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Building construction price indexes, third quarter 2018

Released: 2018-11-15

Contractor prices for the construction of new non-residential buildings (+1.5%) increased more than prices for new residential buildings (+0.8%) in the third quarter.

The rise in the cost of both non-residential and residential building construction was attributable to higher prices for steel and metal products, both affected by the tariffs imposed in June 2018. According to the Industrial Product Price Index, prices for primary ferrous metal products rose 14.3% from January 2018 to September 2018.

Chart 1  Chart 1: Building construction price indexes, quarter-to-quarter change
Building construction price indexes, quarter-to-quarter change

Non-residential buildings, quarterly change

Increases in contractor prices were observed for all types of new non-residential buildings and in all 11 surveyed census metropolitan areas (CMAs). Prices rose the most in Ottawa (+2.5%), Vancouver (+1.8%) and Montréal (+1.7%).

Nationally, contractor prices for the construction of factory buildings and warehouses (+1.9% for both) rose the most. These increases were mainly due to the higher cost of metal fabrication, which is an important component in the construction of both building types. Structural steel products also pushed up the construction costs of factory buildings.

At the CMA level, contractor prices for the construction of factory buildings (+3.1%) and warehouses (+3.0%) were the highest in Ottawa, followed by Vancouver and Montréal.

Non-residential buildings, 12-month change

Prices for the construction of new non-residential buildings were up 4.3% over the 12-month period ending in the third quarter. The gain was mostly due to higher construction costs in Ottawa (+6.3%) and Vancouver (+5.8%).

Residential buildings, quarterly change

Construction costs rose for all types of residential buildings and in all CMAs covered by the survey. The largest gains were in Ottawa (+1.5%), followed by St. John's (+1.2%) and Halifax (+1.1%).

The increases were mostly driven by higher prices for the construction of apartment buildings (+0.9%). The largest gain was in Ottawa, where the cost of apartment building construction increased 1.8%, largely due to higher prices for metal fabrication products.

Ottawa also led the price gain for the construction of single-detached houses (+1.5%) and townhouses (+1.4%), followed by St. John's and Halifax.

Residential buildings, 12-month change

Prices charged by contractors for new residential building construction were up 6.0% over the 12-month period ending in the third quarter. Prices rose the most in Winnipeg (+10.2%) and Toronto (+7.2%).


  Note to readers

The building construction price indexes (BCPI) are quarterly series that measure change over time in the prices that contractors charge to construct a range of new commercial, institutional, industrial and residential buildings in 11 census metropolitan areas: St. John's, Halifax, Moncton, Montréal, Ottawa–Gatineau (Ontario part), Toronto, Winnipeg, Saskatoon, Calgary, Edmonton and Vancouver.

These buildings include six non-residential structures: an office building; a warehouse; a shopping centre; a factory; a school; and a bus depot with maintenance and repair facilities. In addition, indexes are produced for five residential structures, including a bungalow, a two storey house, a townhouse, a high rise apartment building (five storeys or more) and a low rise apartment building (less than five storeys).

The contractor's price reflects the value of all materials, labour, equipment, overhead and profit to construct a new building. It excludes value added taxes and any costs for land, land assembly, building design, land development and real estate fees.

With each release, data for the previous quarter may have been revised. The index is not seasonally adjusted.

A Historical Timeline of Canadian Producer Price Statistics

"A Historical Timeline of Canadian Producer Price Statistics," which is part of the Prices Analytical Series (Catalogue number62F0014M), was created to showcase the key milestones in the history of Canadian producer price statistics. This historical timeline contains answers to questions such as: Who collected Canada's first statistics? What do Canadian producer price indexes measure?

Infographic: Producer Price Indexes at a Glance

The infographic "Producer Price Indexes at a Glance," which is part of Statistics Canada — Infographics (Catalogue number11-627-M) demonstrates how producer price indexes for goods and services are calculated and why they are important for the Canadian economy.

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).

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