Real estate...."Surge in multiple-unit starts propel new home construction"

B.C. housing starts last month more than doubled from a year ago, driven by a surge in multiple-family projects, the Canada Mortgage and Housing Corp. said yesterday.

Multiple-unit starts totalled 2,673 units in September, 68-per-cent higher than the 1,590 units in September 2006, it said.

Single-detached-home starts totalled 955 units, a 15.3-per-cent drop from the year-ago level of 1,127 starts.

"New-home construction in the province is on track to meet CMHC's forecast of 35,525 units in 2007," said Carol Frketich, the CMHC's regional economist for B.C.

For the first nine months of the year, housing starts are running slightly ahead of last year's level, mainly due to a strong third quarter.

Robust economic fundamentals including a strong labour market, as well as growth in population and incomes, continue to underpin the high level of new home construction, CMHC said.

The B.C. results were part of a high-paced construction industry across Canada that saw housing starts soar to a seasonally adjusted annual pace of 278,200 in September.

That was nearly 60,000 more starts than had been expected and nearly 20 per cent higher than in August, the CMHC said.

"All told, despite the tighter credit and lending conditions, the housing sector continues to be a major source of strength to the economic performance in Canada and will certainly add to the upside risks to inflation," said TD Securities economist Millan Mulraine.

The increase in the pace of construction activity was also widespread across the country, she noted.

However, the federal housing agency reiterated that it still expects the pace of construction will moderate over the coming year.

"The rise in September housing starts reflects a strong multiple starts segment," said CMHC chief economist Bob Dugan.

"In particular, the robust results achieved this month can be mostly attributed to increased condominium starts, which reflect strong condo sales over the past 12 to 24 months."

(prepared by Vancouver Province)