The value of Canadian building permits hit $74.3 billion in 2007, Statistics Canada said today. This is up 12.1% from $66.3 billion in 2006, and the strongest rise since 2002.

Building permits moved up to $6.1 billion in December, a 0.4% gain over November. Analysts had widely predicted there would be no change.

Residential permits rose 1.8%, while non-residential permits dipped by 2% in December.

Stats Can said the increase in 2007 was more widespread across the country compared with 2006, when the gain was largely fuelled by high demand in Western Canada.

“Overall, the report offered a mixed picture on the Canadian housing sector, though it suggests that housing activity in 2008 will likely fall modestly off the robust pace seen in 2007,” said Millan Mulraine, economics strategist at TD Securities, in a morning note.

Intentions set new records in both the non-residential and residential sectors in 2007. In the non-residential sector, the value of permits totalled $28.7 billion, up 13.8% from 2006. All three components (industrial, commercial and institutional) recorded strong growth.

In the housing sector, municipalities issued $45.6 billion worth of permits, up 11.0%.

“This result contrasted sharply with the situation in the United States, where the number of new privately-owned units approved fell by 25.3% in 2007,” said Stats Can in its morning commentary.

“The slower pace of residential permit activity in the fourth quarter points to a moderation in home construction spending in early 2008, although the softening is likely to be relatively limited against a backdrop of falling interest rates,” said RBC senior economist Dawn Desjardins in a note.