BUSINESS
01/11/2019 12:05 EST | Updated 01/11/2019 13:03 EST

'No More Detached Homes For You', BMO Declares

Say goodbye to the dream of owning a single-family home.

Condominiums are seen under construction in Toronto in this June 19, 2009 file photo.
Chris Roussakis / Reuters
Condominiums are seen under construction in Toronto in this June 19, 2009 file photo.

Construction of detached, single-family homes is at record lows in Canada, but the story for condos couldn't be more different.

Single-family home construction was at its lowest levels since the mid-1990s, but multi-family buildings like condos were at record highs, the Bank of Montreal said in a Thursday note to clients entitled "No More Detached Homes For You."

Watch: Canada's priciest condo re-listed with a serious price cut. Story continues below.

BMO senior economist Robert Kavcic told HuffPost Canada the 1970s were last time multi-family building construction was this high.

"The demographic demand is there... it's just that the kind of units we're getting look a lot different than we during the 80s and 90s and early 2000s— just a lot smaller, and a lot more condensed," he said.

Kavcic said the shift to more multi-unit construction is "probably not going to go away."

"So you have two factors: you have overall activity probably slowing down a little bit, and then you still have single-detached construction shrinking a little bit as a share of the overall stock," he said.

"So probably not a whole lot of new construction for single, detached homes coming."

BMO

The housing construction trend is "very much a Toronto and Vancouver story," with Montreal and Ottawa "to some extent too," Kavcic said.

"As you get into the smaller cities— those cities like a Calgary or Edmonton or Regina that don't have the same kind of policy constraints that we have in other markets like Toronto or geographic constraints that we have in a market like Vancouver— that kind of dramatic split starts to go away," he said.

"You see it at the national level because the biggest cities are what's driving this."

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