Canadian housing shows strength as prices, starts rise

Thu Mar 8, 2012 11:30am EST
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By Jon Cook

TORONTO (Reuters) - The Canadian housing market continued to show signs of strength on Thursday as data revealed new home prices rose for the 10th straight month in January and housing starts climbed in February despite expectations the sector will slow this year.

Prices of new homes edged up 0.1 percent in January from December, the 10th consecutive monthly increase, mainly on strength in Calgary and Vancouver, Statistics Canada said on Thursday.

The rise matched analysts' expectations. Compared with a year earlier Statscan's price index was up 2.4 percent, slightly down from 2.5 percent year-on-year growth in December.

Overall, prices were up in eight regions in January, held steady in nine, and dropped in four. Calgary and Vancouver both posted 0.3 percent advances over December. The largest region that Statscan measures, Toronto and Oshawa, Ontario, was flat.

Housing starts rose in February from the previous month as a significant increase in multiple-unit construction in Quebec boosted the national number, Canada Mortgage and Housing Corp said.

The seasonally adjusted annualized rate of housing starts was 201,100 units, compared with 198,100 a month earlier. The January figure was revised up slightly from 197,900 units reported previously.

The number of starts was also mildly above the consensus expectation of analysts, which had called for 200,000 starts.

"Multiple housing starts in Quebec had fallen nearly 50 percent in January, so February's rise can be seen as a return to a more normal rate of construction," CMHC Deputy Chief Economist Mathieu Laberge said in a statement.   Continued...