Keeping up with housing for growing population 'a pipe dream,' says P.E.I. construction association

Without a huge increase in the construction industry labour force, there is no hope of building the number of homes that would be required to keep pace with Prince Edward Island's population growth, says the Construction Association of P.E.I.

The latest population figures from Statistics Canada show the province gained 7,755 people from April to April, a growth rate of 4.6 per cent. Given an average household size of 2.3 people, that equals a requirement for more than 3,300 new apartment or condo units and single-family houses.

And that is not feasible, said Sam Sanderson, general manager of the Construction Association of P.E.I.

"Three thousand homes is an unrealistic number in this market space, with the labour force that we have. It's a pipe dream," said Sanderson.

"To build at the rate that is really required, we would probably — and this would only be an estimate — we'd need at least a couple more thousand people, new people to the industry."

Since people started talking about a housing crisis on the Island in 2018, the industry has had some success in growing the workforce. In 2018 the workforce averaged about 6,000, and has added a little over 1,000 since.

To add another 2,000, needed essentially immediately, would be even more difficult in the current environment, with labour shortages in construction all across the country, said Sanderson.

Slowest year since 2018, permits suggest

The trouble the industry is having to keep up is reflected in data on building permits published Thursday by Statistics Canada.

Permits for new residential construction on P.E.I. covering January to July of this year would create just 760 new homes. 

That's the slowest pace since 2018. The same period last year included 982 homes, with the total for the year coming in at 1,488. The number of units included in permits peaked in 2021 at 1,715.

The number of apartment units in building permits is actually up over last year, but that is offset by a 40 per cent drop in the number of single-family homes.

That reflects the increase in interest rates, said Sanderson. Rising mortgage rates are slowing down the single-family home market, because they have become more difficult to afford.