Canada’s seasonally adjusted annual rate of housing starts increased to 128,400 units in May from 117,600 units in April, according to Canada Mortgage and Housing Corp. (CMHC).

Economists had forecast 126,000 starts, on an annualized basis.

“The increase in May is broadly based, encompassing both the singles and multiples segments,” says Bob Dugan, chief economist at CMHC’s Market Analysis Centre.

CMHC says housing starts are expected to improve throughout 2009 and over the next several years to gradually become more closely aligned to demographic demand, which is currently estimated at about 175,000 units per year.

The seasonally adjusted annual rate of urban starts increased 11.1% to 107,800 units in May. Urban multiple starts increased 11.1% to 60,900 units, while urban single starts also moved up by 11.1% to 46,900 units in May.

May’s seasonally adjusted annual rate of urban starts increased 22.0% in Ontario, 16.8% in the Prairies, 7.3% in Atlantic Canada, and 3.3% in Quebec. Urban starts declined 5.0% in British Columbia.

Rural starts were estimated at a seasonally adjusted annual rate of 20,600 units in May.

IE