The Canadian housing market continues to face challenges, as single family permits fall and are expected to drop even further in the coming year. Richard Brand, senior economist for Dodge Data and Analytics, delivered this news in the 2019 Dodge Construction Outlook for the Canadian market.

On the residential side of construction, Canadian single family permits are also witnessing decreases, with affordability reaching record lows. In 2018, single family permits dropped 8 percent to 65,900 units, and are expected to drop further to 65,300 units in 2019. At the same time, mortgage rates are climbing higher, contributing to an increased interest in renting.

The revived interest in property rentals is contributing to higher multifamily numbers than single family in recent years, Brand suggests. Multifamily permits experienced a slight 2 percent decrease in 2018 to 148,000 units, following a dramatic 10 percent up shot in 2017. A slow decline is expected to follow in 2019, with units falling 6 percent to 139,000. Vancouver and Toronto are expected to see the sharpest drop, according to Brand.

With permits on the decline for both single and multi-family housing, the market is expected to continue its shift toward a rental-based market. As of August 2018, there are 6,353 townhouse/condo complexes in planning and 34,434 townhouse/condo complexes underway.

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