DOUGLAS – Vancouver Island’s housing construction market is still slow, operating at levels not seen for more than 20 years, according to the Canada Mortgage and Housing Corp.’s latest stats on housing starts.
“They started to fall off last year and they haven’t recovered,” said Travis Archbald, senior market analyst at CMHC in Vancouver.
There were 229 starts on the Island last month, eight more than July. In August, 2008 there were 345 starts.
Most of the decline is due to much lower condo construction.
Year-to-date, there were 1,312 housing starts of all kinds on Vancouver Island, while the same eight months last year had 2,934 starts.
The single-family side of the housing industry is in better shape, but compared to the 15-year average of 725 single-family starts for the eight-month period, January to August this year recorded only 326 single-family starts.
The CMHC tracks new construction, but there are signs the single-family side is moving. “We’re starting to see the [single-family] resale market pick up in the last couple of months,” said Archibald.
The multiple-family numbers are a lot lower–just 162 starts so far in 2009, compared to the average of 975 in each of the last 15 years.
One hotspot on the Island is Nanaimo, where housing starts so far this year have been close to the first eight months of 2008–558 starts versus 630 last year.
The seasonally-adjusted rates for B.C. and Canada–a different calculation that takes into account that summer is the busiest construction time–showed housing starts in August on course to hit 17,000 across the province this year, 56 per cent higher than July.
For all of Canada, the seasonally-adjusted rate hit 150,400 starts, up 12 per cent on the month before.
Asked for his predictions on what’s ahead, Archibald said: “It’s tough. In terms of new construction, it’s got to pick up from where it was.”
Summer is usually the busy time for new building projects, but 2009 was slow, and it probably won’t improve much over the usually slower winter months. By next spring there should be more activity. One drawback is that it’s still harder for condo builders to get financing. For the single-family housing market, interest rates are at historic lows.