started in November, compared with 25,049 units in October. Starts were trending at 39,309 units, up from 37,757 in October.
TD Economics’ Diana Petramala pointed out that these record levels are coming in spite of a correction that is underway in the market for existing homes.
“This likely reflects a combination of the lags between housing demand and new home construction and the shift in demand preferences from the existing home market to the new home market for first time homebuyers,” Petramala said. “In its last budget, the B.C. government exempted first-time homebuyers from the land transfer tax on new builds priced under $750,000.
“It is estimated that over 10,000 households have already taken advantage of this tax saving.”
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