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The total value of building permits in Nova Scotia from the first of January to April increased 16 per cent to $526 million, compared to $453 million during the same period last year, Statistics Canada data reveals.

The data, which was updated recently, shows a decrease in the monthly building permits value. There was $174 million in permits in January and in April building permits amounted to $115 million.

The value of building permits, however, can be volatile when looking at the monthly numbers, said Kaitlynn Carson, an analyst with StatCan.

“If you have a permit for a hospital, it’s going to throw your one month up very high … because hospitals are expensive,” she said.

“It’s more interesting to look at longer term trends.”

The value of building permits in Nova Scotia had a general upward trend from 2002 until 2010, when it reached a peak of $1.6 billion. The permits value was generally flat from 2013 to 2016, holding at about $1.2 billion. In 2017, the value of permits rose almost 28 per cent to $1.5 billion and maintained that strength through 2018, Carson said.

“People newly coming from outside the country or coming on a temporary basis, they look for rental tenure... That's driving up demand for rental and multi-unit buildings.” - Neil Lovitt, planning manager at Turner Drake & Partners Ltd.

The value of residential building permits accounted for almost two-thirds of the total value. In 2017, the value of residential permits surpassed the $1 billion mark for the first time, with higher construction intentions for multi-family dwellings including double homes, apartments and row houses, Carson said.

“This reflects the strength shown at the national level for those dwelling types,” she said.

The increase in the total buildings permits value in the province is mainly a result of permits that were issued for large apartment buildings in Halifax, Carson said.

The housing construction has shifted to multi-family housing rather than single detached, said Neil Lovitt, the planning manager at Turner Drake & Partners Ltd., a real-estate counselling firm in Halifax. “The cost of construction of multi-unit housing is higher than single detached housing per square foot of floor space basis.”

“If we’re still building the same, or maybe a little bit higher number of dwelling units every year, but more of them are shifting to apartment building style, that could drive the value up,” said Lovitt. “It’s a more expensive type of construction.”

The demographic changes and the change in the consumer preference trends are pushing the developers to build more apartment buildings. With the aging population in the province, “there’s an increasing desire to downsize from an owner-occupied dwelling to a rental dwelling, to free up equity in the house, as a retirement lifestyle,” said Lovitt.

The population increase in the province is driven by immigration and temporary residents. “People newly coming from outside the country or coming on a temporary basis, they look for rental tenure, rather than ownership just because it's a bit more flexible, while they get used to their new kind of location,” he added.

“That’s driving up demand for rental and multi-unit buildings.”

The capital market conditions are also pushing for more investment and development. “Since 2009, the cost of financing has been quite low. And that’s driving investment patterns (up) globally,” he said.

The shift in development projects toward apartment buildings rather than single-detached houses seems to be a long-term change.

“The demographic trends are pretty long term as far as the aging population goes,” said Lovitt. “The population growth, especially as it’s driven by non-permanent residents, mostly international students, is a bit more up in the air because it’s more volatile,” he added.

“General international immigration trends are driven by policy and macro-economics. And those tend to be a bit difficult to predict and volatile,” he said.

On the capital market side, the expectation is that interest rates are going to start going up. “The outlook long term is a return to normal,” Lovitt said. “But at the same time, the beginning of that pattern seems to keep getting delayed and pushed further into the future.”

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