Building starts are off 19 per cent but in line with the rest of Canada
Derrick Penner
Sun
Contractors in Metro Vancouver took out substantially fewer building permits in January and February this year than they did in 2007, Statistics Canada reported Monday.
Municipalities issued permits for $872.7 million worth of work over the first two months of the year — 19 per cent below the $1 billion worth of work approved in the same months of 2007.
Nationally, Statistics Canada said construction intentions cooled off for the fourth straight month in February, when municipalities issued permits for $5.8 billion worth of work, down one per cent from January and off the $7 billion peak of May and June in 2007.
In B.C., however, “[the] construction market has been overheated for several years, so a decline in building permits isn’t necessarily a bad thing,” said Philip Hochstein, president of the Independent Contractors and Business Association of B.C.
The “hectic pace of the past few years” has driven labour rates and materials up sharply, Hochstein added, so “a moderation in activity will bring back some certainty,” to contractors and their clients.
Some 835 large construction projects remained somewhere in the planning phase in B.C., according to the ministry of economic development’s major projects inventory, enough for Manley McLachlan, president of the B.C. Construction Association, to estimate sustained activity through at least 2011.
However, at the start of 2008, Metro Vancouver saw permit values for both residential and non-residential construction in January and February decline with non-residential permits showing the biggest drop.
Across B.C., builders took out permits on nearly $1.8 billion in work during January and February, a decline of 6.1 per cent from the first two months of 2007.
Residential construction permits in B.C. were up 15 per cent to $1.4 billion in the first two months compared with the start of 2007.
Among major centres, Kelowna posted an almost doubling of activity in the first two months of this year compared to last year, with permits on nearly $158 million in construction.
“Nationally, a marked increase in residential intentions [in February] was not enough to offset a decline in intentions in the non-residential sector,” Statistics Canada said.
Most analysts had expected the value of building permits to rise by more than one per cent in February. Values fell 3.5 per cent in January.
“Despite the weak headline number, the housing sector remains on solid footing in Canada,” said Jacqui Douglas, economics strategist at TD Securities.
