After Years of Strong Growth, Canadian Markets Cool
After four years of near double-digit growth, the Canadian construction industry is expected to take a step back in 2008 as the value of new building permits falls 7%, to $66 billion Canadian dollars, according to a forecast by McGraw-Hill Construction Research and Analytics, Bedford, Mass. However, unlike the U.S. markets, the slowdown in Canadian construction will be led by a 16% decline in commercial work and a 7% decline in industrial construction. Residential permits are expected to only slip 4% in 2008, after increasing 5% this year.
Rising mortgage rates will put the brakes on nine years of growth in the housing market. Within the residential construction sector, multifamily housing will see the larger decline. After a 7% increase in 2007, multifamily housing will decline by a comparable 7% in 2008, to $14 billion. Single-family housing, by contrast, will decline by a more modest 2% in 2008, after a 3% gain in 2007.