Senator Daniel Lang (Yukon), on behalf of the Honourable Diane Finley, Minister of Human Resources and Skills Development and Minister Responsible for Canada Mortgage and Housing Corporation (CMHC), along with the Honourable Jim Kenyon, Minister responsible for Yukon Housing Corporation, announced today the construction of new affordable townhouses in the Ingram subdivision of Whitehorse, in addition to renovation funding for existing social housing.

The $5.4 million federal contribution to the projects comes through Canada’s Economic Action Plan, the government’s plan to stimulate the economy and create jobs during the global recession.  Recognizing the distinctive needs of the North, Canada’s Economic Action Plan provides $200 million, over two years, including $50 million for Yukon, to support the renovation and construction of new social housing units. Additionally, CEAP provides $850 million to provinces and territories for the renovation and retrofit of existing social housing. Overall, the Economic Action Plan includes $2 billion for new and existing social housing, plus up to $2 billion in loans to municipalities for housing-related infrastructure.

“Our Government is taking action to help ensure our economic recovery and create the conditions for long-term growth,” said Senator Lang. “Year 2 of Canada’s Economic Action Plan will continue to create jobs and stimulate the economy here in Yukon and in all corners of the country, while also supporting Canadian workers and families.”

“Yukon Housing Corporation is pleased about this new housing project,” said Minister Kenyon. “Six Yukon families will find affordable and comfortable homes here, and the project is providing beneficial SuperGreen training to the construction industry. Investing in our existing social housing stock helps extend the life of the buildings and the retrofits will result in better, more comfortable housing for our clients.”

With some $2.1 million in federal stimulus funding, the new construction project in the Ingram subdivision of Whitehorse will be a 6-unit townhouse complex with two 4-bedroom units and four 3-bedroom housing units for eligible social housing clients. These barrier-free units are being built to meet Yukon Housing Corporation’s Super GreenHome standards. The Kwanlin Dün First Nation Development Corporation 42135 is constructing the project for Yukon Housing Corporation. Completion is anticipated for Fall 2010.

Stimulus funding has also contributed to various retrofits throughout Yukon communities. The federal government is contributing $3.3 million and the Yukon government is contributing $430,000 to these projects. In addition to adding more insulation to some units, Yukon Housing Corporation has also replaced 16 older furnaces with more efficient models, made upgrades to three boiler systems and installed 12 Heat Recovery Ventilation (HRV) systems. Forty-two steel fuel tanks were replaced with dual containment fiberglass tanks. Other retrofits include insulation and lighting upgrades, and attic air sealing. Two Yukon Housing Corporation apartment buildings in Whitehorse will be receiving major exterior retrofits, including superinsulating the building envelope.

Canada’s Economic Action Plan builds on the Government of Canada’s commitment in 2008 of more than $1.9 billion, over five years, to improve and build new affordable housing and help the homeless.

The vacancy rate throughout the St. John’s CMA (census metropolitan area) remained low in 2009. In fact, there was little change in the vacancy rate, which largely reflects the impact of solid economic activity and positive employment growth within the region. Robust residential construction activity, combined with healthy MLS®1 sales and a strong supply of existing homes for sale, translated into continued house price growth, once again making the transition from renting to home ownership challenging for renter households. CMHC’s rental market survey conducted during the first two weeks of October included the enumeration of 3,601 privately initiated apartment units within the St. John’s CMA. The survey identified 31 vacancies within the rental stock, translating into a vacancy rate of 0.9 per cent. This compares to a similar 0.8 per cent vacancy rate recorded in 2008, with the rate below one per cent now for two consecutive years and holding steady at its lowest level since 1980. The vacancy rate was one per cent or lower in every zone within the St. John’s area this year. The biggest change was within Remainder of Metro Area (zone 3), with a rate of 0.3 per cent compared to 0.8 per cent in 2008. St. John’s East (zone 1) posted a vacancy rate of 0.9 per cent versus 1.0 per cent last year. In St. John’s West (zone 2), the vacancy rate was 1.0 per cent compared to 0.7 per cent in 2008. St. John’s City (zones 1-2) posted a vacancy rate of 0.9 per cent versus 0.8 per cent a year earlier. Throughout the St. John’s region, vacancies remained highest in bachelor units at 1.5 per cent and lowest in three bedroom units at 0.4 per cent. The recorded vacancy rate for one and two bedroom apartments was 0.8 per cent for both. Average rents increased across the region for all bedroom types in 2009. The following percentage changes in average rent are based on the fixed sample, which includes structures common to the survey for both years (2008/2009). Bachelor unit average rents increased the most of all bedroom types at 6.2 per cent; one bedroom average rents increased 5.7 per cent; two bedroom unit average rents were up 4.9 per cent; and three bedroom rents increased 5.4 per cent. Overall, the total average rent for all bedroom types combined, advanced 5.5 per cent.

Based on the 2009 survey, bachelor unit average rents were $541; one bedroom average rents were $592; two bedroom units posted average rents of $677; and three bedroom rents came in at $713. Overall, the total average rent for all bedroom types combined was $643. The increase in average rents is a reflection of the upward pressure very low vacancies have exerted on rents since 2008, as well as increasing energy costs and the increased costs associated with operating and maintaining apartment buildings. Once again, current rent levels prevented the construction of multi-unit rental projects in 2009, making the rent/return equation uneconomical for developers and real estate investment trusts (REITs). This has been the situation for more than 20 years within the local rental market. However, local rental market dynamics have been changing, with fewer private owners and increasing corporate ownership. The buoyant St. John’s economy and housing market has seen these corporate entities become increasingly interested in the local rental market. In fact, they have purchased many apartment buildings in recent years. The expectation is that these and other players will engage in new multi-unit apartment building construction activity in the coming years, once average rents reach a point where project development becomes feasible.

The local rental market is driven by a number of factors. These factors have remained fairly constant over time and involve both demand and supply influences. Key factors affecting the demand dynamics for rental accommodations over the short term include economic activity, employment, migration trends and the home ownership rate. The supply side of the local rental market is affected by additions to the rental stock via new construction or conversion of existing space into apartments. Apartment supply can also be reduced by conversion activity when existing rental units get converted to condos or hotels. On rare occasions, demolition of apartments for alternate site use or loss due to fire may also diminish the supply of rental units. While CMHC’s rental market survey historically covered structures containing three or more apartment units only, both demand and supply has always been affected by competition from the secondary rental market (newly surveyed since 2007). This market consists of single-detached units; semi-detached, row and duplex units; and other- primarily accessory suites. Statistics for secondary rented units exclude apartments in purpose built rental structures with three rental units or more, condo apartments, units in institutions, and any dwelling whose type could not be identified in the survey. The estimated number of households in secondary rented units within the St. John’s CMA is quite substantial at 12,896, with an average rent of $653 compared to $618 in 2008. Refer to tables 5.1 and 5.2 for additional details regarding secondary rental market survey results.

In 2001, the vacancy rate in Charlottetown reached a record low of 1.8 per cent, as the construction of rental units was somewhat limited throughout the 1990′s. In response to the low vacancy rate, local developers built higher levels of rental buildings from 2002 to 2006. This strong level of rental construction resulted in a rising vacancy rate from 2003 to 2007. Last fall this trend was reversed, as the vacancy rate declined for the first time in five years due to reduced rental construction in 2007 and 2008. However, the vacancy rate inched back up this year as rental starts are once again on the rise. The increased level of construction pushed the vacancy rate for apartment structures containing three or more units in the Charlottetown CA to 3.4 per cent up from 2.3 per cent last year. The October 2009 survey aggregated the rental information for 3,888 rental units in the Charlottetown area, which was up from the 2008 figure of 3,790 units. Of the surveyed units, 131 were vacant in 2009, compared to 86 vacant units during the same period last year. The 2009 survey revealed that vacancies among two-bedroom units, which make up the majority of the local rental universe, were higher with 78 vacant units, compared to 54 units last year. As a result, the vacancy rate for two-bedroom units rose to 3.1 per cent from 2.2 per cent last year. Among the other unit types the change was more pronounced. One- bedroom units recorded the largest change, as the vacancy rate for these units increased from 2.0 per cent last year to 4.4 per cent in 2009.

Overall, the average rent in Charlottetown was $658 per month in 2009. For the fourth year in a row, CMHC is measuring the change in rents for existing structures (i.e., those common to the current and previous years’ surveys). Focusing on existing structures excludes the impact of new structures added to the rental universe between surveys and provides a better indication of the rent increase for existing structures. For the Charlottetown CA, the average rent for all bedroom types in existing structures increased by 4.8 per cent in October 2009 compared to a year ago. This year’s increase of 4.8 per cent is very close to the 5.0 per cent increase allowed for heated premises by the Island Regulatory and Appeals Commission (IRAC), which manages residential rental increases on the Island. As most of the units in the Charlottetown area include heat in the rent, it is not unexpected that the actual increase mirrored the increase allowed by IRAC. In 2009, there was very little reason to discount rents now that all of the projects built over the past six years have been integrated into the market. Also, owners were looking to increase rents in an effort to make up for the high heating costs experienced in the 2007/2008 winter due to the rapid rise in the price of heating oil. There was a significant difference in the increase in two-bedroom rents recorded in Zone 1 (Downtown) and Zone 2 (Peripheral). In Zone 1, the average two-bedroom rent advanced by 3.9 per cent, while in Zone 2 the increase was more impressive at 5.8 per cent, as measured by the fixed sample.

In addition to the vacancy and rent data that is collected each year as part of the annual Rental Market Survey, landlords and property managers were asked about rental unit availability. A rental unit is considered available if the existing tenant has given, or has received, notice to move, and a new tenant has not signed a lease; or the unit is vacant. Based on the results from the 2009 Rental Market Survey, the availability rate in the Charlottetown CA moved up to 4.9 per cent in 2009 from last year’s level of 4.0 per cent. Within the CA, the availability rate was identical in both Zones 1 and 2 at 4.9 per cent. Among the different bedroom types, one-bedroom units posted the highest availability rate in 2009 at 5.8 per cent. The availability rate for bachelor and two-bedroom units was 4.8 per cent for both.

According to the 2009 Rental Market Survey, the largest apartment buildings in the Charlottetown area command the highest average rents and enjoy the lowest vacancy rates. In the October survey, apartment buildings in the Charlottetown area with between 50 and 99 units posted the lowest vacancy rate at 1.8 per cent, which was well below the overall vacancy rate of 3.4 per cent. The second largest buildings in the area, ranging from 20 to 49 units, also saw lower vacancies with a rate of 3.0 per cent. In addition to having the lowest vacancy rate, the largest buildings also commanded the highest average rents. Buildings with 50 to 99 units had an average rent of $760, while the smallest structures, those with three to five units recorded an average monthly rent of $608. This escalation of rents from smaller to larger buildings is logical, when considering that more amenities tend to be offered to tenants as the building size increases. These features such as elevators, underground parking, security measures and common rooms raise the construction and operating costs for owners, which in turn are passed on to tenants.

According to the latest Rental Market Survey data collected in October by CMHC, the average vacancy rate in privately initiated rental apartments in the Ottawa Census Metropolitan Area (CMA) increased only slightly from last year to 1.5 per cent. Consequently, Ottawa remained one of the tightest rental markets in Ontario.

The low vacancy rate was the result of two contrary influences. On the one hand low borrowing costs coupled with steady employment conditions in the Capital City gave many renters the right incentives to jump into the homeownership market pushing the vacancy upwards. On the other hand minimal rental apartment construction and fewer secondary rental market units kept vacancies low. While both influences roughly balanced each other out, the outflow of households from rental accommodations into homeownership was relatively stronger.

Availability rate is a slightly broader indicator than the vacancy rate, as it captures both the currently vacant rental stock and the stock for which the tenant has given or received notice to vacate. While the vacancy rate remained largely stable at a low of 1.5 per cent, the availability rate jumped from 2.9 per cent in 2008 to 3.5 per cent in 2009.

This suggests that it is possible that some buyers, who are currently renting, have not taken occupancy of their new homes yet, but have already given their landlords their two months notice. The slight jump in availability could also indicate that in Ottawa’s tight rental market, leased units are occupied quite rapidly after they become vacant, maintaining a stable vacancy rate.

Employment performance among first time buyers’ ages 25 to 44 years old has been very resilient, remaining on par with levels this time last year. Labour market recovery for this age cohort has been remarkable and has enabled some potential first time buyers to take full advantage of declining borrowing costs. An economic environment of low interest rates unleashed the pent-up demand accumulated early in 2009. As a result, the movement out of rental and into homeownership in this age group has been significant, pushing vacancy rates upwards.

Another factor supporting the increase in vacancy rate is the weak employment performance among young renters. The age cohort between ages 18 to 24 has been the weakest when compared to other age groups. Total year-to-date full time employment is down 8.7 per cent from last year. Rising unemployment within this age group has obliged some young adults to remain in their parental home, dampening the rate of household formation.

The rental market eased in the Trois- Rivières CMA this year. According to the results of the Rental Market Survey conducted in October by Canada Mortgage and Housing Corporation (CMHC), the proportion of unoccupied units reached 2.7 per cent, compared to 1.7 per cent in the fall of 2008. In so doing, the vacancy rate surpassed the 2-per-cent mark for the first time since 2002. This increase, the third in as many years and the largest, reflects a certain easing of the market. In fact, since 2003, rental market conditions had been particularly tight in the Trois- Rivières area, with the proportion of vacant units hovering around 1.5 per cent. It should be noted however average for the last 20 years (5 per cent). In the fall of 2009, 435 units were vacant (compared to 273 in October 2008) out of a total stock of 16,276 apartments contained in privately initiated buildings with three or more housing units. Many new units and a

The low vacancy rates registered in the area for the past several years greatly stimulated rental housing construction. Until now, this additional supply had been just counterbalanced by the strong demand, which was attributable to the dynamic migration. In 2009, however, rental housing construction maintained the same pace, but demand declined slightly. The weaker job market in the Trois- Rivières area therefore removed the upward pressure on rental housing demand. For one thing, the economic uncertainty that has been looming over Trois-Rivières for several quarters has forced some workers to leave this area for another. At the same time, this economic environment has made the area less attractive in the eyes of job seekers from other areas. Consequently, the supply of housing units exceeded demand, which pushed up the vacancy rate. In addition, financing conditions, which have rarely been so favourable, prompted a few renter households to access homeownership. Given the low mortgage rates, some may even have moved up their decision to buy, which, in turn, vacated a few rental dwellings.

In October 2009, stable rental market conditions were noted in four of the six CMAs in the province, as the Québec, Gatineau, Montréal and Saguenay areas did not register any significant change in their vacancy rates compared to October 2008. This past October, the Sherbrooke CMA had the highest vacancy rate in the province (3.9 per cent), followed by Trois-Rivières (2.7 per cent), Montréal (2.5 per cent), Gatineau (2.2 per cent), Saguenay (1.5 per cent) and Québec (0.6 per cent).

While the vacancy rates went up in all sectors of the CMA, Downtown and Bécancour stood out. In fact, these two zones, which had the highest vacancy rates in the CMA, were responsible for the increase in the overall vacancy rate. In October 2009, the proportions of unoccupied units reached 5.0 per cent in the Downtown zone and 9.1 per cent in Bécancour. When the market eases, the Downtown zone is quite often the first to see its vacancy rate rise. This is due to the fact that its housing stock is older. It has been noted that, as units are vacated in other sectors of the CMA, tenants leave their Downtown dwellings for these units, which are often newer and more modern. In Bécancour, the market seems to have been experiencing difficulties since the closing of a plant in this zone. However, the upcoming commissioning of the Twin Rivers Technologies oilseed crushing plant and the construction of a complex for the production of polycrystalline silicon for the solar panel industry in the industrial and harbour park should give a boost to this zone and put upward pressure on housing demand there.

Elsewhere in the CMA, the vacancy rates remained relatively low. The proportions of unoccupied units reached 2.5 per cent in Cap-de-la- Madeleine and Saint-Louis-de-France and 2.1 per cent in the Université du Québec à Trois-Rivières sector, where demand for rental housing stays relatively constant in any given year, thanks to the presence of the university and the Cegep. Lastly, the vacancy rates attained 2.0 per cent in the North sector and 1.6 per cent in Trois-Rivières-Ouest.

Vacancy rate keeps rising According to the results of the latest CMHC Rental Market Survey conducted in October 2009, the rental apartment vacancy rate1 increased again in the Sherbrooke CMA. After climbing by 0.4 of a percentage point in 2008 to 2.8 per cent, the vacancy rate continued to rise in 2009, reaching 3.9 per cent. As shown in Figure 1, the rental market has now been easing more significantly for the past three years in the Sherbrooke area. However, the proportion of unoccupied units still remained far from the levels observed in the late 1990s, when more than 7 per cent of rental apartments were vacant.

In the other CMAs across the province, the Québec area still had the tightest rental market, with fewer than 1 per cent of apartments vacant. As for the Saguenay, Montréal and Gatineau areas, their proportions of unoccupied units remained relatively stable between October 2008 and October 2009, edging down from 1.6 per cent to 1.5 per cent in Saguenay and rising slightly from 2.4 per cent to 2.5 per cent in Montréal and from 1.9 per cent to 2.2 per cent in Gatineau. In the Trois-Rivières CMA, however, the vacancy rate was up, reaching 2.7 per cent (+1 percentage point). Among all of Quebec’s urban centres with 100,000 or inhabitants, Sherbrooke had the highest percentage of vacant rental housing units in 2009, for a second straight year.

Supply increases while demand slowsThe vacancy rate hike in the Sherbrooke CMA in 2009 resulted from a moderating demand and a rising supply.

On the demand side, migrants who come to an area, whether from other areas of Quebec or elsewhere, are definitely one of the main factors. In fact, most newcomers to an area choose to rent when they arrive. The relationship between migration and the vacancy rate is illustrated in Figure 3, with high net migration often being associated with a tighter rental market and the opposite also being observed.

Preliminary data2 show that no substantial immigration gains should be registered in the Sherbrooke CMA since the last survey. Stagnant immigration is no doubt one of the factors that contributed to moderating rental housing demand in the Sherbrooke area this year.

As well, the Sherbrooke CMA has recorded negative net interregional migration3 of about 100 people among the group aged from 15 to 34 years4, for the past two years. In other words, more young people left the capital of the Eastern Townships than settled there. This decrease therefore moderated demand for rental housing units, as the young population is an important client group on the rental market. In fact, according to data from the latest census (2006), most Sherbrooke area households whose primary maintainer is aged from 15 to 34 years are renters.

In addition to migration, several other factors contributed to slowing rental housing demand in the Sherbrooke CMA in 2009. One such factor was that the labour market was less favourable for young people (labour force aged from 15 to 24 years) between the October 2008 and October 2009 surveys. Compared to last year, the average employment level fell by 14 per cent among young people aged from 15 to 24 years, with this decrease mainly affecting full-time jobs (-24 per cent). In these conditions, many young people may have been deterred from leaving the family home, or encouraged to share accommodations, which also slowed demand on the rental market.
Changes in the age structure of a population (in this case, the aging of the population) may also have an effect on the proportion of unoccupied rental housing units in an area. According to our latest demographic projections, the growth in the number of young households (aged from 15 to 34 years) in the Sherbrooke area will be relatively weak, if not stagnant, between 2008 and 2009, which will limit the potential renter client pool. Negative growth is even forecast for the next few years, which will further curb demand on this market.

Another major reason for the vacancy rate increase is that financing conditions have been favourable to home buying, which means that a number of renter households possibly became homeowners. In fact, the strong sales of existing and new homes registered in the CMA in recent years seem to support this point. The same scenario was likely repeated in 2009, which again drove up the percentage of vacant units in the Sherbrooke area.

With such demand conditions and a rental housing supply that increased by 2.5 per cent between our last two surveys (from 30,842 units in 2008 to 31,621 in 2009), it was therefore not surprising to see a hike in the vacancy rate in 2009 in the Sherbrooke CMA.

Lastly, it should be mentioned that, even with the low vacancy rates observed in recent years, the growth in the supply on the rental market has been rather limited. It should not be forgotten that, in the late 1980s, rental housing construction had been very strong in the CMA, such that the vacancy rates had hovered around 10 per cent in the years that followed. Some builders may have then decided to focus their activities on other market segments. Now, even with the low vacancy rates registered in recent years, rental housing construction has never returned to its previous pace. This is generally the case, as a lag is often observed between changes in the vacancy rate on a market and the ensuing adjustment in the level of rental housing starts.

According to the results of the Rental Market Survey conducted by CMHC in October, the market remained tight in the Québec CMA, as the vacancy rate stayed at 0.6 per cent. As well, the availability rate, which measures the percentage of units up for rent, was also low (1 per cent). This indicator revealed that a small proportion of tenants intend to put an end to their leases. The percentages of vacant units and available units on the market were therefore low. Demand for apartments has been strong, and supply has increased only slightly in recent years. The economic conditions prevailing in the area have contributed to maintaining demand for rental housing, with the low unemployment rate and solid job market having stimulated the formation of young households and the migration of workers to the CMA. In addition, youth employment rose this year. It should be noted that young households with a primary maintainer aged under 25 years are most often (9 times out of 10) renters.

The Québec CMA has the tightest rental market in the province. And, the Québec area, along with the Regina CMA, also had the tightest rental market conditions in the country. Across the province of Quebec, conditions remained stable in the Gatineau, Montréal and Saguenay areas, as well, while they eased in Sherbrooke and Trois-Rivières. Vigorous demand Since the beginning of the decade, the rental market has been tight in the CMA. It should be pointed out that employment has grown and that the unemployment rate reached an all-time low in 2008 (4.5 per cent). During the first half of 2009, the labour market resisted the global recessionary climate, as employment increased in the first two quarters. However, a decline was noted in the third quarter. In the end, the number of jobs should remain stable in 2009 and rise slightly in 2010 (+0.5 per cent). This contrasts with the conditions observed in the other urban centres across the province, where decreases in employment have been noted since the beginning of the year.

The economic conditions therefore remained favourable in the area, as net migration rose to 4,350 people in 2007/2008, for a gain of 6 per cent over the year before. According to the available data, net migration will be high in the area for the current decade, reaching a total of about 40,000 people, compared to just 20,000 during the 1990s. The large number of new residents is significantly fuelling demand for rental housing. In fact, interregional migration is considerable and mainly composed of young people aged from 15 to 24 years (66 per cent). The international migration component has also increased in recent years, but the area is still losing some residents to other Canadian provinces.

Construction stimulated by market conditions In 2007 and 2008, traditional rental housing construction was less significant than in previous years. This situation, combined with a steady demand, contributed to maintaining the tight conditions observed on the market in the area. Between 2008 and 2009, 459 traditional rental housing were completed, which reflects a small increase in supply, considering the size of the Québec area market and the strong demand. This year, however, construction was more vigorous. In all, 924 traditional apartments were started from January to October 2009, compared to 423 during the same period in 2008.

Market very tight for larger units The larger the unit size, the tighter the market conditions as, in October, the vacancy rate was 0.1 per cent for three-bedroom apartments, compared to 1.6 per cent for bachelor units. The availability rate was also lower for larger apartments (0.5 per cent). As well, the supply of such units was more limited, accounting for an estimated 14 per cent of the universe1. with 10,400 three-bedroom apartments out of a total of 71,900 units. Two-bedroom apartments, for their part, made up 51 per cent of the survey universe.

Conditions tight in all market zones The conditions prevailing in the nine market zones in the CMA reflected a strong demand in all sectors. However, the rental market in the Haute-Ville zone has eased slightly since last year, as the vacancy rate there rose from 0.7 per cent to 1.4 per cent. And, the availability rate in this zone reached 2.2 per cent this pas October–the highest in the area. The estimated change in the average rent could explain this easing of the market in the Haute-Ville zone, as rents there rose by 4.5 per cent over 2008, for the strongest increase among all market zones in the Quebec area. In addition, this zone has the highest rents, with the average rent for two- bedroom apartments having reached $881 per month this past October, or 30 per cent more than the average for the CMA ($676 per month).

It should be noted that the western part of the South Shore (Charny, Saint-Romuald, Saint-Jean- Chrysostome) had a vacancy rate of 0 per cent this past October, compared to 0.2 per cent the year before, while the eastern part of the South Shore (Lévis, Pintendre) saw its market conditions ease this year (with a vacancy rate of 0.9 per cent, up from 0.4 per cent).

The seasonally adjusted annual rate of housing starts reached 158,500 units in November. This is an increase from 157,400 units started in October, according to Canada Mortgage and Housing Corporation (CMHC).

“The improvement in housing starts continued in November,” said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “Despite a small decline in November’s multiple home construction, overall starts numbers were up due to a solid increase in singles starts.” The November total is the highest of the year.

The seasonally adjusted annual rate of urban starts increased by 0.7 per cent to 141,100 units in November. Urban multiple starts decreased slightly from 72,500 units in October to 71,300 units in November. Single urban starts increased by 3.4 per cent to 69,800 units in November.

November’s seasonally adjusted annual rate of urban starts increased by 10 per cent in Quebec, by 8.2 per cent in the Prairies and by 6.2 per cent in British Columbia. The rate of urban starts decreased by 8.3 per cent in Ontario and by 9.8 per cent in Atlantic Canada.

Rural starts were estimated at a seasonally adjusted annual rate of 17,400 units in November.

As Canada’s national housing agency, CMHC draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making vital decisions.

With some 1,850 new homes expected to be started in both 2009 and 2010, new home construction is expected to remain relatively stable. This is mostly due to a weak rebound of single-detached home construction,which is expected to increase by only 50 units from the 2009 level.

The weak rebound in single-detached home construction is mostly due to competition from the resale market, especially from the nearly new category (homes of 1-5 year vintage). Strong growth in new single-detached home construction before 2006 created a large stock, and some of them are being offered for sale in the resale market. These homes are very popular among doctors, nurses or other health care or natural sciences related professionals. During the past few years, they tended to purchase new from builders because the resale market was tight. However, with a larger offering of nearly new homes on the market, they tend to find what they want in the resale market. With listings of resale homes expected to remain high, these professionals will tend to purchase from resale than directly from builders.

There are reports that some builders may be building up inventories in order to better compete with the resale market, by being able to have homes ready for customers to move into as soon as the transaction closes. However, at the end of September, the level of completed and unabsorbed homes dropped to 99 units, down from nearly 200 units earlier this year.

Apartment construction will be relatively strong in 2009 and 2010. Overall apartment starts will reach 850 units in 2009, and 800 units in 2010.Many of them will continue to be in the high-end rental category. Empty nesters and retirees who like the convenience of an apartment lifestyle are the key customer group for these apartments.

Condominium apartments are also becoming a factor in the London housing market. The popularity of high-end rental apartments among empty nesters and retirees has resulted in some showing interest in ownership. Developers are beginning to build high rise condominiums to satisfy this demand.