Dedicated locality research platform
Enter your email address and you will receive
a link to reset your password
Canadian construction costs have been on a steady incline since the onset of the pandemic, with various elements contributing to this trend. A recent study from RBC has highlighted that the residential construction price index in the country has risen 51 per cent compared to pre-pandemic figures, throwing a wrench into Canada's plans to achieve its housing objectives.
According to the report, prime building materials, including steel and concrete, have experienced a price surge of over 50 per cent since the pandemic began. This increase is largely due to extreme weather conditions and factory closures that have put a strain on supplies and caused a surge in prices.
However, the rise in construction costs is not solely due to expensive materials. The study indicates that municipal development fees have also seen a yearly surge of up to 30 per cent in various regions of Canada.
The RBC report also points to a significant labour shortage in the industry, causing wage growth in construction to outpace other sectors at 9.4 per cent in 2022. This workforce imbalance is another crucial factor inflating the overall cost of construction.
The burgeoning cost pressures are already being felt in the construction sector. Recent data from the Canada Mortgage and Housing Corporation show a 23 per cent drop in new housing projects in May, with Vancouver and Montreal recording 45 and 35 per cent declines, respectively.
This situation comes as Canada witnesses record immigration numbers and an intensifying housing crisis. In the first quarter of 2023, Statistics Canada noted that the country saw an influx of 292,232 newcomers, primarily immigrants. Moreover, Canada's population grew by over one million in 2022 alone, the first time such a number has been recorded in a year.
Efforts to boost construction have been a key part of Canada's strategy to improve housing affordability. In 2022, the CMHC stated that 5.8 million new homes would need to be built by 2030 to make housing affordable for all Canadians.
In the 2023 federal budget, the government announced a $4 billion housing acceleration plan with the target of constructing 100,000 new homes annually over the next five years. However, provincial plans have set even more ambitious targets.
In conclusion, as Canada continues to grapple with record immigration and a booming population, the escalating construction costs due to material pricing, climate-related disruptions, and labour shortages pose a significant challenge to the nation's housing affordability plans. Thus, a robust response from all levels of government is needed to alleviate the housing crunch and build a sustainable future.
Propscience is India’s dedicated property news portal. We cover the latest events, news, trends, deals, new launches and more.
All our services and tools are completely free of cost and available 24X7!
We use cookies to give you the best possible service while using our website, please click accept and carry on browsing if you're happy with this. For more information see our Privacy Policy.
Okay, Got it!This disclaimer ("Disclaimer") is applicable to the entire Site. Upon entering the Site it is recommended that you immediately read the Terms and Conditions and Privacy Policy listed therein. Your continued usage of this Site will indicate your unconditional acceptance of the said Terms and Conditions and Privacy Policy. You hereby agree that Propscience reserves the right to modify at any time, the Terms and Conditions and Privacy Policy governing this Site without prior notification. Your usage of the Site implies that you will be bound by any such modification. You agree and acknowledge that it is your responsibility to periodically visit the Site and stay updated with the Terms and Conditions and Privacy Policy of the Website.
The information contained in this Site has been provided by Propscience for information purposes only. This information does not constitute legal, professional or commercial advice. Communication, content and material within the Site may include photographs and conceptual representations of projects under development. All computer-generated images shown on the Site are only indicative of actual designs and are sourced from third party sites.
The information on this Site may contain certain technical inaccuracies and typographical errors. Any errors or omissions brought to the attention of Propscience will be corrected as soon as possible. The content of this Site is being constantly modified to meet the terms, stipulations and recommendations of the Real Estate Regulation Act, 2016 ("RERA") and rules made thereunder and may vary from the content available as of date. All content may be updated from time to time and may at times be out of date. Propscience accepts no responsibility for keeping the information in this website up to date or any liability whatsoever for any failure to do so.
While every care has been taken to ensure that the content is useful, reliable and accurate, all content and information on the Site is provided on an "as is" and "as available" basis. Propscience does not accept any responsibility or liability with regard to the content, accuracy, legality and reliability of the information provided herein, or, for any loss or damage caused arising directly or indirectly in connection with reliance on the use of such information. No information given under this Site creates a warranty or expands the scope of any warranty that cannot be disclaimed under applicable law.
This Site provides links to other websites owned by third parties. Any reference or mention to third party websites, projects or services is for purely informational purposes only. This information does not constitute either an endorsement or a recommendation. Propscience accepts no responsibility for the content, reliability and information provided on these third-party websites. Propscience will not be held liable for any personal information of data collected by these third parties or for any virus or destructive properties that may be present on these third-party sites.
Your use of the Site is solely at your own risk. You agree and acknowledge that you are solely responsible for any action you take based upon this content and that Propscience is not liable for the same. All details regarding a project/property provided on this Site are updated on the basis of information available from the respective developers/owners/promoters. All such information will not be construed as an advertisement. To find out more about a project / development, please register/contact us to visit the site you are interested in. All decisions taken by you in this regard will be taken independently and Propscience will not be liable for any such loss in connection with the same. This Site is for guidance only. Your use of this Site - including any suggestions set out in the Site and or any use of the resources available on this Site, do not create any professional - client relationship between you and Propscience. Propscience cannot accept you as a client until certain formalities and requirements are met.
We use cookies to give you the best possible service while using our website, please accept it and continue browsing if you're happy with this. For more information see our Privacy Policy