The cranes, bulldozers and cement trucks working on construction sites around the province aren’t going away any time soon, according to data released this morning from Statistics Canada.
Municipalities throughout Alberta issued a total of $1.71 billion in building permits in July, essentially unchanged from June. The figure is adjusted for seasonality. The all-time record for the province was set in May 2007 with $1.84 billion in building permits issued. Since then, the total has exceeded $1.7 billion only three times—two of those times being in June and July of this summer.
Building permits are a good sign of future activity—what economists call “leading indicators”—because permits must be secured in advance of any construction activity taking place. Residential permits were up 9 per cent from June to $933 million. Over the last twelve months, residential permits are 15 per cent compared to the previous twelve month period. That reflects solid income and labour markets, a growing population and plenty of demand for new houses and condos.
Non-residential permits slipped to $780 million in July, essentially offsetting the increase in residential permits. However even with this dip, non-residential building activity is certain to remain a strong driver of the economy in 2015. Institutional and government building projects—largely made up of transportation infrastructure, schools, and hospitals—more than doubled in July to $143 million. Commercial projects fell a bit while industrial projects were unchanged.
**Article courtesy of Todd Hirsch, Chief Economist at ATB Financial. Thanks Todd!!
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