Local building intentions remain strong for cheaper homes.
January 11, 2005 - The local construction market demonstrated bullish building intentions in November, according to a report Monday, defying for another month expectations of a gradual easing in the housing market.
Statistics Canada reported that $151.89 million worth of building permits were issued to Ottawa builders in November, a jump of 26.6 per cent from October.
That compared with an increase of nine per cent at the national level, making for a near record high of $5 billion. The consensus among analysts was for an increase of only 0.5 per cent.
The local gains were relatively widespread between the residential and non-residential halves of the construction market, similar to the trend seen in the national numbers for November.
In residential, the value of permits issued jumped 25.2 per cent from October, to $108.3 million.
The cheaper end of the market, multi-family units such as rowhousing and apartments, drove the increase, with permits up 60 per cent to $58.66 million. Demand for costlier single-family homes, meanwhile, eased slightly, down 0.6 per cent to $49.64 million.
While low mortgage rates and a high level of employment in the nation's capital kept the local housing market strong in 2004, there was evidently indication of easing in the breakdown of the housing permits issued in the first 11 months of the year.
On the year to date, permits for single-family homes are near flat at $582.1 million. Permits for more affordable multi-family units, however, are up almost 30 per cent on the year, to $499.45 million.
It is typical in an easing market for more expensive types of housing to first feel pressure as homebuyers look for more affordable options.
In the non-residential sector, strong gains in the industrial and institutional areas of the market make up for weak commercial activity. Non-res permits were up 30.1 per cent on the month, to $45.6 million.
On the year to date, however, the non-res sector continues to lag 2003, with total permits issued down by 20 per cent, to $49.21 million.
© Copyright Ottawa Business Journal 2005