Statistics Canada releases latest construction intention numbers
The total value of building permits in Canada declined by 1.4% in October to $10 billion, with markedly lower residential investment offsetting gains in the non-residential sector, according to the national statistics agency.
Persistent economic sluggishness, which the International Monetary Fund is not expecting to subside for Canada any time soon, has led to residential construction investment decelerating for the second consecutive month.
Statistics Canada reported that the total value of residential permits fell by 6.4% to $6.5 billion in October, with the number of new residential units experiencing a similar 4.6% decline during the same month. The weakness was mainly due to the single-family segment (down by 9.3%), which slowed down for the fifth straight month.
The value of multi-family building permits also fell by 6.9%, mainly pulled down by Ontario’s second consecutive monthly decline and by a significant drop-off in Nova Scotia immediately after a record high in September.
Royal Bank of Canada recently warned that the housing market is likely to remain muted nationwide over the next few months.
“The sharp interest rate increases to date and likelihood of additional hikes in the coming months … will continue to hold back buyers,” RBC said. “We see this depressing demand further though some markets may have more limited room to fall.”
Non-residential construction investment up
The total value of non-residential permits across Canada grew by 9.5% to $3.5 billion in October. The major contributor to this trend was the sharp 18% increase in commercial construction permits and the similarly substantial 16.2% upswing in industrial intentions, StatCan said.
Meanwhile, institutional construction is still in the doldrums with a 17.1% deceleration in October, following a 38.2% decrease in September. StatCan said that this reading reached its lowest level since May 2020.
