Building permit values dropped by 6.5% in September, after the institutional component stepped down from a record August.

Statistics Canada’s latest look at the data finds permit values at $11.2 billion for the month, as growth in the residential sector was not enough to offset a loss in non-residential activity.

The total monthly value of residential permits increased 4.3% to $7.2 billion, led by a 37.2% monthly increase in construction intentions in British Columbia. Combined, residential permits issued in Vancouver, Kelowna and Victoria made up 77.3% of the value of residential permits, and just under 80% of the number of new dwellings authorized in the province in September.

Monthly gains in the value of residential permits in Newfoundland and Labrador (+20.8%; +$6.0 million), Prince Edward Island (+16.2%; +$4.8 million), Nova Scotia (+10.3%; +$18.5 million), and Quebec (+9.1%; +$105.2 million) offset the declines in the remaining five provinces.

Municipalities authorized 21,700 new dwelling units in September, 5.6% more than August 2023 and 2.3% more than September 2022.

Meanwhile, the total monthly value of non-residential permits fell 21.0% from August to $4.0 billion in September.

The drop was directly tied to a decline in the institutional component, which dropped just short of 51% to $1 billion, after recording a record high of $2.1 billion in August when municipalities issued permits for several high-value projects.

Despite the sharp decline, the total value of non-residential building permits in September ($4.0 billion) was 19% higher than in September 2022 ($3.4 billion). Construction intentions in the non-residential sector have been steadily trending upwards over the course of the past 12 months.

Q3 results higher in both components

The total value of building permits in the third quarter of 2023 rose 4.9% from the second quarter to $34.6 billion. The residential sector increased 3.4% to $21.2 billion, while the non-residential sector was up 7.3% to $13.5 billion.

All three non-residential components posted quarterly gains in the value of permits, with the institutional component rising 13.8% to a new quarterly record high of $4.5 billion. This was the fourth consecutive quarterly increase for the institutional component.

In the residential sector, 64,400 new units were authorized through building permits in the third quarter of 2023.

Specifically, 13,600 new single-family homes were authorized, 12.1% higher than the 12,200 authorized in the second quarter. This increase follows six consecutive quarterly declines in construction intentions for the single-family home component. Peterborough (+151.2% with 90 new units) recorded the largest growth rate in the number of new single-family homes planned.