US & Canada
Data from the Canada Mortgage and Housing Corporation show that Canadian housing starts came down in April, with builders responding to slowdown of sales in Toronto, Canada's largest city.
The seasonally adjusted annual rate of starts fell to 214,379 units in April from March's upwardly revised 225,459. This is 5621 units less than what the economists had forecast for April. Construction on detached urban houses dropped 9.3 percent last month, while starts on urban multiples - typically condos - declined by a milder 2.7 percent, the report showed.
"Recent readings on building permits have been indicative of the strong pace in homebuilding to open the year. Weather might have played a factor in slowing housing starts a touch in April," Royce Mendes, an economist at CIBC Capital Markets, said in a note to clients.
"That said, activity is likely to cool over the remainder of the year, with homebuilders' costs rising and the housing market no longer running at such a torrid pace," Mendes added.
Canada's once-hot housing market has cooled in recent months due to rising interest rates and stringent mortgage rules coming into play since January. While most economists expect a soft landing, some say there is a risk of a U.S.-style crash.
Still, condo demand has been strong in Toronto and Vancouver, the nation's two largest cities, in part because it is the only affordable housing left after a long boom spurred double-digit price rises in detached housing.
The report showed Toronto's housing starts trend reamined virtually unchanged in April.
"High house prices continued to deter buyers from purchasing single, semi-detached and townhome pre-construction units, and this lower demand has resulted in fewer starts for these types of units," the CMHC said in the report.
"Conversely, condominium apartments' relative affordability continues to fuel their demand. As a result, the first quarter of 2018 saw the most apartment starts recorded in a quarter in over 40 years."
In Vancouver, year-to-date starts were up for both single and multi-family units, the report showed.