Value of building permits rose 1.1 per cent in April after two monthly declines
OTTAWA - Statistics Canada said Thursday the value of building permits issued in April was up 1.1 per cent, the first increase since January, but the higher bump fell short of expectations.
Economists had expected a four per cent increase, according to those surveyed by Thomson Reuters.
Statistics Canada said municipalities issued $6 billion worth of building permits in April, due to an increase in construction intentions in the residential sector, which more than offset a decline in the non-residential sector.
The value of residential building permits rose 2.0 per cent to $3.7 billion in April, a second consecutive monthly gain.
Most of the increase came in Ontario, Alberta and Nova Scotia, while three provinces reported declines, led by British Columbia.
The value of building permits for single-family homes rose 2.8 per cent to $2.1 billion in April, as strength in Ontario more than offset drops in five provinces led by Alberta.
Meanwhile, permits for multi-family homes increased 1.1 per cent to $1.6 billion with gains in seven provinces led by Alberta.
Contractors took out $2.3 billion in non-residential building permits, down 0.4 per cent from March as a sharp drop in the commercial segment offset gains in the institutional and industrial components.
Gains in five provinces, led by Quebec, were not enough to offset declines in the other provinces, with British Columbia again recording the largest decrease.
The commercial component fell 14.8 per cent to $1.3 billion in April, the lowest level since March 2013. Statistics Canada said the drop was due to fewer plans for retail complexes, recreational facilities, warehouses and hotels and restaurants.
The value of building permits in the institutional component rose 37.2 per cent to $664 million in April, after falling 28.9 per cent the previous month, helped by plans to build new government buildings, senior citizen residences and health care facilities.
The industrial component rose 10.5 per cent to $345 million in April, following a 12.3 per cent drop in March due to more plans for manufacturing plants and utilities buildings.
CIBC economist Nick Exarhos said in a brief note to clients that the results follow strong housing starts for April.
Canada Mortgage and Housing Corp. estimated last month that housing starts in April hit a seasonally adjusted annual rate of 194,809 units, up from the 156,592 pace set in March.
"So a more muted advance comes a bit of a surprise, though the volatility of this series and a still sizable permit overhang left over from the cold winter makes it easier to digest," Exarhos wrote in a note to clients.
"All told, limited market reaction expected, and Canadian housing should still experience a bit of a pick up from the first quarter after the effects of the unseasonably cold weather roll off."
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