indicatorThe Twenty-Four

Building momentum

Residential construction in Alberta

By Rob Roach, ATB Economics 12 June 2024 2 min read

After pulling back in February and March, construction intentions in Alberta grew by 9.4% in April to reach $1.62 billion.*

The direction of the trend is clearer when we look at the year-to-date (YTD) numbers: the value of building permits issued over the first four months of 2024 was 28% higher than over the same period in 2023.

Residential construction has been driving the growth so far in 2024; YTD permits were up 44% compared to just 0.3% in the non-residential sector.

Breaking it down further, the YTD value of permits issued for both single-detached houses (+36%) and multi-dwelling projects increased (+53%).

The strong residential numbers reflect the population growth Alberta has been experiencing and drum-tight supply levels in the resale market.

Although last week’s interest rate cut by the Bank of Canada was only conjecture in April, builders may have been anticipating lower borrowing costs and submitting more permits as a result.

In the non-residential sector, YTD permit value for institutional and governmental building projects was up by 24% and by 7% for industrial buildings.

Despite growth on a month-over-month basis, the YTD permit value of commercial buildings was down by 6% over the first four months of the year.

YTD growth has been particularly strong in the Edmonton Census Metropolitan Area (CMA) and the Lethbridge CMA.

Led by an 81% rise in multi-dwelling permit value, Edmonton posted YTD growth across all residential and non-residential categories for an overall increase of 52%.

A 470% spike in multi-dwelling permit value in Lethbridge lifted the total value of permits by 50%.

In the Calgary CMA, single-detached (+40% YTD) growth outpaced multi-dwelling projects (+29% YTD) while non-residential permit value saw a YTD decline of 15%.

Due to an unusual spike in the value of its single dwelling building permits in April of last year, Red Deer was the only CMA in Alberta to see a drop in residential permit value. Even a 328% surge in multi-unit permits was not enough to offset the YTD drop in the single dwelling category.

With the housing market still playing catch-up with Alberta’s population growth, we expect residential permit value to continue to post strong numbers this year and play a key role in driving overall economic growth in the province.

*The data in today’s Owl have been adjusted to account for regular seasonal patterns.

Answer to the previous trivia question: The House of Commons designated June as National Aboriginal History Month in 2009. The name was changed to National Indigenous History Month in 2017.

Today’s trivia question: Where in Alberta once stood one of the two buildings in Canada designed by Frank Lloyd Wright?

The value of building permits issued by Alberta municipalities over the first four months of 2024 was 27.9% higher than over the same period in 2023

The value of building permits issued by Alberta municipalities over the first four months of 2024 was 27.9% higher than over the same period in 2023

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