The 2020 Mid-Year Economic Update_long

Canadian Building Permits Down 7% in March

Decrease attributed to lower construction intentions for commercial buildings in 3 provinces.

The value of Canadian building permits issued by municipalities decreased 7 percent to C$6.9 billion (US$5.4 billion) in March, marking the second decline in three months, according to Statistics Canada. The decrease, which followed a 15.3 percent gain in February, was largely the result of lower construction intentions for commercial buildings in Alberta, Ontario and British Columbia.

In the non-residential sector, the value of building permits was down 22.8 percent to C$2.4 billion (US$1.9 billion) in March, following a 32.6 percent increase the previous month. Declines were reported in half the provinces, with Alberta responsible for most of the drop, followed by British Columbia and Ontario.

The value of residential permits rose 4.8 percent to C$4.4 billion (US$3.4 billion) in March, a second consecutive monthly increase. Gains were posted in seven provinces, led by Ontario, British Columbia and Nova Scotia. The largest decline in residential construction intentions was reported in Alberta.

All three components of the non-residential sector decreased in March, led by commercial buildings.

The value of permits for commercial buildings was down 27.7 percent to C$1.5 billion (US$1.2 billion) in March, partially offsetting the 56.6 percent increase in February. At the national level, the decline was mainly the result of lower construction intentions for recreational facilities and retail complexes, which recorded large increases the previous month. Decreases were posted in five provinces, led by Alberta, followed distantly by Ontario and British Columbia.

In the institutional component, the value of permits was down 12.2 percent to C$591 million (US$459.5 million) in March, after posting an increase of 17.5 percent the previous month. The decrease resulted mostly from lower construction intentions for secondary schools, other government buildings and health clinics. Declines were posted in five provinces, most notably Alberta, Quebec and Saskatchewan. Ontario registered the largest advance in the component.

The value of industrial building permits was down 17.1 percent to C$395 million (US$307.1 million) in March, a second consecutive monthly decline. Lower construction intentions for maintenance-related buildings, utilities buildings and manufacturing plants were responsible for much of the decrease. The decline was spread among five provinces, led by Manitoba. The biggest increase was recorded in Alberta.

Construction intentions for multi-family dwellings rose 12.1 percent to C$2 billion (US$1.6 billion) in March. Gains were reported in every province, except Alberta. Ontario posted the largest advance, followed by British Columbia and Nova Scotia.

The value of permits for single-family dwellings edged down 0.5 percent to C$2.4 billion (US$1.9 billion), following a 10 percent increase in February. Declines were spread among five provinces, led by British Columbia. Ontario recorded the most notable increase.

Municipalities approved the construction of 15,674 new dwellings in March, down 1.4 percent from the previous month. The decline resulted from single-family dwellings, which fell 7.9 percent to 5,623 new units. Conversely, multi-family dwellings were up 2.6 percent to 10,051 new units.

The total value of building permits was down in four provinces in March, with Alberta posting the largest decrease, followed by British Columbia and Saskatchewan.

In Alberta, the value of building permits dropped 41.3 percent to C$931 million (US$723.9 million), following a 43.3 percent increase in February. Construction intentions declined in every component, except industrial buildings. Commercial buildings and multi-family dwellings accounted for most of the decrease.

The value of building permits in British Columbia was down 5.2 percent to C$1.1 billion (US$855.3 million) in March, registering a third consecutive monthly decline. The drop was the result of lower construction intentions in every component, with the exception of multi-family dwellings. Commercial structures accounted for the majority of the decrease.

In Saskatchewan, the value of building permits fell 27.8 percent to C$127 million (US$98.7 million), a third consecutive monthly decline. The decrease came from a drop in construction intentions for institutional buildings, which were at their lowest level since October 2014, and single-family dwellings.

In March, the value of building permits was down in 14 of the 34 census metropolitan areas. The decline was mainly attributable to lower permit values in Edmonton, Oshawa and Victoria.

The value of building permits in Edmonton fell 64.8 percent in March, following a record high in February. The decrease was the result of lower construction intentions for commercial buildings and, to a lesser degree, multi-family dwellings and institutional structures.

In Oshawa, the decline was attributable to lower residential construction intentions, mainly single-family dwellings, while in Victoria, multi-family dwellings and commercial buildings were responsible for the decrease.

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