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64-001-XIE
The purpose of the monthly survey of building permits
issued by Canadian municipalities is to collect data on construction intentions.
The results of this survey are used by C.M.H.C. (Canada
Mortgage and Housing Corporation) as a reference
base for conducting a monthly survey of housing starts and completions
in accordance with its mandate. The statistics on building permits are
also essential for the computation of capital expenditures. Furthermore,
since the issuance of a building permit is one of the first steps in the
construction process, these statistics are widely used as a leading indicator
of building activity.
The Building Permits Survey covers all Canadian municipalities
that issue permits. The number of Canadian municipalities currently surveyed
exceeds 2,500, representing all the provinces and territories. They account
for 94% of the Canadian population. Participation to the survey is mandatory; the survey does not use a predetermined sample of municipalities.
In practice, all urban agglomerations are represented in the survey, as
well as a fair percentage of rural municipalities. With certain exceptions,
the minimum coverage corresponds to the municipalities already included
in the Housing Starts and Completions C.M.H.C.’s Survey. Non-responding
municipalities that issue permits are urged on a regular basis to respond
to the Building Permit Survey. Therefore, the number of municipalities
covered is increasing continually.
The survey is usually conducted by mail, although certain
municipalities choose to respond by telephone. The municipal officer responsible
for issuing permits is asked to fill out a form
each month describing all major construction projects.
The value of the permits reported includes the following expenditures:
materials, labour, profit and overhead. The cost of land is never included
in the estimated value of the permit while acquisition costs (legal fees,
surveying fees and accrued interest) may be included at times.
The municipalities forward a copy of their completed report
to Statistics Canada Head Office and another copy to the local office
of the Canada Mortgage and Housing Corporation (C.M.H.C.). To reduce their
overhead, an increasing number of respondents are producing a computerized
report.
Reports from municipalities which one part of a census
metropolitan area or a census agglomeration must be received within 20
days following the month of reference. The other municipalities have 30
days to produce their reports. Only those municipalities that are late
in reporting and that are included in the above-mentioned C.M.H.C. survey
are subject to follow-up by telephone.
The reports received at Statistics Canada Head Office
are verified, coded and processed.
Since the building permit data are extracted from municipal
administrative documents, two types of response errors are possible: errors
attributable to the permit applicant and errors in transcription by the
responding municipality. However, experience has shown that transcription
errors are not very common and the increasing number of municipalities
producing computerized reports tends to reduce the frequency of this type
of error. Errors attributable to a false statement of the cost of construction
are more probable. A qualitative survey conducted among major Canadian
municipalities has revealed an underestimation of the declared value of
buildings for which permits are issued. Since permit fees are in most
cases based on the value of the construction, this leads unquestionably
to under-estimation of project values. The results of that survey also
reveal that, in half of the municipalities covered, the value submitted
by the applicant is not subject to any verification by municipal officers.
Strict quality control procedures are applied to ensure
that collection, coding and data processing are as accurate as possible.
In addition to the usual checks to ensure that the forms are fully completed,
quality control procedures established by the Business Survey Methods
Division are applied to the coded and processed data. Checks are also
performed on totals and the magnitude of data. Reports that fail to meet
the quality standards are subject to verification and are corrected as
required.
Imputations are required for each characteristic for which no report has been received. These are calculated automatically, subject to certain constraints, by applying to previously used values, the month-to-month and year-to-year changes in similar values of responding municipalities and the historical pattern of the missing municipalities. No imputation is done for lack of coverage, concealment
or the underevaluation of permits issued. For this reason, the sampling
error cannot be computed.
Comparison of data must be done with reservation considering that the
methods of issuing permits and the methods of estimating building values
can differ from one municipality to another. Also, comparisons involving
different periods must take into account the constant increase in the
number of municipalities participating in the survey.
The monthly statistics are not corrected for cancelled or expired permits.
According to the municipal officers, the proportion of cancelled and unused
permits is below 5%.
The classification used in this publication deals strictly
with structures for which a building permit was issued. Permits are
generally issued for the following: construction of new buildings, alterations,
additions, renovations, etc. Minor repair jobs such as painting, tiling,
roofing, etc., for which no permit is required, and engineering work (such
as dams, roads, pipelines, etc.), which, by definition, is not a building,
are not included in the building permit series. Estimates of such work may
be obtained from the publications Capital expenditures by type of asset
(cat. no. 61-223) and Private
and Public Investment in Canada Intentions (cat. no. 61-205).
The description given by the municipalities as to the type of building
(box #6 of Section A on the form) and the type of work involved
(box #7 of Section A on the form) forms the basis for classification.
The classification of buildings into major groups and subgroups is based
on the following: intended use in the case of new buildings; present or
intended use of buildings to which improvements are to be made; present
use of the existing structure where the proposed construction is intended
to provide additional facilities; principal use of the structure where
the proposed construction has more than one intended use; however, where
the building contains dwellings, the value of the construction is divided
between residential and non-residential use.
Territorial boundaries were established according to the
1996 Census definitions. Changes in boundaries, status or name of census
subdivisions between censuses are introduced in this publication on a
yearly basis. Changes affecting the other geographic units (CMAs, CAs,
CDs and ERs) are introduced every five years, eighteen months following
the census.
Two types of revisions can affect the results of the Building
Permits Survey:
Seasonally adjusted data for the total number of housing
units as well as for the aggregate value of building permits are obtained
indirectly, i.e., by adding their seasonally adjusted components. The
total number of dwelling units is obtained by summing the seasonally adjusted
data for single-family and multiple-use units; the total value of building
permits is obtained by summing the following elements: residential, industrial,
commercial and institutional. Some series contain no apparent seasonality.
In these cases, unadjusted values have been tabulated and agregated to
the adjusted values of the other series. At the end of the year, the chronological
series adjusted for seasonality are revised to take into account the most
recent seasonal fluctuations. These revisions apply only to the last three
years in the series. The revised data are introduced into the CANSIM databank.
This publication contains only part of the data produced
on building permits. However, you may order unpublished tables or address
special requests, now available on diskette, to the Current Investment
Indicators Section ((613) 951-9689, call collect). The series presented
here is also available on CANSIM in matrices 80
(levels 3-7,16-32), 129,
137, 443,
987, 989-995,
and 4073.
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