Canada August housing starts surge unexpectedly: CMHC
By Andrea Hopkins
TORONTO (Reuters) - Canadian housing starts surged unexpectedly in August as a few large multi-unit projects in Toronto, presold in late 2010 and early 2011, broke ground, data from Canada Mortgage and Housing Corp (CMHC) showed on Tuesday.
The seasonally adjusted annualized rate of housing starts was 224,900 units in August, up from 208,000 units in July and well above the 200,000 average forecast of analysts in a Reuters poll.
CMHC revised down the July figure slightly from the 208,500 units it reported previously.
"Volatility in housing starts numbers is always to be expected, but this month's data clearly shows that Canadian housing construction remains in high gear," Jacques Marcil, senior economist at TD Economics, said in a research note.
"The rest of the economy is growing much slower and as a consequence is not likely to be able to support this level of housing supply for much longer," he said.
Economists at the CMHC agreed, saying the August increase was the result of a few big Toronto condo projects and weakness in July that made August appear stronger.
"This increase is primarily a reflection of the high level of pre-sales in some of these large multi-unit projects in late 2010 and early 2011, which is in line with job gains at that time," Mathieu Laberge, deputy chief economist at CMHC's Market Analysis Centre, said in a statement.
"Overall, moderation in housing starts activity is still expected for the remainder of 2012 and 2013." Continued...