Home builders have been burdened with mounting material and labor costs. The Statistics Canada building construction price index saw a record jump in this year's second fiscal quarter.
Residential costs rose by 7.5 per cent in the second quarter alone - a pretty substantial jump from the 4.9 per cent increase seen in this year's first quarter. Statistics Canada said it was the most sizable increase in construction costs in the history of the index. Although the index only dates back to 2017, it's highly likely that it is the most substantial rise seen in decades.
Canadian Residential Building Construction Cost Growth (annual)
Source: Stat Can
Annually speaking, residential housing constructions costs skyrocketed. Stat Can figures national annual growth reached 18.8 per cent in this year's second quarter. Costs rose the quickest in Calgary with a 31.4 per cent increase, Ottawa with 28.5 per cent and Toronto and Edmonton both saw increases of 22.4 per cent.
Non-residential building prices jumped 3.7 per cent in this year's second quarter, and a 5.7 per cent increase from last year. Just over half of the past year's increase was seen in the second fiscal quarter.
Canadian Non-Residential Building Construction Growth (annual)
Percent
Source: Stat Can
Larger cities also saw rapid rises for non-residential construction. Costs increased the quickest in Ottawa at 10.1 per cent, Montreal with 8.4 per cent and Toronto at 7.7 per cent. Interestingly, Vancouver at 3.2 per cent, was under the national rate.
This year's second fiscal quarter was quite volatile in regards to construction - it began with commodities like lumber seeing its most aggressive growth on record and ended with a significant cool down.