Photo by D'Arcy Norman

Calgary region building permits took a surprise fall in January as both residential and non-residential activity weakened, according to Statistics Canada. The value of building permits in the area was down to $181.6 million for the month, which is a 35.3 per cent decline from January 2010.

Overall, the value of permits slid in six provinces, led by Ontario. Statistics Canada building permit figures at the national level showed a decline to $5.4 billion, down 5.1 per cent from December as well as 4.0 per cent compared to January 2010.

In a report last week, BMO Capital Markets senior economist Sal Guatieri commented on the situation by saying that tighter mortgage rules (which come into effect March 18) along with higher interest rates, lower affordability and elevated household debt, "should keep house prices on a tight leash.”

Fortunately, the situation is not as grim when you consider the residential sector alone: the value of permits edged down 0.9 per cent to $3.7 billion following a 19.6 per cent increase in December, as Statistics Canada showed.