Housing market looking positive despite high interest rates

New data from the Canada Mortgage and Housing Corporation has shown an uptrend for the housing market with an increase of 2.8% to 242,525 in June.

The standalone monthly seasonally adjusted annual rate (SAAR) housing starts for all areas in Canada also increased by 7.4%, which is above the five-year average. On the other hand, the total SAAR housing starts for all areas in Canada was down 10% in July compared to June, which was the strongest month this year so far.

"Despite a decrease in the SAAR of housing starts relative to last month, July saw a healthy number of actual housings starts from a historical perspective,” said Bob Dugan, chief economist at CMHC. “Market intelligence suggests multi-unit projects started in June and July were likely financed a few months prior, so, the effect of the most recent interest rate hikes on housing starts remains to be seen.”

The monthly SAAR of total urban starts was down 11% as well in July, while the rural starts monthly SAAR estimate was 20,019.

The Vancouver and Toronto CMAs also decreased in total SAAR housing starts in July, 23% and 29%, respectively. Meanwhile, the Montreal, Calgary, and Edmonton CMAs were up in terms of the total SAAR housing starts, recording increases of 12%, 33%, and 67%, respectively.