Building intentions for new condos plunged in August in a sign that the record boom in high-rise residential towers in several major markets – notably Toronto – may have begun to fade.
Statistics Canada said Tuesday building permits for “multi-family dwellings” fell nearly 30 per cent in August, led by Ontario. British Columbia, home to one of Canada’s other booming markets in Vancouver, was a “distant second,” StatsCan said.
“Ontario’s decrease was mainly the result of lower construction intentions for multi-family dwellings as well as institutional buildings,” StatsCan said.
StatsCan singled out a slowdown in the province’s biggest centre. “Lower intentions for multi-family dwellings drove the decline in Toronto.”
The decline was well in excess of what economists were predicting, with the consensus call pegged at a decline of 6.5 per cent.
‘Massive’ decline
CIBC called the August decline “massive” noting the dive in condo building intentions drove overall residential intentions down 16 per cent in the month.
Decreases for multi-unit dwelling were reported in six provinces in all, while they increased in Alberta and Saskatchewan – the country’s best performing economies this year.
“In Calgary, multi-family dwellings were behind the advance,” StatsCan said.
MORE: Is fresh condo boom underway in Toronto, Vancouver?
The sharp drop partially reversed an even larger gain in building permits for condos in July, which notched a massive 42.8 per cent jump nationally. July was the third month in a row of big gains in permit activity.
“Keep in mind that permits are extremely volatile, and each of the prior three months saw double-digit percentage increases,” economists at Bank of Montreal noted.
Comments