Canadian Building Construction Costs Increase in Q4

On Tuesday, Statistics Canada (StatsCan) released its Building Construction Cost Index (BCCI) for Q4. According to the BCCI, residential building construction costs rose 0.8% in the quarter, following a 0.9% increase in Q3. Nonresidential building construction costs also increased 0.8% in Q4, after a 0.6% rise in the previous quarter.

The pace of construction cost growth continued to slow compared to the pandemic and post-pandemic periods.

Year-over-year, residential building construction costs in the 15-census metropolitan area (CMA) composite rose 3.7% in Q4, while nonresidential costs increased 3.8%.

Builders noted that in Q4 the industry continued to face cost pressure from skilled labor shortages, rising labor rates, building code changes, and land availability constraints.

Residential construction costs increased across all 15 CMAs in Q4. Regina saw the largest quarterly gain at 2.5%, followed by Calgary at 1.8%. Vancouver posted the smallest increase at 0.2%.

For nonresidential buildings, construction costs rose the most in Toronto, up 1.1%, followed by Québec at 0.9%. Ottawa and Montréal each recorded 0.8% increases. Halifax and St. John’s posted the smallest gains at 0.2%, while Calgary saw no change.