B.C. housing starts dropped dramatically in May as construction of townhomes and condos dipped throughout the normally robust province, according to data released Monday (June 8) from Canada Mortgage and Housing Corporation (CMHC).
Construction began on 25,000 units across B.C. last month, falling 32% compared with April when 37,000 units got their starts.
But the rest of Canada “showed surprising strength” in May, according to TD Economics senior economist Randall Bartlett.
Canadian housing starts rose to 202,000 units, up 10% from the previous month when construction began on 183,000 units across the country.
In a note to investors, Bartlett said the Bank of Canada’s January interest rate cut is proving its continued staying power and boosting interest in construction, even in provinces hit hard by the big decline in oil prices. Housing starts in Saskatchewan picked up 42.6% and Alberta saw a boost of 3.8%.
While the CMHC’s data didn’t appear nearly so rosy in B.C., BMO senior economist Robert Kavcic said in an investors note that the national data shows the Canadian economy is rebounding following the recent plunge in oil prices.
"After a blowout employment report on Friday, this is a second indication that the Canadian economy was thawing in May," he wrote.
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