Canada Housing Starts Hold steady, Defy Expectations for Partial Reversal of August's Surge

Housing starts held steady at a 217,600 annualized pace in September, stronger than forecast with economists looking for a moderation to 203,000 units. Starts were little changed from August's 217,400 unit pace.

Multi-unit starts rose more than expected and increased at a 5.5% pace to an annualized 122,500 units, building on the 25.2% rise recorded in August. Urban single-starts gave up ground in September and fell 8.1% to an annualized 70,000 units. All provinces but Ontario saw starts hold steady or increase. Ontario starts slipped by 6.6%, a partial reversal of August's surge.

Starts averaged 207,200 in the third quarter, a healthy pace but still about 6% slower than the second-quarter average rate and 14.9% slower than in the third quarter of 2007. The data support our view that activity in Canada's housing market is slowing, although the level of activity remains strong by historical standards.

RBC Financial Group
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The statements and statistics contained herein have been prepared by the Economics Department of RBC Financial Group based on information from sources considered to be reliable. We make no representation or warranty, express or implied, as to its accuracy or completeness. This report is for the information of investors and business persons and does not constitute an offer to sell or a solicitation to buy securities.