Building construction costs continue slow quarterly growth

Residential building construction costs increased 0.8 percent in the first quarter, following a 1.1 percent increase in the previous quarter, says Statistics Canada. This marks the slowest quarterly growth in residential building construction costs since the second quarter of 2020.

Non-residential building construction costs also rose 0.8 percent in the first quarter, following a 0.8 percent increase in the previous quarter. This also marks the slowest quarterly growth in non-residential building construction costs since the fourth quarter of 2020.

Year over year, construction costs for residential buildings rose 5.2 percent in the first quarter of 2024 in the 11-census metropolitan area (CMA) composite, while non-residential building construction costs saw a slightly more modest increase of 4.6 percent. Halifax, NS, (+8.1 percent) led the year-over-year growth in construction costs for residential buildings, while Moncton, NB, (+7.9 percent) led the growth of non-residential buildings.

Skilled labour shortages and the resulting increases in labour rates, availability of materials, interest rate pressure, and building codes updates were all reported as key factors impacting the construction sector.

In overall residential building construction divisions, masonry (+2.3 percent) and earthworks (+2.3 percent) noted the largest quarterly increases in the first quarter. Conveying equipment (-0.3 percent) and electrical (-0.1 percent) were the only two divisions to experience quarterly price declines.