Canadian housing starts picked up in June, and Toronto is doing its job to keep pace.
New construction numbers across the country exceeded economists expectations of 210,000 units. The seasonally adjusted annual rate in June was 245,657 units, compared to 196,809 units in May, according to new data from CMHC.
The higher trend can be attributed to an impressive increase in urban starts. In June, they were up by 26 per cent to 234,238 units. Multi-unit projects (condos, apartments and townhouses) saw the most growth. The annualized pace was up by 31 per cent to 185,804 units.
Single-detached urban starts, on the other hand, saw a much smaller increase of just eight per cent to 48,434 units.
The number of new construction projects in Toronto remained relatively flat in June compared to the previous month, CMHC reports. More apartments and single-detached homes were worked on in June compared to row and semi-detached houses.
Although construction on single-detached homes in Toronto used to be on a downward trend, this changed once home sales picked up, CMHC senior analyst Andrew Scott explained to the Toronto Star.
In May, new home sales in the Greater Toronto Area reached their highest levels in 17 years, rising 94 per cent, HuffPost Canada reports. This has boosted the pace of construction on these types of properties in June.
But despite this, CMHC noted that “overall, multi-unit home starts continue to dominate construction so far this year as more homebuyers choose lower-priced condominium apartments and row houses over higher priced single-detached homes.”
It’s not surprising that condos are in high demand. A recent report found that nearly 40 per cent of Torontonians are using condos as investments, likely due to their more reasonable costs. Additionally, another study found that more seniors are moving to big cities, which puts more pressure on the condo market by creating more competition.