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B.C. outpacing rest of country in hike in building permits

Eric Beauchesne
Sun

The economy may be slowing, but nobody seems to have told home-builders.

Housing construction, fuelled by consumer confidence and low interest rates, is booming and should continue to do so for months to come, Statistics Canada said Tuesday.

“The country’s residential sector continues to perform at a torrid pace, setting records for both single-family and multi-family permits for the first half of the year,” it said.

In B.C. the January to June 2003 total for residential permits hit $2.1 billion, a 17.3-per-cent increase over the same period for 2002, well outpacing the national increase of 8.0 per cent.

“The residential sector’s vibrancy appears to underscore consumer confidence in investment in housing,” it continued. “Modest mortgage rates and a generally favourable job environment have encouraged people to abandon rental accommodations in favour of home ownership.”

The result: rising rental vacancy rates in some cities, including Toronto and Ottawa, and a surge in building plans for row housing (more affordable for first-time homebuyers) to a near 10-year high, StatsCan said.

The value of building permits issued for single-family homes hit a high of $10.7 billion in the first six months of the year, up 2.2 per cent from a year earlier, it said. And the value of multi-family permits issued also posted a new record of $4.4 billion, up 9.9 per cent from the same six months last year.

“In June alone, [Canadian] builders took out $1.8 billion worth of permits for single-family homes, up 4.3 per cent from May,” StatsCan said. “The value of permits for multi-family dwellings rose 5.2 per cent to $788 million in the wake of a record month for row-housing permits.”

And it’s not just homes that are hot.

An increase in institutional construction plans, particularly for medical buildings, and especially in Alberta, helped boost over-all building construction plans in June to $4.3 billion, up 4.3 per cent and four times what analysts had expected.

That was only the third monthly in-crease this year, but was still enough to boost the value of permits issued during the first half of the year to a record $24.9 billion, an eight-per-cent jump from the same period last year.

“This signals strong activity on construction sites for some time to come,” Statistics Canada said.

However, RBC economist Allan Seychuk cautioned that construction permits are a “volatile indicator that does not lead in lock-step fashion to corresponding gains in construction activity.”

While home-building has been a consistent source of economic strength for two years and this year’s level is up from a record year in 2002, he warned it may cushion the economy against the impact of slower U.S. growth and the stronger Canadian dollar.

As such, he said, the news does not offset the need for a further cut in interest rates by the Bank of Canada before summer’s end.

Canadian municipalities issued $1.7 billion in non-residential permits in June, up 3.9 per cent from May.

“In the first half of the year, non-residential construction intentions reached a record $9.8 billion, a strong growth of 14.3 per cent from the first six months of 2002,” it said.

Declines in Vancouver led to a 2.5-per-cent decrease in B.C. to $850 million in non-residential construction.

Ontario and Alberta recorded non-residential increases of 13.9 per cent (to $4.7 billion) and 25.1 per cent (to $1.3 billion) respectively.

© Copyright  2003 Vancouver Sun

More than 4,000 houses, townhomes and condos sold

Wyng Chow
Sun

Residential property sales in Greater Vancouver soared by a whopping 50 per cent last month over the same period a year ago, establishing a record for volume in July.

Multiple Listing Service figures released Friday show a total of 4,023 detached houses, townhomes and condominiums sold last month, compared to 2,670 units the previous year.

“According to our records, [Greater Vancouver] has never recorded sales of over 3,000 [units] for the month of July,” said Bill Binnie, president of the Real Estate Board of Greater Vancouver.

“Not only that, but these are the highest figures recorded for any month over the past 11 years. March 1992 was the last time we saw sales surpass the 4,000 mark.”

Condos and townhomes were the hot tickets last month, with year-over-year sales climbing 62.6 per cent and 61.3 per cent, respectively.

A total of 1,565 condos changed hands through the MLS in July, compared to 970 units the previous year. Among townhomes, 639 units sold, up from 393 units a year ago.

Sales of detached houses climbed 39.2 per cent last month to 1,819 units, up from 1,659 in July 2002.

“Consumer confidence, continuing demand, excitement over the Olympics — these may all be factors contributing to the current level of activity,” Binnie said.

“Combine these factors with the historic low interest rates and the result is the most dynamic market we’ve seen in a decade.”

In the six Fraser Valley communities, a total of 1,915 housing units sold on the MLS last month, up 42.5 per cent from 1,344 in July 2002.

© Copyright  2003 Vancouver Sun

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