The latest data on building construction investments shows a slight downturn in November 2024, following a similar drop the previous month. Despite the decrease, the non-residential sector achieved a historic milestone, setting a record high for the industry.
According to Statistics Canada, total investment in building construction for November 2024 reached $21.4 billion, marking a 0.5% decrease or a $96.6 million dip compared to October. This follows a 1.1% drop in October, signaling a slowdown in the industry. However, the year-over-year trend paints a more optimistic picture, with a 2.7% increase in building construction investment compared to November 2023.
The primary driver of the decline was the residential sector, which saw a $168.1 million decrease, bringing its total investment to $14.8 billion. This represents a 1.1% drop compared to October, with Ontario bearing the brunt of the losses. The province recorded a significant reduction of $227.8 million in residential construction investment.
Notably, the multi-unit dwelling segment experienced a sharp 4.8% decline, falling by $374.4 million to $7.5 billion in November. Ontario’s contribution to this downturn was substantial, with a $317.9 million reduction. The setback in multi-unit dwellings was widespread, with five other provinces and two territories also reporting decreases.
In contrast, single-family home construction provided some relief for the residential sector. Investment in single-family homes rose by 2.9% or $206.4 million, reaching a total of $7.3 billion. Ontario led the national increase, contributing $90.0 million to this growth, while eight provinces experienced gains in this category.
While the residential sector struggled, the non-residential building construction sector posted strong results. Total investment in this area climbed 1.1%, or $71.5 million, reaching a record-breaking $6.6 billion. This marks the fourth consecutive month of increases for the non-residential sector, a promising sign of resilience.
The industrial component of non-residential construction was a key contributor, rising by 2.2% or $30.7 million to $1.4 billion. Meanwhile, the commercial construction segment saw modest growth of 0.4%, with a $12.8 million increase, bringing its total to $3.3 billion. Ontario’s investment in commercial construction rose by $25.0 million, offsetting losses in Alberta and British Columbia.
The institutional construction category also experienced a boost in November, with a 1.5% rise or $27.9 million, bringing the total to $1.9 billion. Six provinces and all three territories saw increases in institutional investments, with Quebec being the lone exception, experiencing a slight decline of $1.7 million.
While the decline in residential construction investment raises concerns, the strong performance of the non-residential sector offers a promising outlook for the building industry in Canada. The continued growth in industrial and institutional investments suggests a broader diversification of the market, which could help stabilize the industry in the face of residential setbacks.