Housing starts in the capital dropped in October, the Canada Mortgage and Housing Corporation said Monday.
Starts in the capital trended at 5,398 in October, compared with 5,547 in September and high inventory levels is a factor, the CMHC said.
“The inventory of completed and unsold row and apartment units has been increasing over the past year, and reached 729 units in September,” CMHC Ottawa market analyst Anne-Marie Shaker said in a statement. “Builders may be looking to unwind these inventories before starting new projects.”
Ms. Shaker added that overall employment and earnings are lower so far this year compared to 2014, and that is affecting multiple starts activity.
The trend is a six-month moving average of the monthly seasonally-adjusted annual rates of housing starts (SAAR).
Ottawa’s monthly SAAR was 4,836, also down from September, when it came in at 5,334.
The pace of new residential construction also slowed down across the country, but the decline in housing starts wasn't enough to change the upward trend over the past six months.
The CMHC said last month's seasonally adjusted rate of housing starts was 198,065 units, down from 231,304 in September – primarily because of fewer of multiple-unit project starts in urban areas.
The urban multi-unit starts accounted for 122,187 units nationally in October, down 22 per cent from the previous month.
CMHC says the decline in urban starts was seen in most regions of Canada, with British Columbia being the exception.
The overall number of single-detached starts was up from September, but accounted for only 59,255 of the total.
CMHC says the six-month trend in October continued to rise, going to 206,089 from 202,793 in September.
-with files from the Canadian Press