Housing starts in Canada hit their highest total in a decade in 2017, but are expected to slow this year, economists said Monday.

Bank of Montreal senior economist Robert Kavcic said the full-year tally of housing starts for 2017 came in at 221,000.

“Canadian homebuilding activity had its best year in a decade in 2017, backed by underlying demographic support and strengthening labour markets in the country’s largest provinces,” he wrote in a report.

However, he noted that this year the number of starts is expected to moderate closer to the 200,000 level, with a record number units under construction to start the year.

Canada Mortgage and Housing Corp. said Tuesday the seasonally adjusted annual rate of housing starts for December of 2017 came in at 216,980 units, down from 251,675 units in November. The six-month moving average for December was 226,777 compared with 226,178 in November.

The housing agency said the overall decline in the annual pace of housing starts in December came as the pace of urban starts fell 15.1% to 198,132 units for the final month of last year.

The pace of multi-unit urban starts slowed 22% to 135,176, while the rate of single-detached urban starts increased by 4.7% to 62,956 units.

Rural starts were estimated at a seasonally adjusted annual rate of 18,848 units.

The housing market has been identified as a key risk to the economy and been scrutinized by economists and policy-makers.

Rising interest rates and more stringent lending rules are expected to weigh on the market this year.

Royal Bank of Canada assistant chief economist Paul Ferley said the total number of starts for 2017 were up 11.4% from 198,000 in 2016.

“Looking ahead, our expectation is that recent tightening of mortgage lending, further official interest rate increases in both Canada and the U.S. and current poor affordability in a number of key markets will contribute to housing starts continuing to trend lower.

“Our forecast assumes that starts will drop to 195,000 this year and 185,000 in 2019.”