St. Albert’s building permit reports show the city is underperforming in traditionally strong areas and exceeding in weaker ones.
In the first five months of 2016, the city sold 42 single-family home permits – 20 less than this time last year.
“If you were to check anywhere I think you’ll find that’s what happened. With the economy being the way it is, it’s really slowed down,” said Guy Boston, executive director of St. Albert’s Economic Development department.
According to a Statistics Canada report, Alberta’s residential housing construction dropped 16 per cent to $4 billion in the first quarter of 2016, mainly due to lower investment and prices in the single-family dwelling market.
Canada Mortgage and Housing Corporation predicted last month that single- family home starts will further decline in the province, before slightly rebounding in 2017.
In the Edmonton region, total housing starts are expected to drop from 17,050 (in 2015) to between 8,600 and 9,600 units in 2016.
Christina Butchard, CMHC’s principal market analyst for Edmonton, indicated that elevated inventory in both the single family and multi-family segments contributed to the 33-per-cent decrease in year-over-year construction.
“The slow pace of housing starts is expected to continue through the remaining months of 2016 as slower employment growth, reduced migration and competition from the resale market moderate demand for new homes,” she said.
Year-to-date numbers from the CMHC show starts mirror the trend in building permit sales, with 22 fewer single family homes under construction than this time last year (45 compared to 67).
Boston said many developers are no longer building on speculation, and many are trying to sell showhomes before undertaking new construction.
Single-family home permit sales in St. Albert picked up a bit in May. Twelve new units resulted in a $5.8 million boost last month alone. But overall the lagging single-family market has cost the city over $8.9 million in residential investment compared to this time last year.
A new 164-unit apartment complex worth $26.3 million, as well as a number of multi-family homes helped bolster the city’s numbers. Total real estate investment as of the end of May is over $63 million, compared to 42 million this time last year.
The city posted some healthy numbers in the commercial industrial category.
This time last year there were no new commercial industrial investments. Since the end of May the city boasts three – a new office building on Chisholm Avenue, a new multi-tenant building on Carleton Drive and most notably the new Alberta Gaming and Liquor Commission warehouse on Campbell Road.
The distribution centre, currently under construction, brings $67.8 million worth of investment to the city and consolidates 400 jobs
“We fought real hard to keep (them) here,” said Boston. “They weren’t going to move the warehouse they already have, but the new one that they’re building could have been anywhere else. That’s the success story we’ve got about working really hard with a whale, if you will, to keep them in St. Albert.”
