UPDATE 2-Canada Feb building permits soar; housing down

* Permits jump 9.9 pct on nonresidential strength

* Industrial building permits hit record high in Feb

* Housing market seen slowing
(Adds details)

OTTAWA, April 7 (Reuters) – The value of Canadian building
permits rose far more than expected in February after falling
in January, but there were further signs of a slowing housing
market.

Statistics Canada said on Thursday building permits rose
9.9 percent in value in February, compared with the consensus
forecast of a 1.0 percent gain.

Permits fell 6.6 percent in January, according to the
agency’s revised figures.

Residential permits fell 18.3 percent to their lowest level
since July 2009. Plans for multifamily dwellings took the
biggest hit, falling 34.4 percent, while single-family housing
permits slid 8.6 percent.

Analysts said the government’s moves to tighten mortgage
rules combined with warnings to homeowners that interest rates
will soon rise appear to have helped cool a previously
overheated housing market.

“A further deterioration in residential builder intentions
in March would tend to suggest that …changes in the funding
formulas for mortgages in Canada is taking a bite out of the
demand for new housing, suggesting that the widely anticipated
slowdown in the housing sector … is now upon us,” said
Stewart Hall, economist at HSBC Canada.

Housing starts rose 6.6 percent in February, a separate
report showed last month, but analysts warned the strength was
unlikely to carry into coming months and pointed to a more
modest growth trend in housing.

Avery Shenfeld, economist at CIBC World Markets, said
building permits overall appear to have peaked in March 2010.
Shenfeld forecasts a 10 percent drop in Canadian housing starts
this year from last year.

Statscan said nonresidential permits soared 72.9 percent
due largely to plans for transportation-related buildings in
Alberta and factories in Ontario, which pushed industrial
construction permits to a record high. Permits for
institutional buildings doubled after four consecutive declines
and the commercial building component rose 22.6 percent.

Compared with a year earlier, building permits overall rose
6.5 percent, with residential permits down 15.6 percent and
nonresidential permits up 47.3 percent.
(Reporting by Louise Egan; editing by Peter Galloway)

UPDATE 2-Canada Feb building permits soar; housing down