Ontario Construction News staff writer
Construction costs increased in Toronto by 7.94% between April 2023 and April 2024, construction consultancy firm Rider Levett Bucknall (RLB) reports in its Quarterly Cost Report.
The cost increase of 1.78% in the quarter between January and April is similar to that reported in the previous quarter.
“In Ontario, the most prominent projects bin the coming years are those related to power generation, transportation and Healthcare facilities,” RLB says.
“Canada’s three levels of government have agreed to finalize $4.7 billion in Ottawa funding to boost housing construction,” the consultancy says. “The federal and provincial governments agreeed that the province would receive $357 million in federal funds for affordable housing construction. As the province tries to met its target of building 1.5 million homes by 2031, the Ontario government expressed confidence that the Bank of Canada’s recent interest rate cut will help spur housing development.”
Cost increases in Canada (RLB says the annual increase in Calgary was 6.67%) are higher than the US national average, reported to be 1.12% greater than the previous quarter.
“Boston, Chicago, Denver, Honolulu, Los Angeles, Portland, San Francisco, and Washington DC experienced increases over the national average this quarter,” RLB says. “Denver, Las Vegas, New York, Phoenix, and Seattle experienced gains that were less than the national average.”
“The construction industry continues to experience strong demand, but uncertainty is being fueled by high interest rates and increasing labor costs for the rest of 2024. The approaching presidential election and potential policy adjustments are also contributing to this uncertainty,” says Paul Brussow, President of RLB North America. “Nevertheless, overall growth in the construction sector is expected to remain positive this year.”
Other notes from the US report include:
- During Q2 2024, the U.S. national average increase in construction cost is approximately 1.12 percent; compared to 1.31 percent in the first quarter.
- Year-over-year, the U.S. national average increase in construction costs is approximately 5.41 percent; compared to 5.85 percent YOY in the first quarter.
- The construction unemployment rate is down slightly to 5.4 percent; down from 5.6 percent in the same period last year
- The Architectural Billings Index (ABI) is 42.4; a decrease of nearly 6 points over the previous month.
Read the complete QCR report here.