The year has started off with a jolt, with some unexpected numbers coming in from Statistics Canada for November 2010 for building starts.
Contrary to the gain of 1.5% that analysts predicted, Stats Can reports that building permits fell down 11.2% to $5.5-billion. This is of particular concern, as building permits are typically barometers of the health of the housing market, and an indicator of future construction activity.
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Read More This also signals the second straight month of declines, as well as the largest single monthly drop since February 2009.
This decline in November is largely attributed to drop in the value of permits issued by municipalities for commercial space, off 23.4% to $1.26-billion. Also, multi-family dwellings like condominiums fell 22.4% to $1.08-billion.
In terms of residential permits, the decrease occurred mainly in British Columbia, where there was a significant fall in the value of multi-family permits since October, which was at its highest in May 2007. Alberta, Manitoba and Prince Edward Island also registered decreases
In total, residential permits fell by 7.2% to $3.2-billion. Seven provinces reported including British Colombia, Ontario and Newfoundland and Labrador. On the other side of the equation, Quebec experienced the largest increase by far.
There were some increases in residential permits. Intentions for single-family dwellings increased 3.4% to $2.1 billion, counteracting a 9.3% decrease in October.
Across the country, municipalities approved 14,136 new dwellings in November, down 13.4% from October. The decline came from multi-family dwellings, which fell 24.1% to 7,428 units, while single-family dwellings rose 2.6% to 6,708 units.
Non-residential permits dropped 6.1% to $2.3-billion. Commercially, lower construction intentions came mostly from laboratories in Ontario, which had had actually seen an upswing in October. Similarly, a drop in construction intentions for recreational buildings in many provinces also contributed to the decline.
City to city, many places experienced declines. In total, the value of permits fell in 19 out of the 34 census metropolitan areas. The largest decreases were seen in Vancouver, Toronto and St. John's.
Cities that experienced increases were Montréal, Victoria and Gatineau.