Spike in home prices, lack of existing homes, drive ‘historic highs’ in construction: CMHC

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VANCOUVER (NEWS 1130) – Condo construction in the Vancouver area is surging to the highest level since 1990, as prices for existing homes continue to soar.

Canada’s housing agency says work began on 2,535 units last month, 50 per cent more than the previous June. That’s only about 400 fewer than the Greater Toronto Area, even though the GTA has more than twice as many people.

Even using a smoothed-out measure, the six-month moving average of seasonally adjusted annualized rates, housing starts in BC cities topped 41,000 and were 2,400 ahead of the May level. They haven’t been that high for about 16 years.

Canada Mortgage and Housing Corporation economist Carol Frketich says “The inventory of new completed and unsold homes is extremely low.”

She adds “a lack of existing homes for sale, rising home prices and low rental vacancy rates have spurred new home construction.”

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