Canadian housing starts climb, sparking fears market is overheating

Daniel Acker | Bloomberg

Daniel Acker | Bloomberg

Reblogged from The Financial Post, Reuters

TORONTO — Canadian housing starts rose more than expected in October and September starts were revised higher, according to data released on Friday that will add to fears the property sector could be overheating.

Data from the Canada Mortgage and Housing Corp showed the seasonally adjusted annualized rate of housing starts was 198,282 units last month, up from an upwardly revised 195,929 in September and surpassing analysts’ expectations for 190,800.

Multiple urban starts registered a slight increase of 0.9% to 115,011 units in October while the single urban starts segment saw a decrease of 1.7% to 62,423 units, the federal housing agency said.

“The trend in total housing starts has gained momentum since July, which is in line with expectations that new construction would strengthen over the second half of 2013,” Mathieu Laberge, deputy chief economist at CMHC said.

Canada’s housing market has rebounded in 2013 after a sharp slowdown in the second half of 2012 when the government tightened mortgage lending rules to prevent homebuyers from taking on too much debt.

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