The value of Canadian building permits dropped to $6.1 billion in November as plans to build in residences across the country were more than offset by a dropoff in everything else.
The value of permits declined 3.6 per cent compared to the previous month, of October, which itself saw a jump of 11.6 per cent over the previous month, Statistics Canada reported Monday.
Building permits are considered a leading indicator of the economy because they signal investment to come. They tend to lead to spending on materials and labour down the line, and they're a sign of people having enough optimism in their economic future.
16,895 new homes OK'd
Contractors took out permits for $3.9 billion worth of residential construction during the month, a 6.9 per cent increase after three months of declines. The advance was attributable to higher construction intentions in eight provinces, led by British Columbia, Ontario and Nova Scotia.
But those gains were more than offset by a 17.6 per cent decline in non-residential permits, to $2.2 billion. The drop came after a 31.9 per cent increase the previous month.
Non-residential construction intentions declined in six provinces, with Ontario, Newfoundland and Labrador and Alberta accounting for most of the drop. All three components of the non-residential sector (instituional permits, municipalities and commercial building intentions) declined.
In the residential sector, building intentions were up both in single-family homes (up 8.2 per cent to $2.4 billion) and multi-unit dwellings such as condos, where they were up five per cent to $1.5 billion.
Nationally, municipalities approved the construction of 16,895 new dwellings, up 5.8 per cent from October. The increase came from both single-family dwellings, which increased 6.2 per cent to 7,199 units, and multi-family dwellings, which rose 5.5 per cent to 9,696 units.