Waiting until after the HST is scrapped before buying a new home will pose no advantage,says a Prince George builder who blames the slow-going construction in part on the provincial government's decision to scrap the tax in about 18 months time.
As of the end of September, there have been starts on 92 single-family homes compared to 124 by the same point last year, according to the Canada Mortgage and Housing Corporation.
And Prince George Home Builders Association past president Allen Creuzot suspects prospective customers are waiting until the tax is completely done away with before making a purchase in the mistaken belief they'll save money by waiting until that time.
While that may be true in the Lower Mainland, Creuzot said most buyers in Prince George will actually come out slightly ahead because new homes in this city remain priced low enough to gain the full benefit of the new home rebate provided by the provincial government.
He said the Canadian Home Builders Association - B.C. website, www.chba.ca - has an online calculator that shows how big the exemption can be.
"There's been a huge confusion over this thing ever since they introduced it," Creuzot said.
Over September, there were 14 starts on new homes, down slightly from 18 starts over the same month last year.
Although still below last year's total, Creuzot said it shows the gap has narrowed after an extremely slow start due to the longer than usual winter and the wet spring, which made it difficult to break ground.
He said the custom home builders are probably suffering the biggest impact.
"For the spec people, there are still a lot of customers in the housing market," Creuzot said.
Looking at construction generally, permits for $10.2 million worth of work were taken out at City Hall in September, down slightly from $10.4 million over the same month last year and significantly lower than $15.3 million two Septembers ago.
Year to date, the total now stands at slightly less than $65 million, well down from $123 million three-quarters into 2010, but higher than $55.4 million reached by the same point in 2009.
Northern B.C. Construction Association president Rosalind Thorn said the Cancer Centre of the North was likely the reason for the spike in last year's third quarter total and suggested there will be a similar jump for 2011 when the new RCMP detachment is included in the October total.
Companies and tradespeople are keeping busy elsewhere on jobs not included in city hall's building permit report, she added
"The building permits are a fairly good barometer of how the industry is doing, but what we have to remember is there are all kinds of heavy industry and roads and civil work that isn't included," Thorn said. "We've got contractors busy all over Northern B.C. with the mines, and oil and gas, and subdivisions and Rio Tinto Alcan. There's lots going on in the North."
Significant projects for which permits were issued by City Hall in September:
- Rebuild of Boston Pizza at 841 Central Street West, $862,000.
- Petro Canada piping upgrade at 1064 Great Street, $315,000.
- New duplex at 7496 -7492 Creekside Way, $260,758.
- New modular classroom at Glenview elementary school, 7610 Cluff Road, $221,082.
Also, permits for 14 single family homes worth a total of $3.7 million were issued.
Source: City of Prince George monthly building report
