Construction Loans in Demand as Building Permit Requests Rise

The need for construction loans may be on the rise again, as the total value of building permits begins to rise. This despite “a substantial decline in the residential sector”, led by a decline in demand for building permits for multiple-family dwellings.

“Statistics Canada recently released a summary report on building permits, which showed that contractors took out $6.6 billion in building permits in May of this year, which indicates a 1.1% increase in building permits requested from April.

“StatsCan’s numbers indicate that demand for non-residential, industrial adn institutional building permits led the increased demand for construction approvals. While overall demand for residential permits fell, this was due to a big drop in demand for multi-family residential permits. With single-family dwellings, Statistics Canada reported that following two months of declines, “the value of single-family permits edged up 0.5% in May to $2.2 billion.”

“Overall it looks as if there will be an increase in demand for construction loans from Canadian lenders. This marked “the first back-to-back increase in construction intentions since November 2006, and could point to busy construction sites in the coming months. The value of building permits has followed an upward trend since the beginning of the year,” according to StatsCan