Building construction investment rises again
The level of building construction investment rose in December, in the fourth quarter of last year, and across 2021 as a whole.
Statistics Canada’s latest look at the metric shows an overall jump in investment of 1.9 percent for December to $18.4 billion. The monthly increase was spurred by gains of 2.2 percent in the residential sector and 1.1 percent in the non-residential sector.
Single-family home investment rose 3.5% to $7.4 billion with increases posted in eight provinces. Multi-unit construction investment, meanwhile, increased by 0.7% to $6.1 billion.
Total residential sector investment ended the month at $13.4 billion, and Ontario accounted for more than half of December’s monthly increase.
In the non-residential sector, commercial investment rose by 1.7% to $2.7 billion, while industrial investment increased by 1.6% to $842 million. The institutional sector meanwhile, posted its first decline in more than a year.
Non-residential investment reports best quarter in four years
On the strength of several strong months, Statistics Canada is reporting that the total value of investment in building construction increased by 1.8% to $54.2 billion in the fourth quarter.
Investment in non-residential construction was particularly strong, rising 4.1% to $14.7 billion. This represented the largest quarterly increase since the third quarter of 2017. Gains were led by the commercial component (+4.9%), which posted its fourth consecutive quarterly increase. Institutional (+4.2%) and industrial components (+1.2%) showed strength as well.
Investment in residential construction rose by a much more modest 1.0% compared with the third quarter, with most of the growth coming from Ontario. Single-unit investment was up 1.4% with increases in eight provinces, while multi-unit investment edged up 0.5%.
Record year in ‘21
Overall, investment in building construction saw a record year in 2021. Investment jumped by 19.3 percent to $218.2 billion. That figure, however, does not adjust for the high rates of inflation seen in construction material prices recently. Adjusted on a constant dollar basis, investment in building construction in 2021 advanced by a more moderate 3%.
Investment in residential construction rose 28.4% to $162.0 billion, with single-unit investment accounting for more than half of the gain. Similarly, Canada Mortgage and Housing Corporation reported a 20% jump in construction starts from 2020.
Despite a strong fourth quarter, investment in non-residential construction saw a slight decrease of 0.9% to $56.2 billion in 2021. The decrease reported by commercial (-5.4%) and industrial (-3.4%) construction was somewhat offset by growth in institutional investment (up 12.0% to $15.2 billion).