Canadian construction permits in November recorded the sharpest drop in 19 months as builders scaled back plans for industrial facilities and condominiums.
The value of permits granted by municipal governments fell 17.9 percent to C$6.2 billion ($6.29 billion), the lowest level since January 2012, after a revised 15.9 percent gain in October, Statistics Canada said today in Ottawa. Economists forecast a 5 percent drop, according to the median of 9 responses to a Bloomberg survey.
Finance Minister Jim Flaherty and the country’s banking regulator tightened lending rules last year as consumer debts reached record levels amid signs of overbuilding in cities such as Vancouver and Toronto.
Homeowners have taken advantage of low mortgage rates as Bank of Canada Governor Mark Carney has kept his key policy rate at 1 percent for more than two years, the longest pause since the 1950s.
Residential permits declined 6.8 percent to C$3.77 billion in November, as the value of multiple-unit projects decreased 10.8 percent and single-family permits dropped 4 percent.
Non-residential construction permits fell 30.6 percent to C$2.43 billion, as industrial projects such as factories recorded a 60.7 percent drop. Industrial construction permits more than tripled in the prior month.
Permits for institutional projects such as schools dropped 49.1 percent, while commercial projects such as offices rose 5.9 percent, the statistics agency said.
The value of permits was 0.2 percent higher in November than the same month a year earlier.
In a separate report, Statistics Canada said its new-home price index rose 0.1 percent in November and 2.2 percent from a year earlier. Toronto, the country’s biggest market, recorded a 0.3 percent gain on the month.
Economists surveyed forecast a 0.2 percent increase in new home prices for November, according to the median of 9 estimates.