In Metro Vancouver, total starts have soared 98 per cent during the first eight months of this year compared with 2009, with 9,443 units breaking ground, reports Canada Mortgage and Housing Corp. (CMHC).
Seasonally adjusted housing starts in urban areas of B.C. increased from 20,100 units in July, after the HST was introduced, to 25,400 units in August.
The HST is payable on all new-home sales. Peter Simpson, president and CEO of the Greater Vancouver Home Builders' Association, said a change in the maximum price threshold for new homes to be exempt from the HST to $525,000 - from $400,000 - did a lot to boost builder confidence. Many new condominiums and townhomes, he said, are priced at or below the price ceiling.
The change means that new homes priced at $525,000 or less pay the same sales tax as pre-HST. Homes priced above that level qualify for a $26,500 tax rebate. Simpson noted that, while Metro starts are higher than in 2009, they remain below the five-year average.
Multiple-family housing starts in Metro Vancouver - mostly condominiums - increased 75 per cent year over year to 1,035 units in August, while single-detached housing starts in the city increased 36 per cent year over year to 334 units.
"Many centres across the Vancouver [census metropolitan area] have seen a rise in single-detached housing starts in response to strong consumer demand for ground-oriented housing," Robyn Adamache, CMHC's senior market analyst, said in a release. "Not only are developers building in areas of raw land supply, but also there has been an increase in infill developments in areas such as Vancouver City, Burnaby and Richmond."
Kelowna has experienced the largest percentage increase in housing starts this year, with 697 units, which is a 165 per cent jump from the same time period last year.
Vernon saw the largest drop in starts this year, with only 170 units built, down 4.5 per cent from the same period in 2009.
With a 0.2 per cent decline, Nanaimo is the only other urban area in B.C. to experience a decline in housing starts this year.
from Western Investor, October 2010
