Canada housing starts climb in November, permits edge up in Oct

Mon Dec 8, 2014 9:48am EST
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By Andrea Hopkins

TORONTO Dec 8 (Reuters) - Canadian housing starts rebounded as expected in November and building permits edged higher in October, two reports showed on Monday, suggesting the closely watched housing market held momentum heading into the traditionally slower winter season.

A report from the Canada Mortgage and Housing Corp showed the seasonally adjusted annualized rate of housing starts rose to 195,620 units in November, from 183,659 in October.

Analysts surveyed by Reuters had forecast 195,000 starts.

"The result was close to expectations, and continues to suggest that overall homebuilding activity in Canada is running about in line with what is needed to satisfy demographic demand and some replacement," Robert Kavcic, senior economist at BMO Capital Markets, said in a research note.

A separate report from Statistics Canada showed the value of Canadian building permits edged up 0.7 percent in October to C$7.53 billion ($6.61 billion), cooling after the previous month's sharp gain as construction intentions for residential homes slipped.

Economists expected a decline of 1.4 percent after a surge of more than 12 percent in September. The figures are seasonally adjusted.

The Bank of Canada has expressed some concern about household imbalances, particularly a high level of debt accumulated in mortgages as Canadians stretch to get into the nation's expensive housing market. Interest rates are near historic lows and are expected to stay there until late in 2015, fueling heavy borrowing.   Continued...