The pace of homebuilding in Canada continues to slow alongside the broader economy, according to the national housing agency.
Canada Mortgage and Housing Corp. (CMHC) reports that the seasonally adjusted annual pace of housing starts declined 15% in January from a year earlier.
Worse, CMHC says there appears to be no end in sight for the housing slowdown. The agency’s six-month moving average for annual starts has declined 3.5%.
“We expect new construction to continue trending lower going forward as trade and geopolitical uncertainty, high construction costs, weaker demand, and rising inventories continue to constrain developer activity,” said CMHC in a news release.
The drop off in new home construction comes amid lower immigration numbers and economic uncertainty over changing U.S. trade policies.
Housing starts were up 1% year-over-year in Canadian cities with populations above 10,000. About 16,088 housing starts in those centres were recorded in January.
But nationally, the Canadian housing and construction sectors are in a slump.
Prime Minister Mark Carney campaigned on a promise to double housing construction to 500,000 homes a year over the next decade.
Last September, the federal government launched a new agency called Build Canada Homes with a mandate to accelerate new home construction.
The Build Canada Homes agency has been given $13 billion to help with the financing of new home construction, provide land to developers, and help builders get projects started.
Canada’s new home construction peaked in the 1970s at about 260,000 dwellings per year.
