Housing Starts Pullback in May Consistent With View of Weaker Data for Rest of Year, Says TD

09:18 AM EDT, 06/15/2026 (MT Newswires) -- Canadian housing starts came in at 261,400 annualized units in May, marking a 6% month-over-month decline from April's level, noted TD Economics on Monday after the release of data from the Canadian Mortgage and Housing Corp. (CMHC).

On a trend basis, the six-month moving average of starts remained relatively unchanged at 258,000 units, TD also noted.

TD noted May's decline was concentrated in the multi-family sector, with urban starts down 10% month over month to 205,300 units. Meanwhile, urban single-detached starts increased 13% month over month to 41,700 units and urban starts were down in six of 10 provinces.

In looking at the key implications of the data, TD cited an as-expected pullback in May after April's elevated print, with sinking building permits pointing to additional near-term moderation. Still, starts are tracking higher in Q2 than in Q1, suggesting some upside to the residential component of gross domestic product, it said.

May's drop is consistent with the bank's view that housing starts are set to grind lower as the year wears on, TD added, while noting headwinds for homebuilding include weak population growth, elevated levels of unsold inventories, climbing rental vacancy rates and past weakness in pre-construction sales.

The recent removal of the HST on all new builds in Ontario should spur demand, but lags between pre-sales and starts mean any boost is likely a story for next year and 2028, said TD.

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