Canada February Housing Starts Fall 16% to Lowest Since 2009

Canadian builders began work in February on the fewest homes since the recession as cold weather delayed construction and worries over the economy mounted.

Starts fell 16 percent in February to an annualized 156,276 units, Canada Mortgage & Housing Corp. said in a statement. That’s the lowest since July 2009. Multiple-unit starts fell 25 percent. Economists surveyed by Bloomberg forecast a reading of 179,000, the median of 14 estimates.

This February was among the coldest on record in parts of Canada, prompting some builders to delay construction. The decline was largely centered around Ontario and the Atlantic provinces, with Alberta starts little changed in February, suggesting the impact of the oil shock hasn’t yet been fully felt.

“The transitory nature of the weather impact points to homebuilding activity retracing some of this outsized plunge in the coming months,” Laura Cooper, an economist at Royal Bank of Canada, said in a note to investors. “However, the expected rebound will be tempered by new home construction in the Prairies that is expected to come under further pressure reflecting lingering uncertainty in crude oil markets.”

The decline in February was the largest since March last year, when starts fell by 18 percent.

Even if last month proves to be an anomaly, housing starts have been on a downward trend since the end of last year. Starts have averaged 182,137 over the past six months, compared with the six month average of 197,589 through September.

The deterioration in starts is in-line with a slowing home resale market as the country copes with the effects of lower oil prices. The number of homes sold by realtors declined 3.1 percent in January and 5.8 percent in December, making it the largest two-month drop since 2012. Sales in Calgary fell 44 percent over those two months.

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