Canadian housing starts rise in November

Housing starts rose for the first time in four months in November, suggesting that Canada's housing market has stabilized.

Canada Mortgage and Housing Corporation said housing starts increased by almost 20,000units during the month to a seasonally adjusted annual rate of 187,200, up from 167,800 units in October.

Analysts were expecting about 170,000 units.

The surge in November starts, helped largely by construction in Ontario, came after four months of disappointing numbers.

"This clearly suggests that Canada's housing market has stabilized after slowing through the summer," said Sal Guatieri, senior economist at BMO Capital Markets. "It looks like that correction in the housing market that occurred through the summer has stopped."

Guatieri credited some of the growth to the recent declines in longer-term interest rates.

The increase in the level of multiple starts recorded in Ontario compared withOctober was attributed to the start of a number of major apartment projects mainly in the Toronto area.

CMHC cautioned, however, thatin 2011, "housing starts will gradually become more closely aligned to demographic demand, which is currently estimated at about 175,000 units per year."

The seasonally adjusted annual rate of urban starts increased by 14.6 per cent to 163,100 units in November.

Urban multiple starts rose by 20.9 per cent in November to 101,800 units, while single urban starts moved up by 5.5 per cent to 61,300 units.

Multiple unit starts rose 29,900 units from October to November in Ontario,remained relatively stable in the Prairies, and decreased in other regions.

"The increase in housing starts in Ontario was more than enough to offset declines in all other regions of the country," Bob Dugan, chief economist at CMHC's Market Analysis Centre, said in a release.

The month's seasonally adjusted annual rate of urban starts increased by 82.8 per cent in Ontario. Elsewhere, urban starts decreased by 24 per cent in Atlantic Canada, by 21.3 per cent in British Columbia, by 15.2 per cent in Qubec and by 1.5 per cent in the Prairie Region.

Rural starts were estimated at a seasonally adjusted annual rate of 24,100 units in November.