Brian Morton
Sun
Apartment construction costs are going up across Canada, with Vancouver leading the way, Statistics Canada reported Monday.
“Labour costs are rising because of the competition and demand,” said Peter Simpson, CEO of the Greater Vancouver Home Builders Association. “And steel prices were up dramatically, but it seems to have flattened out.”
The Statistics Canada report noted that the composite price index for apartment building construction rose 6.4 per cent in Canada‘s leading cities from the first quarter of 2004 to the first quarter of 2005.
In Vancouver, the price index rose 7.7 per cent from the first quarter of 2004 compared to the first quarter of 2005.
The report noted that Edmonton recorded the highest quarterly change [+0.9 per cent] from the fourth quarter of 2004 to the first quarter of 2005, followed by Calgary [+0.6 per cent] and Vancouver [+0.5 per cent].
Simpson said the higher costs are reflected in higher construction costs.
“The supply of labour is tight and costs are rising right across the board,” he said.
Simpson also said there is a high level of residential construction in Vancouver and that construction activity will only rise with the 2010 Olympics coming to the city.
Leon Comeau, of Statistics Canada’s price division, that another reason for the city’s higher construction costs is because Vancouver’s housing market strengthened in the second half of 2004.
“This led to slightly higher costs in Vancouver,” he said.
Comeau agreed that the higher prices of construction materials were a factor. “We found the cost of steel products over the last year increased.
“And construction costs rose a little more in Vancouver.”
Simpson said that only lumber prices have softened in the Vancouver area. “But everything else is going up.”
© The Vancouver Sun 2005