According to Statistics Canada (StatCan), the country saw a notable drop in building permits month over month, with the total value of building permits in Canada decreasing 11.7% to $10.5B in March.
Construction intentions in the non-residential component declined 16.7% to $4.0B, while the residential sector decreased by 8.3% to $6.5B. Declines were observed in all components except for the commercial component, according to Canada’s national statistical office. On a constant dollar basis (2017=100), the total value of building permits fell 11.6% in March, following two consecutive months of increases to start off the year.
According to StatCan, monthly declines in industrial construction intentions pushed down the non-residential sector. The decrease in non-residential construction intentions came in large part from reductions in the industrial (-46.1%; -$629.8 million) and institutional (-22.2%; -$293.1 million) components. The large decline in the industrial component was due to the lack of major industrial permits issued in March compared with February, which was actually the second-highest monthly level recorded, says StatCan.
Meanwhile, the commercial component grew 5.8% to $2.2B in March – one piece of good news in an otherwise slightly defeating report.
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Across the country, the value of residential building permits decreased 8.3% to $6.5B with Ontario (-13.7%; -$377.4M) leading the decline in value for both single-family and multi-family dwelling permits. Despite the overall decline, the residential sector grew in Quebec (+7.3%; +$90.1M), Prince Edward Island (+70.4%; +$14.3M), Saskatchewan (+10.3%; +$6.3M), Newfoundland and Labrador (+7.7%; +$2.2M) and Manitoba (+0.9%; +$1.4M).
In total, some 16,800 new multi-unit dwellings and 4,200 new single-family homes were authorized in March in Canada. While from April 2023 to March 2024, a total of 260,200 new units were authorized.
As StatCan highlights, the first quarter of 2024 is rebounding, driven by growth in construction intentions in the commercial component. The total value of building permits in the first quarter of 2024 was $33.4B, a 3.7% increase from the previous quarter ($32.2B). This represents a partial rebound from the fourth quarter of 2023, which was the lowest quarterly total value since the third quarter of 2021 ($30.5B).
The growth was driven by British Columbia (+20.1%; +$988.4M), which posted significant gains in the commercial and industrial non-residential components, and in the multi-unit residential component. Despite quarterly gains, however, construction intentions in the first quarter of 2024 remained lower than the average quarterly levels of the previous two years.
Construction intentions in the non-residential sector increased 6.9% to $13.0B in the first quarter, led by the commercial component (+22.3% to $6.6B), which posted the highest level of the previous four quarters. Somewhat surprisingly, growth was driven by permits for office buildings. Overall, nine provinces and territories reported increases in commercial construction intentions, led by Ontario (+34.8%; +$710.1M), Quebec (+31.2%; +$296.6M) and British Columbia (+32.4%; +$269.3M).
