Investment in building construction increased in BC in December, but one economist says the monthly data is “lumpy” and masks severe weakness in the province’s residential sector.

Investment in building construction in BC totalled $3.58 billion in December, a 20.4% increase compared to December 2024, according to data released Feb. 18 by Statistics Canada (StatCan).

A majority of this was residential building construction, which totalled $2.5 billion in December, a 26.8% increase compared to the same month a year earlier.

Within the residential category, investment in detached homes totalled $897.3 million, an increase of 41.4%. Apartments meanwhile accounted for $1.39 billion, a 21.3% increase.

These numbers may look good, but they hide the significant downturn in the province’s real estate sector, said Jock Finlayson, chief economist with the Independent Contractors and Businesses Association (ICBA).

“It’s really a complete, almost apocalyptic scenario for new residential development, which is totally inconsistent with this number for December,” he said.

A few large multi-family projects can easily inflate the data for a given month, he said.

On the contrary, residential homebuilding is expected to decline in 2026 and 2027, he said.

Development projects are being shelved and cancelled in the Lower Mainland, and there are thousands of unsold condos sitting empty, he said.

Financing is another calamity. Presale demand for new condos “has basically evaporated” and the presale model has broken down, Finlayson said.

“The ability to have these presale units was an integral part of the business model for multi-family development, and that’s totally collapsed,” he said.

Many developers are struggling financially, layoffs are occurring and the industry is contracting, he noted.

Strong population growth in recent years has now given way to absolute declines, curbing residential demand, he added.

Finlayson also cited a cost-of-delivery crisis, whereby the cost of delivering new product exceeds what buyers can afford to pay for it.

Things look a bit different on the non-residential side.

StatCan said non-residential construction was $1.08 billion in BC in December 2025, a 7.8% increase compared to December 2024.

This consisted of industrial (down 33.2% to $82.2 million), commercial (up 3.6% to $568.5 million) and institutional and governmental (up 29.9% to $428.7 million).

ICBA’s Finlayson said the institutional and government component is particularly strong due to high capital spending and new public projects being undertaken.

“There’s more underlying strength there,” he said.

“Residential is where things are really going south.”

ICBA Economist : BC Residential Sector Reeling Despite Strong December Data by Jami Makan | BIV