The City of Nelson issued 231 building permits in 2021, a record number.
Renovations led the way, with 137 permits issued for updates to single-unit buildings and 42 permits to renovate commercial and industrial buildings.
There were 14 permits for new houses and six for new multi-unit housing, as well as smaller numbers for other categories.
The total value of 2021 construction projects amounts to $34,300,604, which is not a record – the figure was exceeded in 2019 when three large multi-unit residences in Nelson were given permits.
At the Regional District of Central Kootenay, chief administrative officer Stuart Horn told the Nelson Star that it issued 620 permits in 2021, and that the value of construction — $81,166,769 — is the highest the RDCK has ever seen. These numbers include permits and construction in the rural areas and in the municipalities of Nakusp, Kaslo, Silverton, New Denver, Salmo and Slocan.
Nelson’s Mayor John Dooley says this trend has contradicted predictions at the beginning of the pandemic that there would be a downtown in the economy. Dooley said this didn’t occur in construction, which surprised him.
“If you were to call most people in the construction sector and ask them to reflect on the previous year, [they would tell you] it was a total surprise …. It’s staggering really, to be honest with you.”
He said building supply companies had substantial increases in sales in 2021.
Dooley said people who bought houses in Nelson in the past year may have bought older houses when they had not intended to, because of the lack of housing supply. Then they renovated them, perhaps because they had less work during the pandemic or they were working from home.
Low interest rates also played a part.
“Getting mortgages and loans were relatively easy,” Dooley said. “There was a lot of liquidity in the economy, and that money was out there, and that was going to be spent somewhere. Most people tend to look at housing as a security blanket, if you can call it that.”
Scott Wild, CEO at the Southern Interior Construction Association, agrees that 2021 was initially a very optimistic year for the construction industry across the Interior, partly because governments have funded many large projects in response to the pandemic.
“But the caution that I would give,” he told the Nelson Star, “is that while there is a lot that has been approved, a lot of it has not actually been built.”
While there may be a record amount of work approved, it will take longer than usual to complete these projects. He cited supply chain issues and labour shortages.
“We were facing labour shortages for the next three years even before the pandemic exacerbated the situation.”
He said construction activity during the year was also affected by extreme weather, including fires and floods.
“Our access from the coast to the Interior was completely cut off for a period of time.”
Wild said he is concerned that recent issues facing the trucking industry in B.C. could soon come to a head, furthering the strains on supply chains.
“Between ongoing issues of supply and workforce challenges this year, completing our work on hand and forecasting what’s upcoming has been incredibly challenging for the industry,” Wild said. “My concern is that with materials and manpower facing limited supply and prices increasing, we could see the cost of construction climb significantly.”