Construction costs on the rise
Statistics Canada reported on February 6 that the prices for both residential and non-residential construction rose in the fourth quarter of 2019. Costs for residential building construction increased 0.5 percent, and costs for non-residential building construction rose 0.4 percent.
Construction costs for different types of residential and non-residential buildings increased during the fourth quarter. Growth ranged from 0.3 percent to 0.5 percent. The largest quarterly price increase among residential buildings was for apartment buildings (0.5 percent); construction costs for non-residential buildings increased the most for factories (0.5 percent).
Residential building construction costs increased the most in Halifax (0.8 percent), followed by Montreal and Vancouver (both up 0.7 percent). Builders in Ottawa, Montreal and Halifax reported that higher residential building construction costs were largely related to shortages in skilled trades and to contractors charging higher prices because of increased demand for housing.
Builders in Toronto, Montreal and Vancouver reported higher material prices and labour shortages.
Nationally, non-residential building construction costs rose 3.5 percent in 2019, while residential construction costs were up 2.9 percent.
Non-residential building construction costs increased the most in Ottawa (4.9 percent), Montreal (4.5 percent) and Vancouver (4.1 percent). Builders in Ottawa and Montreal reported skilled trades shortages as a cause of increasing costs.
Residential construction costs increased the most in Ottawa (5.1 percent), Vancouver (4.8 percent) and Montreal (4.1 percent) in 2019. Higher demand for residential buildings in Ottawa and Montreal resulted in upward pressures on construction costs, while lower demand in the Prairie region moderated construction costs.