Skip to main content

October 28, 2021 – Statscan Reports Residential Price growth for building construction slowed in the third quarter to 3.7% after rising 7.6% in the second quarter.

In the same way, non-residential Price growth for building construction slowed to 2.8% after hitting 3.9% in the last quarter, the highest level in 13 years.

The impacts of the lower lumber price compared to the Q2 base period (May 15, 2021) – when the price was at its recent peak – did not translate into comparable price declines for the industry. Building Construction Price Index (CPPI) in Q3, Statscan adds.

Declining lumber sales in the manufacturing, wholesale and retail sectors, as well as the decline in the value of building permits for the construction of residential buildings, indicated that the increase in Demand-driven lumber prices eased in the third quarter.

Wood, plastics and composites continued to be the main contributor to the change in prices for residential building construction in the composite of 11 cities. Increases in the price of plastic resin (as measured by the Industrial Product Price Index) – attributed to disruptions in manufacturing capacity caused by severe weather earlier this year – also contributed to the increase residential building construction costs.

Plastic resin is used in a variety of materials, from electrical wire to engineered wood and PVC piping products. Non-structural wood products, such as windows and doors, were also cited by contractors as on the rise, despite the overall decline in lumber costs.

The second most important contribution to the change in prices for residential building construction was the increase in the cost of concrete and its related components, including reinforcing steel. The rise in the price of concrete has contributed the most to the rise in the cost of building high-rise apartments, as concrete is one of the main building materials in high-rise residential construction.

Contractors cited rising prices for fuel and steel reinforcement, as well as shortages of truck drivers, as the reasons for the rise in prices for concrete products.

Similar to the previous quarter, concrete, followed by metal fabrication products, was the largest contributor to the change in the cost of non-residential building construction in all 11 cities.

For both product types, contractors said recent increases in crude steel prices are attributable to supply constraints that include longer delivery times and shorter price guarantees.

Increases in labor costs, attributed to shortages of skilled labor across the industry, were also noted by contractors. Demand-driven price pressures also contributed to the continued strength of price growth for concrete and metal fabrication products in the non-residential sector.

Calgary (+ 5.4%), Edmonton (+ 4.9%) and Toronto (+ 4.5%) posted the strongest quarterly growth in residential building construction costs, all three mainly attributable to single-family homes and residential buildings. townhouses. In Calgary, contractors reported that the cost and availability of materials, increases in labor rates and the shortage of skilled labor have had an impact on the construction market.

The increases in the non-residential construction sector, continues Statscan, were led by higher construction costs in Toronto (+ 4.2%), Ottawa (+ 4.1%) and Moncton (+3, 3%).

Building construction costs for residential construction rose 20.3% year-over-year in the third quarter for the composite of 11 cities, the largest year-over-year increase since 2018 , notes Statscan. The cities that experienced the largest year-over-year change this quarter were Calgary (+ 34.4%), Ottawa (+ 28.8%) and Edmonton (+ 24.7%).

The costs of non-residential construction buildings increased 8.3% year over year, the largest increase since the third quarter of 2008. Cities with the largest change on a year-over-year basis. year over year this quarter were Ottawa (+ 13.6%), Toronto (+ 11.6%) and Montreal (+ 9.7%).