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[Russ]

Housing starts catch a chill, fall 21% ROMA LUCIW Thursday, March 08, 2007 The pace of new-home construction plummeted 21 per cent to its lowest level in nearly three years in an unusually wintry February after warm weather sent construction soaring in January, Canada Mortgage and Housing Corp. said Thursday. Housing starts fell to a seasonally adjusted annual rate of 196,200 units in what turned out to be a freezing-cold February from 248,500 units in a temperate January. Economists were expecting starts would fall just 11.5 per cent to 220,000 units, according to a poll by Bloomberg. Mark Chandler, fixed-income strategist for Royal Bank of Canada, said the monthly fall was “somewhat deceiving,"given the extreme weather patterns of the two months. He noted that Torontonians experienced the coldest average temperature since 1979 last month. It is the first time January, 2005, that starts have dipped below 200,000. A 33 per cent decline in multiple-unit starts led February's fall, with single-unit components dropping 12.6 per cent. The monthly drop was spread out across all regions of the country. "Following the unusually strong surge in construction activity in January, which was partly attributable to the unseasonably warm weather, housing starts in February returned to levels more in line with expectations," said Bob Dugan, CMHC's chief economist, in a release. The blistering pace of new-home construction is expected to ease this year. Mr. Dugan said that although starts will rebound in the coming months, they will slow to 209,500 units in 2007 from 227,395 in 2006. Jacqui Douglas, economics strategist at TD Securities, said starts are now at their lowest level since May 2003. Although the housing data continued its zig-zagging pattern in February, the three-month and six-month trends imply the housing market is “still perfectly healthy, despite the jerky numbers," she said. The volatile monthly numbers will "even out once we return to normal weather patterns," Ms. Douglas said. She expects starts will come in just over 200,000 this year. Meanwhile, Statistics Canada said Thursday that new-home prices edged 0.3 per cent higher in January, after remaining unchanged in December. That lead to a year-over-year rise the selling prices charged by contractors of 10.1 per cent, down from 10.7 per cent the previous month. "The decline in the pace of house price appreciation is to be expected after the unusually large gains in recent years, and should not be a cause for alarm," Ms. Douglas said. "The Canadian housing market is on much more stable footing than its U.S. counterpart, and is merely returning to more sustainable growth levels." The Globe and Mail

[pdx5]

Those Canadians probably are wishing global warming gets here soon..eh?