In: ConstructionNews

The Q1 Royal Institution of Chartered Surveyors (RICS) and Canadian Institute of Quantity Surveyors (CIQS) Construction Monitor results have revealed an improvement for the Canadian market, with growth seen across both the private residential and non-residential sectors.

According to the results, expectations for the next twelve months also look promising, with increases in sentiment across the board. However, the sector still has its challenges, with skills and labour shortages still seen as a real issue for the industry.

Beginning with the Construction Activity Index (CAI), a survey indicator which picks up on the general picture of activity across the sector, net balance has improved from +12 in Q4 2023, to +24 in Q1.

In terms of results on a regional level, the strongest increase was registered in the Prairie Provinces, where the CAI increased to +50 from a reading of +36 previously. British Columbia also saw a noticeable improvement, as the CAI picked up to +21 from +8 previously.

When delving into the workload sub-sectors, the results noted the rise in the net balance for the private residential sector which increased from -10 in Q4 to +18 this time. A net balance of +7 per cent of respondents also cited an increased in private non-residential workloads in Q1, up from a slightly negative reading of -3 last time round.

While infrastructure remains the strongest performing sub-sector in terms of net balance, the latest reading of +24 is more modest than the recent high of +41 recorded back in Q2 2023.

“According to a report issued by CMHC in September of 2023, close to 3.5 million housing units need to be built by 2030 for Canada ‘to restore affordability,” said Sheila Lennon, CEO of CIQS. “It is therefore encouraging to learn that the net balance increase in private residential construction rose to +18 per cent in Q1 2024, up from -10% in Q4 2023.  This positive outlook on residential construction echoes a Bank of Canada press release from April 10, 2024 which stated that the Canadian economy has seen growth as of late and “residential investment is strengthening.”

While skills and general labour shortages remain widely referenced factors seen as holding back market activity, the cost of materials also remains a significant issue, with 68 per cent of contributors singling it out.

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