THUNDER BAY – Housing starts in Thunder Bay, Census Metropolitan Area (CMA) were trending at 106 units in May, almost the same as 107 units in April according to Canada Mortgage and Housing Corporation (CMHC). The trend is a six month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.
“The downward trend in housing starts in Thunder Bay, in evidence since January, continued in May. Abundant listings at the high end of the resale market are restraining new housing demand. Households considering building a new home may find something that meets their needs among these higher-priced listings in the resale market that are close substitutes to new houses. Weakening employment levels may also be dampening demand for new singles, as homeowners looking to sell a resale home before buying new may face a greater challenge finding a buyer,” observed Warren Philp, CMHC Market Analyst.
The Thunder Bay Trend bucks the Ontario Trend
Housing starts in the Ontario region were trending at 60.026 units in May, up from 55,601 units in April, according to Canada Mortgage and Housing Corporation (CMHC). The trend is a six month moving average of the monthly seasonally adjusted annual rates (SAAR)(1) of housing starts.
“The trend in residential construction activity rose for a third consecutive month in May reaching its highest level since early 2014. The increase in the Ontario construction trend was broad based and stretched across a number of housing segments and markets. Low rental vacancy rates, strong resale markets and more resources released to commence construction on a backlog of sold apartment units drove starts activity in recent months,” said Ted Tsiakopoulos, CMHC’s Ontario Regional Economist.
CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of the state of the housing market. In some situations, analysing only SAAR data can be misleading in some markets, as they are largely driven by the multiples segment of the markets which can be quite variable from one month to the next.
The standalone monthly SAAR was 167 units in May up from 107 units in April. This jump in the monthly SAAR because of the multiple unit activity in the month of May was stronger than usual.