New housing construction in Calgary, Alta., Thursday, June 26, 2014.Jeff McIntosh/The Globe and Mail
The Globe's Real Estate Beat offers news and analysis on the Canadian housing market from real estate reporter Tara Perkins. Read more on The Globe's housing page and follow Tara on Twitter @TaraPerkins.
Alberta's hot economy is fuelling a housing boom that's further stoking its economy. And that means for the first time Alberta could soon be building more homes than all of Quebec and the Atlantic region combined, even though it has less than half the population, says Bank of Montreal economist Robert Kavcic.
"This about sums up the East-West split in Canada," the senior economist writes in a research note. "Housing starts in Alberta have averaged just over 43,000 annualized units in the latest 3 months, near 2006/7 boom levels. On the flip side, activity in all of Quebec and Atlantic Canada has faded to 47,000 units, below the lows seen during the recession."
He notes that the trends are mirroring population flows, with Alberta continuing to be a magnet for job-seekers.
Home construction and the housing market are major drivers in the Canadian economy, as the Canadian Home Builders' Association loves to point out. It has estimated that the value of new residential construction in the country last year was $47.1-billion, which generated $17.6-billion worth of wages. Including renovations and other housing spending, it estimates the total value at $120.4-billion for last year, generating $49.7-billion in wages.
Alberta had 36,011 housing starts last year, and the homebuilders' association says housing generated total wages in that province of $7.9-billion. Quebec, which has roughly double the population, had 37,758 housing starts, with the industry generating $11.1-billion of wages.