May 7, 2024 – Both residential and non-residential building construction costs increased 0.8% in the first quarter of 2024, reports Statistics Canada.

That’s a 1.1% increase from the previous quarter for the residential sector, and a 0.8% increase for the non-residential sector.

This marks the slowest quarterly growth in residential building construction costs since the Q2 2020, Statistics Canada notes, and the slowest quarterly growth in non-residential building construction costs since Q4 2020.

Year over year, construction costs for residential buildings rose 5.2% in Q1 2024 in the 11-census metropolitan area (CMA) composite, while non-residential building construction costs saw an increase of 4.6%.

Halifax (+8.1%) led the year-over-year growth in construction costs for residential buildings, while Moncton (+7.9%) 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, says Statistics Canada.

Atlantic and Prairie provinces suffer largest increases in residential construction costs

In Q1 2024, Halifax (+1.8%) and Calgary (+1.8%) experienced the largest quarterly increases. Ottawa (+0.1%) experienced the smallest increase in residential construction costs throughout the quarter.

In the 11-CMA composite, the cost to build single-detached houses (+1.0%) recorded the most pressure of all residential buildings in scope for the survey, followed by townhouses (+0.8%).

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

Rising general requirement and concrete costs lead non-residential increase

Costs to construct non-residential buildings increased the most in Saskatoon (+1.8%) in the first quarter, followed by Moncton (+ 1.1%).

Of all non-residential buildings surveyed, the cost to build a factory (+1.0%) rose the most in the 11-CMA composite in Q1 2024; warehouses (+0.9%) were not far behind.

Overall, non-residential building construction costs increased across all but two divisions measured. General requirements, concrete, conveying equipment, and equipment each rose 1.1%, while electrical (-0.3%) and integrated automation (-0.1%) experienced cost declines.