Canadian Building Permits Drop 10.6 %

The value of Canadian building permits plunged 10.6 % in April, a far bigger drop than expected, as both residential and nonresidential construction activity slowed after March's second-strongest showing on record.

Eeconomists said the bigger setback did not signal a bursting of the housing market bubble.

It was the lowest level for permits since November 2005 and 1.5 percent below the average monthly level for last year as a whole.

However, construction activity remained healthy overall amid an upward trend in permits that began last year.

It's really quite normal to expect quite a bit of a decline after seeing gains in the last few months, in some cases exceeding 20 %.

We'd have to see a couple more months where building permits and aggregate continue to fall before there would be a big signal on a reversal in the housing market.

Housing permits dropped 5.7 percent in value as single-family housing permits slipped for the third straight month and permits for multiple-family dwellings fell 8.7 percent after two months of gains.