A multi-residential construction decline drove down overall Canadian housing starts in April, says the Canada Mortgage and Housing Corporation.

Multi-unit housing starts fell 11% nationally year-over-year in April as high 2023 borrowing costs took their toll on the market, said CMHC in its monthly housing report. By contrast single-family home starts rose 3%.

The high borrowing costs resulted from a series of Bank of Canada interest-rate increases implemented between 2022 and 2023.

CMHC measures housing starts two ways: Through a seasonally adjusted methodology and on an actual basis.

The actual number of overall starts sank 9% to 18,486 units in April 2024 from 20,231 a year earlier.

The seasonally adjusted annual rate (SAAR) declined a modest 1% to 240,229 units in April 2024 from 242,267 in March 2024.

The CMHC report covers urban centres with populations of 10,000 or more. April’s actual overall housing starts fell year-over-year in Canada’s three largest cities, dropping 38% in Toronto, 30% in Vancouver and just 3% in Montreal.

“The multi-unit volatility observed in Toronto, Vancouver, and Montréal in recent months is unsurprising as we continue to see last year’s challenging borrowing conditions reflected in multi-unit housing starts numbers,” said Bob Dugan, CMHC’s chief economist, in a news release.

“We expect to see continued downward pressure in these large centres.”

The impact was less severe on a seasonally adjusted basis. While Vancouver and Toronto’s starts declined more modestly, Montreal’s total starts increased 41% due to a 50% gain in multi-unit starts.

CMHC forecasted earlier that Canadian housing starts would decline in 2024 due to a reduction in rental residential construction projects. The forecast was published in CMHC’s latest Housing Market Outlook (HMO).