The pace of new home construction picked up unexpectedly in February driven by strength in the condo market in major cities, Canada Mortgage and Housing Corp. said Thursday.
Meanwhile, Statistics Canada reported that building permits rose beyond expectations in January — particularly in the condo market — signalling continued strength in the multi-family dwelling category.
CMHC said the seasonally adjusted annual rate of housing starts increased to 229,737 units in February, up from 215,260 in January,
Economists had expected the rate to come in at 216,600, according to Thomson Reuters. Housing starts are considered an indicator of how the economy is performing.
TD Bank economist Rishi Sondhi said homebuilding continues to defy expectations.
“Starts are being boosted by a relatively firm economic backdrop, healthy population growth and past gains in pre-construction sales in Toronto,” Sondhi wrote in a report.
“However, February’s increase was driven by the volatile multi-unit sector, leaving some scope for reversal in March.”