It was noted by the Globe and Mail that September saw a 1.6% decrease in housing starts from August.
Why is it that the housing market is starting to slip?
“Canada Mortgage and Housing Corp. blames the decline on a decrease in urban single starts in Atlantic Canada and Ontario.” If we have a look at the market on a broader spectrum, this statement makes perfect sense. The economy is still working itself out of a recession. As a result, many people are doing everything they can to save money instead of spending it. With this in mind, students who have finished school are moving back into their parents’ house to save money, more people are eating in instead of dining out, and when it comes to homes people are buying them in suburbs instead of highly urbanized areas as the cost of living is less expensive.
As a result, I completely agree with the statement made by the Canada Mortgage and Housing Corp. There is most certainly a decrease in urban single starts and for good reason. It will likely be a couple of years still until we see this number increase at a significant rate. Although, this is not to say that nobody is investing in housing starts. Those that are either have very little debt, have opted for a second mortgage, or realize that the market will turn around in which case a housing start is a wise investment at this time.
