The construction sector is presently generating several big news stories. One relates to building material costs; another concerns infrastructure spending plans. But in this article, through standalone graphs, I’d like to show the boom that is currently underway in housing starts, evident more so in Canada, but also quite apparent in the United States.
In March, U.S. housing starts climbed above 1.7 million units seasonally adjusted and annualized (SAAR) for the first time since before the previous recession (i.e., the 2008-09 ‘global financial crisis’). Meanwhile, in Canada, housing starts have soared more than 50% above their long-term average (200,000 units) and 20% beyond their previous cyclical high point (277,000 units).
In March, Canadian new home starts skyrocketed to 335,000 units SAAR, according to CMHC. That’s a figure I doubt many analysts thought they would see any time soon, especially given that population growth through immigration has slowed to a crawl due to pandemic-related border-crossing closures.
Absent the inflow of individuals from afar, the housing booms in both the U.S. and Canada are being generated domestically. Working from home to combat COVID-19’s spread is inspiring a whole lot of people to want to upgrade the ambience of where they are now spending almost all their time.
Plus, bargain interest rates are hanging on ‘financing trees’ like bright shiny baubles to be grabbed before they disappear.
In the following 12 graphs, the text boxes will lead readers through a story that will hopefully be the first of many indicating much sturdier underpinnings for the U.S. and Canadian economies as we transition away from the health crisis and towards sunnier prospects.
