New Housing Price Index, January 2015
The New Housing Price Index (NHPI) fell 0.1% in January, largely as a result of lower negotiated selling prices. This was the first decrease at the national level since July 2010.
The combined metropolitan region of Toronto and Oshawa was the top contributor to the monthly decline with prices down 0.1% from the previous month. The decrease was mainly due to builders offering promotional packages to stimulate sales and lower negotiated selling prices. However, it was moderated by some reports of higher prices due to market conditions and increased land costs. This was the first decline in Toronto and Oshawa since July 2014.
Higher list prices were offset by lower negotiated selling prices in the census metropolitan areas (CMAs) of Ottawa–Gatineau (-0.3%) and Vancouver (-0.1%). This was the largest decrease in Ottawa–Gatineau since November 2013 and the third consecutive monthly decrease in Vancouver.
Following three months of flat prices, the CMA of Victoria posted a 0.5% decline in January as a result of lower negotiated selling prices. New housing prices also fell in Edmonton (-0.2%) as a result of lower negotiated selling prices. This was the first monthly price decline in Edmonton since April 2014.
New housing prices in Calgary were unchanged following 25 months of increases. Prices were also unchanged in 10 other metropolitan areas surveyed.
St. Catharines–Niagara recorded the largest price increase among the metropolitan areas surveyed, as prices rose 0.6% in January. Builders cited market conditions as the primary reason for the gain. This was the largest monthly price increase in that CMA since February 2014.
For the third straight month, new housing prices were up in London (+0.3%) largely as a result of higher material and labour costs, according to builders.
Montréal, Hamilton and Winnipeg also recorded small price increases in January (+0.1% for all three). In Montréal, where prices have been flat or declining since August, some builders raised list prices for the new year. Builders in Hamilton cited higher land development fees as the reason for the latest price increase—the smallest price increase in that CMA since March 2014. In Winnipeg, builders reported higher labour costs as the reason for the gain.
On a year-over-year basis, the NHPI rose 1.4% in January, down from a 1.7% increase in December. This was the smallest annual gain since July of last year.
Calgary (+5.1%) and the combined metropolitan region of Toronto and Oshawa (+2.2%) continued to lead the annual growth, albeit at a slower pace than previously reported.
Other significant year-over-year increases were reported in Hamilton (+3.6%) and London (+3.0%). This was the largest annual price movement in Hamilton since March 2008 and the largest in London since June 2010.
Among the 21 metropolitan areas surveyed, 8 posted year-over-year price declines in January: Victoria (-1.5%), Charlottetown and Ottawa–Gatineau (both down 1.3%), Vancouver (-0.6%), the combined metropolitan region of Saint John, Fredericton and Moncton (-0.4%), Regina and Saskatoon (both down 0.2%) as well as Montréal (-0.1%). This was the first annual price decline in Saskatoon since January 2010.
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 houses and row houses (town houses or garden homes). The survey also collects contractors' estimates of the current value (evaluated at market price) of the land. These estimates are independently indexed to provide the published series for land. The residual (total selling price less land value), which mainly relates to the current cost of the structure, is also independently indexed and is presented as the estimated house series. The index is available at the Canada and provincial levels, and for 21 metropolitan areas.
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 9.
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; email@example.com) or Media Relations (613-951-4636; firstname.lastname@example.org).
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