RBC Financial Group’s economists say that today’s building permit data carries mixed messages for the Canadian economy.

Statistics Canada reported today that the overall value of Canadian building permits increased in June, thanks to a strong surge in proposed commercial and institutional projects. However, construction intentions in Canada’s housing sector fell for the second straight month. In total, municipalities issued just over $3.8 billion in building permits, up 4.6% from May.

Builders took out $1.6 billion in non-residential building permits in June, the highest level in the last 11 months and a 19.1% jump from May. Building permits in the residential sector slid 3.5% to $2.3 billion, the second consecutive monthly decline.

“Residential permits slipped for the second straight month as an advance sign of cooling housing market conditions particularly in the condominium sector,” RBC says. Multi-family units dropped 14%, and permits for single-family dwellings rose less than 1%.

“Declines in Ontario had the biggest effect on the overall picture, resulting from a sharp decline in multi-family permits. This is consistent with our views expressed in our earlier report on challenges facing the Toronto condominium market. Offsetting the decline in residential permits was a sharp surge in non-residential permits that was mostly attributable to hotel and recreational projects in the St. Catharines-Niagara region of southern Ontario,” it notes.