CMHC says new home construction declined 17% in October

The Canada Mortgage and Housing Corp. said Tuesday that the annual pace of housing construction, also known as new home construction, fell 17 per cent in October compared with September.

The National Housing Agency says the seasonally adjusted annual rate of housing starts was 232,765 units in October, up from 279,174 in September.

CMHC deputy chief economist Tania Bourassa-Ochoa says the decline is due to a decline in the number of starts in Ontario and British Columbia in October.

However, he said better starts in markets like Montreal, Calgary and Edmonton helped keep the national year-to-date total higher than the same period last year.

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Real housing starts in centers with a population of 10,000 or more totaled 19,174 units in October, up from 19,763 in October 2024, while year-to-date housing starts for centers with a population of 10,000 or more totaled 197,207 units, up from 188,660 in the same period in 2024.

The six-month moving average of the seasonally adjusted annual rate of total housing starts was 268,907 in October, up from 277,081 in September.

“While these results generally reflect investment decisions made months or years ago, they also highlight persistent and significant regional contrasts in housing construction trends across the country,” Bourassa-Ochoa said.

Rishi Sondhi, an economist at TD Economics, said October data showed builders are launching new units “at a fairly healthy clip, supported by the purpose-built rental market.”

“Notably, home construction in the rest of Canada is much stronger than in Ontario, with Ontario being hit hard by layoffs in condo construction,” he wrote in a note.

Sondhi also said that the trends shown in the October data suggest that there will be a further decline in new construction jobs in the near term.

“This is consistent with our view that home construction is likely to cool next year, as modest population growth weighs on rents, and weaker pre-sales activity restrictions trigger the ownership market,” they wrote.