MNI DATA ANALYSIS:Cdn Bldg Permits Point To More Condo Supply>

By Yali N'Diaye

     OTTAWA (MNI) - The value of building permits issued by Canadian 

municipalities increased by 6.0% in December to a record high C$8.8 

billion, pointing to more housing supply ahead, data from Statistics 

Canada showed Wednesday. 

     The monthly gain was the fourth consecutive one and the largest 

since May 2017, lifting the 12-month growth rate to 10.6%, the highest 

in a year. 

     For 2018 as a whole, construction intentions were up 4.7%, 

following a 10.9% increase the previous year, on a unadjusted basis, and 

marking a fifth consecutive annual increase. Residential permits rose 

5.2% as a 22.7% gain in multi-family dwellings more than offset a 10.7% 

drop in single-family, the first decrease since 2013. 

     Non-residential permits were up 3.7% in 2018 after rising 15.6% in 

2017. 

     - MULTI-FAMILY, COMMERCIAL LEAD 

     The December report pointed to an increase of housing supply in 

months ahead, both in the residential and non-residential sectors. 

     However, within the residential sector, the picture showed a 

continued divergence between single-family dwellings, for which permits 

fell 5.4% on the month, and multi-family dwellings, for which permits 

rose 11.1% to a record high level of C$3.3 billion. 

     In the non-residential sector, gains were led by commercial 

buildings (+14.6%), and industrial buildings (+11.9%). Meanwhile, 

construction intentions for institutional buildings fell 10.6%, led by 

hospitals. 

     - BRITISH COLUMBIA, ONTARIO POST GAINS 

     Regionally, six of 10 provinces recorded gains, led by British 

Columbia, with permits up 22.0%. 

     Construction intentions in Ontario rose 3.1%. 

     The country's most expensive markets, Vancouver and Toronto, also 

recorded higher construction intentions, with gains of 26.3% and 3.5%, 

respectively, on the month. 

     For the two metropolitan areas, the increase was led by 

multi-family dwellings in the residential sector. 

     The expansion of multi-family supply is consistent with higher 

interest rates and more stringent mortgage finance rules that impacted 

affordability, likely driving buyers to smaller more affordable options 

such as condominiums, relative to single-family homes. 

     The Toronto Real Estate Board said Wednesday that according to an 

Ipsos Home Buyers Survey conducted, "the share of buyers intending to 

purchase a detached home is at the lowest level since the fall survey 

was introduced in 2015." 

     "Higher density home types, which have a lower price point on 

average, have become more popular with intending buyers," found the 

survey conducted for TREB. 

     The Board expects flat listings this year, while the Ipsos survey 

points to a slight decrease in listing intentions. 

--MNI Ottawa Bureau; email: yali.ndiaye@marketnews.com 

[TOPICS: M$C$$$,MACDS$]