Ottawa-Gatineau homebuilders slowed their pace of new projects in August while a lack of inventory in the National Capital Region continues to drive housing prices higher.
The Canadian Mortgage and Housing Corp. said Tuesday that Ottawa-Gatineau saw just 700 housing starts in August, down 39 per cent from the same month last year. Fewer than 100 of those new builds were in Gatineau, representing a decline of more than 50 per cent year-over-year.
Work started on nearly 400 new condominium, townhome and other multi-tenant housing units in the National Capital Region last month, down 40 per cent from August 2018. Single-detached housing starts weren’t much better, with just slightly more than 300 new units launched, a drop of 20 per cent year-over-year.
While both the Ontario and Quebec sides of the river saw declines this past month, CMHC notes that Gatineau is performing well thus far in 2019: housing starts in the city are up 58 per cent year-to-date.
Last month’s lull in housing starts might disappoint observers in the Ottawa real estate market.
Ottawa Real Estate Board president Dwight Delahunt said last week the capital continues to face supply shortages, which is putting upward pressure on housing prices. The average sale price of a residential property was $484,921 in August, a jump of 11.8 per cent year-over-year, while the average condo price was $308,781, an increase of 11.5 per cent from last year.
Nationally, CMHC says the pace of new housing starts in August climbed 1.9 per cent compared with July.
The housing agency says the seasonally adjusted annual rate of housing starts rose to 226,639 units in August, up from 222,467 units in July.
Economists on average had expected an annual pace of 215,000, according to financial markets data firm Refinitiv.
The six-month moving average of the monthly seasonally adjusted annual rate of housing starts in Canada increased to 218,998 in August compared with 208,931 in July.
The increase in the result for August came as the pace of urban starts increased two per cent in August to 213,663 units. Multiple-unit urban starts fell 1.4 per cent to 160,388 units in August while single-detached urban starts increased by 13.6 per cent to 53,275.
Rural starts were estimated at a seasonally adjusted annual rate of 12,976 units.
– With files from Canadian Press