Housing starts in Quebec are in free fall in May with a decrease of 62% compared to May 2022, constituting the worst decline in several years.
“This is the worst monthly decline in housing starts in more than 25 years and, unfortunately, it is the rental segment that is the most affected. What’s more, in the cumulative first five months of 2023, all segments combined, the decrease is now 48%, which corresponds to the worst start to the year since 2015″, explained Paul Cardinal, director of the Economic Department of the APCHQ.
In fact, in Quebec, 2,125 dwellings were started in May 2023, a decrease of 62% compared to May 2022. This is the ninth consecutive monthly decrease.
Also in Canada, the housing starts trend has been steadily declining since November 2022. It stood at 230,205 in May, down 4.2% from April when it was 240,318.
The census metropolitan areas (CMAs) of Vancouver, Toronto and Montreal all saw declines in seasonally adjusted and annualized data in May.
The drop was 45% in Vancouver, 28% in Toronto and 35% in Montreal. However, all three CMAs recorded an increase in single-detached home starts, offset by a sharp drop in rental construction.
“The decline in housing starts [au Canada] is attributable to the constraints that limit residential construction, in particular the shortage of labor and the increase in construction and borrowing costs. […] Despite this, housing starts have only declined to the relatively high levels seen before 2020,” said Bob Dugan, chief economist at CMHC.