Led by multi-family home construction, new home starts in Canada went up in September — albeit slightly — even as the global financial crisis hit North America and Europe, according to CMHC figures released Wednesday.

Canada Housing and Mortgage Corp. said 217,600 units were started in September, up marginally from 217,400 in August.

The increase occurred despite a month when world stock markets were rocked by brokerage house bankruptcies and the takeover of ailing banks and other lending institutions.

“Higher starts of multiple-family homes were behind the rise in new home construction activity in September," said Bob Dugan, chief economist at CMHC’s Market Analysis Centre.

Many analysts, however, have said housing activity should fall faster as consumers begin to feel the effects of shrinking investments and mortgage lenders start reducing what they dole out to home builders and individual purchasers.

In September, the number of urban starts of single-family homes in Canada fell by 8.1 per cent, compared with August.

In addition, for the first nine months of the year, the number of rural and urban home starts slipped by 5.7 per cent from the same period in 2007.

But urban starts rose or stayed the same in every province except Ontario, where the indicator slipped in September by 6.6 per cent, compared with August.

Still, as a sign of the slowing economy in Alberta, housing starts for single detached homes in Calgary hit their lowest levels in two decades in September. Starts in the month dropped 56 per cent over the same time last year.

CMHC's analysts in Calgary said contractors and developers are staying away from speculative construction and are trying to decrease their inventory.

Canada can expect a drop of 10 to 15 per cent in new home demand from current levels, "more so if demand softens more substantially over the next few years," Scotiabank economist Adrienne Warren wrote in August.

In its own August update, CMHC predicted that new housing starts will fall to 215,475 in 2008, a drop of 5.6 per cent from 2007, and slip again to 194,100 in 2009, a further reduction of 9.9 per cent.