Construction jump in Atlantic region bucks national trendBy BRUCE ERSKINE Business ReporterTue. Mar 10 - 6:13 AM
A new 90-unit apartment development helped drive up residential construction starts in Halifax in February, according to Canada Mortgage and Housing Corp.
"One of the city’s anticipated apartment projects began construction last month and this bolstered the overall numbers for February," said Matthew Gilmore, senior market analyst with CMHC’s Atlantic Business Centre.
CMHC data released Monday showed there were 128 new housing starts in Halifax last month, compared to 86 starts in February 2008.
Mr. Gilmore said the apartment development increased multiple-unit starts in Halifax to 106 for the month and helped compensate for weak single-detached starts, which dropped to 22 in February from 73 in the same period last year.
"While demand for singles is expected to remain weak throughout the year, alternative styles, such as row housing, are already showing some strength," he said.
Mr. Gilmore said in an interview that semi-detached dwellings provide good value for money.
In the Atlantic region, 262 new residential units were started in February 2009, up slightly from the 255 units started during the same period in 2008.
Pascal Gauthier, an economist with the TD Bank Financial Group, attributed the uptick, relative to a downturn in the rest of the country, to the region’s "more balanced market."
Mr. Gilmore agreed, noting that Atlantic Canada doesn’t experience the economic peaks and valleys now being experienced in places like Western Canada.
"It’s more of a slow and steady growth."
Nationally, CMHC reported that urban housing starts in February declined dramatically, by 59 per cent, to 5,594 from last year’s tally of 13,531 for the month.
Single-detached starts decreased 53 per cent to 2,019 units in February, while multiple-unit starts were down 61 per cent from 9,192 units in 2008 to 3,575 units this year.
CMHC said new residential construction in Canada is slowing to more sustainable levels and forecasts there will be 160,250 unit starts in 2009, down from the exceptionally strong 200,000 starts per year that Canada averaged over the past seven years.
In Halifax, CMHC projects that total residential housing starts in 2009 will be in the 2,000-unit range, down from 2,100 in 2008, while total provincial starts in 2009 are projected at 3,675 units, down from 4,000 last year.
Single-unit starts in Halifax are projected to drop to 1,000 in 2009 from 1,200 last year, while multiple-unit starts are expected to increase to 1,000 from 900 in 2008.
Single-unit starts across Nova Scotia are projected to drop to 2,350 in 2009 from 2,650 last year, he said, while provincial multiple-unit starts this year are projected to drop slightly to 1,325 from 1,350 in 2008.
"Nova Scotia is not seeing significant declines," said Mr. Gilmore.
He said Halifax’s economy, while feeling the effects of recession, remains relatively strong in terms of employment and wages.
Paul Pettipas, CEO of the Nova Scotia Home Builders’ Association, wasn’t surprised by the February numbers and was positive about the prospects for 2009, despite the many doom-and-gloom scenarios in circulation.
"We had a tremendous home show (on the weekend) and people are ready to buy," he said, agreeing that Halifax’s largely public sector economy remains strong. "The labour market is still tight."
CMHC is a federal agency established in 1946 that provides mortgage loan insurance and mortgage-backed securities. It also conducts housing research and develops housing policy and programs.
