The Value of Building Permits Fell 13.5%

As a result of declines in both the residential and non-residential sectors, the value of building permits fell 13.5% to $5.6 billion in August, a level similar to the one observed in March 2008. On a year-to-date basis, permits were down 0.7% from the same period last year.

In the residential sector, the value of building permits declined by 9.3% to $3.4 billion. This decline was mainly due to a 17.5% drop in multi-family dwellings, coupled with a 3.8% decline in single-family dwellings. New Brunswick (+42.5%), Saskatchewan (+2.6%) and Prince Edward Island (+1.5%) were the only provinces with increases in the residential sector.

After double-digit increases in April and May, the value of non-residential permits declined for the second time in three months. In August, the value in the non-residential sector fell 19.3% to $2.2 billion as a result of declines in all three components (industrial, commercial, institutional).

Residential: Decline in single and multiple dwelling permits

After increasing 4.0% in July, the value of residential permits declined by 9.3% in August. Together, Quebec and Ontario accounted for almost two-thirds of the decline in the residential sector. Both provinces experienced significant drops in multi-family dwellings, after reporting double-digit increases in July. The 3.8% decline in single-family dwellings came mainly from a decrease in Quebec.

Municipalities approved 16,334 new dwellings in August, down 16.2%. The number of multiple-family dwelling units approved decreased by 26.1% to 8,269. The number of single-family dwelling units declined to 8,065, the fifth decrease in six months.

Non-residential: Decrease in all components

In August, the largest drop in the non-residential sector occurred in the institutional component. After double-digit increases from April to June, the value of institutional permits declined for a second consecutive month. A decline in educational buildings permits in Ontario was the main factor behind the 39.1% decrease in institutional permits in August.

Construction intentions for commercial buildings declined 9.6% to $1.3 billion, a third consecutive decline. Three-quarters of the decrease originated in Alberta, where the decline was principally a result of lower intentions for office buildings. Quebec also posted declines in several commercial categories.

Continuing its volatile pattern, the value of industrial permits decreased 16.6% to $414 million, after a 24.8% increase in July. The decline was the result of a lower value of permits for utility and transportation buildings in Quebec and mining buildings in Saskatchewan.

Permits down in most provinces

The value of building permits decreased in seven provinces in August. The most significant drops occurred in Ontario (-11.5% to $2.1 billion) and Alberta (-19.1% to $916 million). Both provinces experienced drops in multi-family dwellings, in addition to decreases in the non-residential sector. The values of dwellings also decreased in Quebec (-12.6% to $1.2 billion) and Saskatchewan (-45.9% to $153 million).

New Brunswick and Prince Edward Island saw increases in both the residential and non-residential sectors. Newfoundland and Labrador also reported an overall increase as a result of gains in the non-residential sector.

Metropolitan areas: Declines in Toronto and Calgary

Of the 34 census metropolitan areas, 20 recorded declines in the value of building permits in August.

The largest decreases occurred in Toronto and Calgary, with drops mainly in multi-family dwellings and non-residential buildings. Ottawa–Gatineau and Kitchener experienced declines in both sectors.

In contrast, Vancouver and Hamilton recorded increases as a result of advances for both single and multiple-family dwellings.

Available on CANSIM: tables 026-0001 to 026-0008 and 026-0010.

Definitions, data sources and methods: survey number 2802.

The August 2008 issue of Building Permits (64-001-XWE, free) will be available soon.

The September building permit estimate will be released on November 6.

To order data, contact Jasmine Gaudreault (toll-free 1-800-579-8533; 613-951-6321; bdp_information@statcan.gc.ca). For more information, or to enquire about the concepts, methods or data quality of this release, contact Nicole Charron (613-951-0087), Investment and Capital Stock Division.