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Value of buildings permits bounces back in May

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The total value of building permits for May 2020.

May proved to be a good month for the value of building permits. The total bounced back to 20.2 per cent to $7.4 billion, following declines of 13.4 per cent in March and 14.4 per cent in April.

This was the largest percentage increase since March 2009, and it coincided with the relaxing of COVID-19 construction restrictions in Ontario, Quebec, and Prince Edward Island. The May level is still 20.4 per cent below the last peak observed in January 2020. All provinces still had public health guidelines in place during May, however, Ontario, Quebec and Prince Edward Island had the most impactful policy changes during the month, reports Statistics Canada.

In Ontario, some non-residential construction projects were reopened starting May 4. Additionally, the province moved into “Stage 1” of reopening on May 19, which included a full resumption of all construction projects.

In Quebec, all sectors of the construction industry in all regions were authorized to resume activity on May 11 under strict guidelines of the Commission des normes, de l’équité, de la santé et de la sécurité du travail.

Lastly, in Prince Edward Island, new construction projects were permitted to start on May 1, following a five-week work stoppage.

Reflecting these policy changes, the largest increases in the value of permits were in Quebec and Ontario. Prince Edward Island posted the largest gain in the value of permits among the Atlantic provinces and the largest percentage increase across the country with an increase of 1,019.5 per cent, following a drastic 87.6 per cent drop in April.

The total value of residential permits was up in six provinces in May, increasing 18.7 per cent to $4.8 billion nationally. The largest increase was in Quebec, up 53.4 per cent for the month. On April 20, Quebec reopened residential construction to be delivered by July 31; the remainder of the construction sector was reopened on May 11.

Residential gains were attributable to increases in the value of permits for single-family homes, which rose by a record $518 million, following a drop of 34.6 per cent in April. Seven provinces reported gains, led by Ontario and Quebec.

The value of permits for multi-family dwellings increased nine per cent to $2.9 billion, driven by projects in the Montreal and Vancouver census metropolitan areas (CMAs).

Non-residential permits increase

The value of commercial permits was up 20.8 per cent to $2.5 billion in May, with the largest increases reported in Ontario and Quebec. Industrial permits jumped 57.6 per cent to $600 million, following a substantial decrease in April. This increase was largely jumped 57.6 per cent to $600 million, following a substantial decrease in April. This increase was largely driven by a permit for a Molson brewery in the CMA of Montreal. Institutional permits posted their first gain for 2020, increasing 2.8 per cent to $544 million. Permits for post-secondary institutions led to the increase.

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