New Housing Price Index, January 2014
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Released: 2014-03-13
The New Housing Price Index (NHPI) rose 0.3% in January, following a 0.1% gain in December. The national increase was the largest since May 2012 and mainly the result of strong gains in the Prairie region.
Chart 1
New Housing Price Index
The metropolitan region of Calgary was the top contributor to the January rise, with prices up 1.3% over December. Builders reported that higher material and labour costs as well as market conditions were the primary reasons for the increase, the largest in the region since April 2007.
The biggest monthly price gain in January was in Saskatoon (+1.4%), where builders raised list prices to coincide with the new calendar year. The advance marked the largest monthly increase in the city since March 2008.
Prices were also up in Winnipeg (+0.5%), as builders moved to new phases of development with higher land development costs. Price changes in this region had been fluctuating between 0.0% and 0.2% since June 2013.
Prices were down 0.3% in Kitchener–Cambridge–Waterloo for the second consecutive month. New housing prices also fell 0.3% in Charlottetown. The decrease, the largest in that region since December 2012, was mainly due to lower negotiated selling prices between builders and buyers.
Prices for new homes declined 0.2% in Ottawa–Gatineau, St. Catharines–Niagara and Hamilton. Builders in both Ottawa–Gatineau and St. Catharines–Niagara offered promotional pricing to stimulate sales. Prices in the St. Catharines–Niagara region had not decreased since May 2012. In Hamilton, lower negotiated selling prices were the main reason for the January price decline.
Prices were unchanged in 7 of the 21 metropolitan areas surveyed in January.
On a year-over-year basis, the NHPI rose 1.5% in January, following a 1.3% increase in December. The pace of annual growth had been slowing since August.
The two main contributors to the annual advance were Calgary and the combined metropolitan region of Toronto and Oshawa. Calgary saw a 7.0% increase, its highest annual rise since July 2007. The combined region of Toronto and Oshawa reported a 1.4% year-over-year increase in contractors' selling prices for the third month in a row.
New housing prices were up 3.5% in January in both Saskatoon and Regina compared with the same month in 2013. This was the largest increase in Saskatoon since December 2010.
Other significant year-over-year increases occurred in St. Catharines–Niagara (+2.6%) and Winnipeg (+2.5%). In Winnipeg, the pace of growth in new home prices has been slowing for the past six months.
Among the 21 metropolitan areas surveyed, 5 posted 12-month price declines in January: Ottawa–Gatineau and Vancouver (both down 1.1%), Victoria (-0.8%) as well as Edmonton and Kitchener–Cambridge–Waterloo (both down 0.2%). This was the first annual decrease in Kitchener–Cambridge–Waterloo since June 2013.
Chart 2
Calgary posts the largest year-over-year price increase
Note to readers
The New Housing Price Index measures changes over time in the selling prices of new residential houses agreed upon between the contractor and the buyer at the time of the signing of the contract. It is designed to measure the changes in the selling prices of new houses where detailed specifications pertaining to each house remain the same between two consecutive periods. The survey covers the following dwelling types: single dwellings, semi-detached and row houses (town house or garden home). The prices collected from builders and included in the index are market selling prices less value added taxes, such as the Federal Goods and Services Tax or the Harmonized Sales Tax.
The index is not subject to revision and is not seasonally adjusted.
The New Housing Price Index for February will be released on April 10.
Contact information
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