Investment in Canadian Building Construction Rises in June

On Monday, Statistics Canada (StatCan) reported that investment in building construction grew 2.8% to $21.4 billion (CAD) in June, following a modest increase of 0.8% in May. On a constant dollar basis (2017=100), investment in building construction was up 2.6% to $13.0 billion in June—a 6.8% gain year-over-year.

StatCan points out that these increases partly reflect April’s record high of $13.4 billion in total building permits value, since investment levels for a given period are driven by permits issued in prior months.

Residential

Investment in residential building construction rose by 3.8% (or $546.7 million) to $15.0 billion in June. Monthly increases were recorded in nine provinces and two territories.

Overall, investment in multi-unit construction grew 6.0% (or $454.7 million) to $8.1 billion in June. Single-family home investment was up 1.4% to $6.9 billion, following two consecutive monthly declines.

Nonresidential

Investment in nonresidential construction edged up 0.4% (or $26.3 million) to $6.4 billion in June, led by growth in the commercial component, which posted a $27.2 million increase to $3.2 billion. Meanwhile, investment in both the industrial and institutional components was virtually unchanged.

Q2 Review

In Q2, investment in building construction was $62.8 billion. That is up 0.4% from Q1 and marks the fourth quarterly increase in a row. Year-over-year, investment in building construction grew 7.2%.

Investment in residential building construction increased slightly—up 0.4% to $43.7 billion in Q2. Gains in the multi-unit component of 5.1% (or $1.1 billion) were tempered by declines in the single-family home component, which posted a 4.3% decline, down $923.1 million.

Investment in the nonresidential sector edged up 0.3% to $19.1 billion in Q2, marking the 14th consecutive quarterly gain for the sector. An increase in the institutional component—up 1.9% to $5.4 billion—was moderated by declines in the industrial component—down 0.6% to $4.1 billion—and the commercial component—down 0.22% to $9.6 billion.