November decline driven by slowdown in multi-family housing
Derrick Penner
Sun
The value of Metro Vancouver building permits dropped by a third in November, driven mostly by a big drop in applications for multi-family housing projects, Statistics Canada reported Thursday.
Builders were issued permits for $446 million worth of work in Metro Vancouver, compared with $669 million the month before.
In its report, Statistics Canada attributed the decline to a decrease in multi-family permit applications, which were down across the province almost 50 per cent from the previous month.
However, Statistics Canada analyst Nicole Charron said there is not much that can be inferred from the month-to-month drop.
“October [building permits were] particularly high,” Charron said. “There was a jump from September. [Permits] went down in November, but they were still above the September mark.”
She added that there was an increase in the number of single-family housing permits issued in November compared with October.
Peter Simpson, CEO of the Greater Vancouver Home Builders’ Association, said the November decline was likely more of a “timing issue” than indication of a trend.
Building-permit values can vary widely, especially if permits for large multi-family projects are issued in a particular month, and Simpson said there are factors that can influence the timing of permits.
Simpson added that it is taking longer for builders to obtain building permits across the Lower Mainland as short-staffed municipal building departments try to keep up with the torrid pace of building, so there may have been delays in issuing permits in November.
Builders also might be delaying permit applications until they know they have enough skilled tradespeople to proceed with a project.
November, was also a record month for new-home starts in Metro Vancouver, according to Canada Mortgage and Housing Corp. Builders started work on 2,704 new units during the month on permits already issued.
Statistics Canada also reported that the value of new Metro Vancouver homes crept up 0.2 per cent in November from October on its new-housing-price index, thanks largely to strong market conditions in the Lower Mainland.
To the end of November, Vancouver‘s new-housing-price index had increased 6.4 per cent.
To the end of November, Metro Vancouver builders had taken out $6.45 billion worth of building permits, a 4.7 per cent increase from the first 11 months of 2006.
Provincewide, builders took out a total of $901 million worth of building permits in November, a 20 per cent decline from October, with a 6.5-per-cent increase in non-residential permits to $290.5 million, offsetting some of the residential decline.
To the end of November, municipalities had issued $11.5 billion worth of building permits, a 7.1-per-cent increase from the first 11 months of 2006.
© The Vancouver Sun 2008
