Price increases lay foundation for record profits in Canada's residential construction industry



    OTTAWA, Aug. 15 /CNW Telbec/ - After posting record profits in 2006,
builders can expect profits to climb even higher to $4.5 billion in 2007,
according to the Conference Board's Canadian Industrial Outlook: Canada's
Residential Construction Industry - Summer 2007.
    "Strong growth in new home prices allowed profits to reach record levels
last year and continues to boost profits in 2007," said Valérie Poulin,
Economist. "With price growth and demand for new construction both moderating,
profits are expected to fall from their 2007 peak, but will still remain high
by historical standards."
    Solid demand has been a key factor driving up prices. However, demand for
new homes has not been uniform across Canada. Although residential
construction continues to grow robustly in the West, housing starts fell in
central Canada and parts of Atlantic Canada in 2006.
    Demographic trends also suggest some softening in Canadian housing
demand. Low population growth is expected to limit demand for new home
construction.
    In recent years, renovations and repairs has been a growing segment of
the residential construction industry. Although spending on renovations is
expected to ease over the forecast period, it will be the main driver of
growth in the industry through the expected downturn in housing starts in 2007
and 2008.
    This is the first release of the Conference Board's new Canadian
Industrial Outlook: Canada's Residential Construction Industry. Published
twice a year, the content for this report was previously included in the
Board's broader construction industry report.




For further information:

For further information: Brent Dowdall, Media Relations, (613) 526-3090
ext.  448, corpcomm@conferenceboard.ca; www.conferenceboard.ca


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