Apartment construction drops in July, pushing down Ottawa housing starts
Residential construction activity in Ottawa plunged 49.5 per cent in July as starts for all housing types fell sharply from the same month a year earlier, according to the latest data from Canada Mortgage and Housing Corp.
Published on August 9, 2011 Krystle Chow Ottawa Business Journal
A total of 385 homes were started last month, down from the 763 units in July 2010, with double-digit declines in both the single-detached and multi-family segments.
"A moderate resale housing market, the effects of tighter mortgage rules and emerging global uncertainties have combined to temper demand for new homes in Ottawa," said CMHC senior market analyst Sandra Perez Torres in a statement.
Apartment construction, which is generally more volatile than that of other housing types, had the most significant year-over-year decrease of 76.4 per cent, with the total number of apartments started slipping to just 70 in July.
The drop - along with a 42.3-per-cent decrease in row housing starts, to 120 units - contributed to an overall 58.1-per-cent decline in the multi-family segment, which recorded a total of 230 starts.
Still, Ms. Perez Torres said the apartment starts decrease "remains in line with underlying demographic fundamentals," and that the figure indicates a still-solid trend.
Single-family starts, meanwhile, fell 27.6 per cent to 155 units, the CMHC report showed.
CMHC noted that almost 30 per cent of total housing construction took place in Ottawa's core in July, driven largely by the 70 apartment units, which represented a single social housing complex project in the downtown area. Despite the activity, the region comprised of the old city of Ottawa, Rockcliffe Park and Vanier had one of the largest percentage declines among the nine surveyed areas, at 60.5 per cent, with starts falling to 111 units.
Gloucester also posted a large 78.9-per-cent decrease, to just 20 units, although CMHC noted the east-end section was the only area to see significant row housing construction growth.
Only Cumberland and Rideau Township saw increases in housing construction in July, and both hikes were relatively small, the report showed. Cumberland had a 12.24-per-cent rise to 55 units, while the Rideau Township saw starts rise to five from two.
On a year-to-date basis, Ottawa starts are down 17.8 per cent, with residential construction activity for most regions trailing behind last year's pace. The sole exception, CMHC noted, is downtown Ottawa, "due to a warm early start of the year."