Canada Mortgage and Housing Corp. (CMHC) says the pace of housing starts in August declined 16 per cent month-over-month.

CMHC’s monthly report released Tuesday says the seasonally adjusted annual rate of housing starts came in at 245,791 units in August, down from 293,537 in July.

In a statement, CMHC chief economist Kevin Hughes called the slowdown “notable,” as it’s well below the six-month trend. However, a sustained decline would be consistent with forecasts, he said.

“It is worth noting that current housing starts levels are generally reflective of decisions made when interest rates were receding and investor confidence was higher than it is today,” said Hughes. 

In urban markets, the decline was driven by the multi-family sector, where starts plunged by nearly 50,000 units, compared to July, to 183,000 units. Meanwhile, single-detached starts dipped 1,800 to 40,000 units.

The only province to see a rise in housing starts last month was Manitoba.

A note from TD Bank economist Rishi Sondhi said stable building permits point to a healthy pipeline of housing starts in the near term. 

“However, we expect some moderation in homebuilding in 2026 amid slowing population growth and falling rents,” said Sondhi. “Meanwhile, past declines in pre-construction home sales should keep a lid on construction in the ownership market.”