Canadian Construction Seen Tapering Off

Canada is likely to see residential construction taper off this year from last year's all-time high but still remain historically strong, according to Canada Mortgage and Housing Corp.'s latest housing market outlook."The outlook for housing starts remains upbeat for this year and next," said Bob Dugan, chief economist at CMHC. "However, a slight rise in mortgage rates, eroding pent-up demand, slower employment growth, and waning spill-over of buyers from the existing home market are some of the factors that point to a gradual slowing in the pace of new home construction." The corporation has forecast a 7.3% decline in residential construction in 2005 to 216,400 units. This would still be the third-highest level for housing starts in 17 years, according to the corporation. The corporation can be found online at http://www.cmhc-schl.gc.ca.