Canadian housing starts decline for a second month
Canadian housing starts declined for a second month in August, adding to evidence that higher borrowing costs are slowing the market.
Work started on 200,986 homes last month at a seasonally adjusted annual pace, a decline of 2.3 per cent, Canada Mortgage and Housing Corp reported Tuesday from Ottawa. Multiple-unit projects declined by 2.4 per cent and single-detached starts by 2.6 per cent.
New residential construction has been gradually falling from elevated levels late last year and early 2018 as builders cope with the impact of higher interest rates. At the current pace, third-quarter home starts are on track for possibly the slowest quarterly pace since 2016.
“A more sluggish pace to home-building is in line with our expectation that higher interest rates and tighter lending standards turn this former stalwart of growth into a drag on the economy,” Royce Mendes, an economist at CIBC Capital Markets, said in a note to investors.