Canada's Housing, Construction Sectors Start Recovery

Ottawa, Ontario (AHN) - Canada's housing and construction sectors are beginning to recover as reflected in building permits and housing starts data released Tuesday.

According to Statistics Canada, the value of building permit applications went up unexpectedly to 1.8 percent to $6.4 billion in July, a major turnaround from a 5.3 percent decline in June.

StatsCan said the hike was because of a large number of applications for multi-family dwellings in Central Canada and planned industrial buildings in Saskatchewan's mining sector. The largest increase was due to residential and non-residential building permit applications in Quebec, which leapfrogged in July by 13.2 percent to $1.3 billion.

Douglas Porter, deputy chief economist of BMO Nesbitt Burns, explained to the Globe and Mail, "Overall, this report is a little bit better than expected, and it shows that the building industry is certainly not going into a tailspin by any stretch of the imagination."

Meanwhile, the Canada Mortgage and Housing Corporation said new housing starts went up to 211,000 units in August from 186,500 units in July. The bulk of the projects were in Ontario, which logged an 81 percent increase, while in other Canadian provinces the rate dipped.

The fall was up to 22.5 percent in the Prairies and 11.5 percent in Atlantic Canada. Lesser declines were registered in Quebec and British Columbia.