A drought in apartment construction this year is continuing to keep a lid on housing starts in the London area.
The Canada Mortgage and Housing Corp. (CMHC) said there were 145 housing starts in March: 122 single-detached and 23 semi and rowhouse starts.
There were no apartment/condo starts in March and only four units have been built since the beginning of the year.
CMHC analyst Amran Wali said in contrast the single-detached market has held up well with 292 starts this year, almost on par with 295 in the first quarter of 2017.
Wali said the single starts are well above the 10-year average, fuelled by a tight resale market. The inventory of resale homes is at a 10-year low and buyers are turning to new homes as an alternative.
But the lack of apartment construction has led to a large decline in overall housing starts in the 2018.
CMHC said there were 343 housing starts in the first quarter compared to 979 in same period 0f 2017.
Some apartment projects are likely to proceed later last year. Old Oak Properties has taken out a building permit for an 11-storey apartment building on Pomeroy Lane.
Apartment condo projects at 131 King St. and 515 Richmond St. could also begin later this year, as well as an affordable housing building 1039-1047 Dundas St.
Across Canada, the estimated annualized number of housing starts dipped to 225,200 units in March from 231,000 in February. But the average over the past 12 months of 211,000 is close to the strongest pace since 2008.
“This reinforces the key message that residential construction activity remains relentlessly strong and stable in Canada,” said BMO economist Robert Kavcic.
Construction in Ontario pulled back, while it rebounded in British Columbia.
Kavcic said builders in Toronto and Vancouver are “putting up whatever they possibly can given development delays/restrictions, and the market is gobbling it up.”
London Housing Starts First quarter 2018 (2017 in brackets)
Single-detached 292 (295)
Multi-family 51 (679)
Total 343 (974)