Housing starts show rebound
Figure still shy of level seen in 2008
By Dan Healing, Calgary Herald
February 9, 2010
The home building industry in Calgary staged a strong rebound in January from last year's 18-year depths, but failed to recoup all the ground lost since the same month in 2008.
According to Canada Mortgage and Housing Corp., total housing starts in the city reached 514 units last month, more than double the 243 in January 2009 but 28 per cent lower than the 711 units started in January 2008.
Richard Cho, CMHC's senior market analyst for the city, said the general direction for new housing is stable.
"Housing activity is encouraging in January. It's a good start to the year," he said.
"We're still seeing a fair number of singles being started, if not the same level of activity we saw in the latter part of 2009. The momentum is still being carried over to this year."
He said fewer incentives are expected to be available for buyers this year due to the stronger market, but higher interest rates expected at midyear will tend to prevent the market from growing beyond a sustainable level.
Todd Hirsch, senior economist for ATB Financial, agreed 2010 will be stable, noting a cold January also likely slowed housing start statistics.
"It's coming off a bit of a surge we saw in fall of last year . . . (but) there's no sign that housing starts are collapsing at all," he said. "They're up from where they were a year ago, so that's positive, and overall I think we'll have a balanced year of housing starts."
He said there will be fewer construction jobs on commercial projects this year, but more in home building and institutional and infrastructure projects.
Both single-detached and multi-family housing starts were up in January, with builders starting work on 413 homes, versus 204 units a year earlier, and 101 multifamily units breaking ground, up from 39 units in the previous year.
Cho said there were no apartment units started, reflecting the oversupply of inventory in Calgary. He predicted the trend this year will be toward medium-density housing.
The peak January for single-family starts came during the overheated economy of 2006, when 838 houses contributed to 1,086 housing starts.
The more volatile multifamily sector posted its biggest January in 1978, when 1,718 units were started.
Provincially, housing starts in Alberta's seven largest centres totalled 1,271 units in January, up 52 per cent from January 2009.
Nationally, the seasonally adjusted annual rate of housing starts reached 186,300 units in January, up from an annual rate of 176,100 units in December.
According to final figures, housing starts for 2009 totalled 149,081 units, with activity improving as the year progressed.
In the Prairie region, the seasonally adjusted annual rate of urban starts decreased by 4.8 per cent in January from the previous month.
Also on Monday, the Canadian Real Estate Association revised its forecast for MLS home sales in 2010.
It forecasts national sales activity will reach 527,300 units in 2010, up 13.3 per cent from 2009. This would represent an annual record -- 1.2 per cent above the previous peak in 2007.
Sales in Alberta are forecast to be 63,050, up 9.1 per cent from 2009.
Figure still shy of level seen in 2008
By Dan Healing, Calgary Herald
February 9, 2010
The home building industry in Calgary staged a strong rebound in January from last year's 18-year depths, but failed to recoup all the ground lost since the same month in 2008.
According to Canada Mortgage and Housing Corp., total housing starts in the city reached 514 units last month, more than double the 243 in January 2009 but 28 per cent lower than the 711 units started in January 2008.
Richard Cho, CMHC's senior market analyst for the city, said the general direction for new housing is stable.
"Housing activity is encouraging in January. It's a good start to the year," he said.
"We're still seeing a fair number of singles being started, if not the same level of activity we saw in the latter part of 2009. The momentum is still being carried over to this year."
He said fewer incentives are expected to be available for buyers this year due to the stronger market, but higher interest rates expected at midyear will tend to prevent the market from growing beyond a sustainable level.
Todd Hirsch, senior economist for ATB Financial, agreed 2010 will be stable, noting a cold January also likely slowed housing start statistics.
"It's coming off a bit of a surge we saw in fall of last year . . . (but) there's no sign that housing starts are collapsing at all," he said. "They're up from where they were a year ago, so that's positive, and overall I think we'll have a balanced year of housing starts."
He said there will be fewer construction jobs on commercial projects this year, but more in home building and institutional and infrastructure projects.
Both single-detached and multi-family housing starts were up in January, with builders starting work on 413 homes, versus 204 units a year earlier, and 101 multifamily units breaking ground, up from 39 units in the previous year.
Cho said there were no apartment units started, reflecting the oversupply of inventory in Calgary. He predicted the trend this year will be toward medium-density housing.
The peak January for single-family starts came during the overheated economy of 2006, when 838 houses contributed to 1,086 housing starts.
The more volatile multifamily sector posted its biggest January in 1978, when 1,718 units were started.
Provincially, housing starts in Alberta's seven largest centres totalled 1,271 units in January, up 52 per cent from January 2009.
Nationally, the seasonally adjusted annual rate of housing starts reached 186,300 units in January, up from an annual rate of 176,100 units in December.
According to final figures, housing starts for 2009 totalled 149,081 units, with activity improving as the year progressed.
In the Prairie region, the seasonally adjusted annual rate of urban starts decreased by 4.8 per cent in January from the previous month.
Also on Monday, the Canadian Real Estate Association revised its forecast for MLS home sales in 2010.
It forecasts national sales activity will reach 527,300 units in 2010, up 13.3 per cent from 2009. This would represent an annual record -- 1.2 per cent above the previous peak in 2007.
Sales in Alberta are forecast to be 63,050, up 9.1 per cent from 2009.
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