House Prices Unchanged in February, and 0.1% Higher YOY
Apr 14, 2019
New house prices at the national level were unchanged in February, despite growth in some of the housing markets surveyed.
New Housing Price Index, monthly change
In February, builders in 9 of the 27 census metropolitan areas (CMAs) surveyed reported higher prices for homes they sold. London and Windsor (both up 0.6%) registered the largest increases as builders in both CMAs tied the gains primarily to higher construction costs.
Prices continue to rise in London
New home prices have been up almost every month in London since November 2017. Builders have largely linked the increases to strong market conditions.
Higher prices for new homes in London reflected increased demand as well as a strong resale market. This coincided with annual employment growth of 2.2% and a 1.9% population increase in February. According to the Canadian Real Estate Association, London’s sales to new listings ratio was 69.4 in February. A ratio above 60 indicates a seller’s market.
Declines in Canada’s largest new housing markets
Four of Canada’s largest new housing markets experienced slowing demand, as builders reported flat prices in Toronto and Calgary, and declining prices in Vancouver (-0.3%) and Edmonton (-0.1%) in February.
New house prices have decreased for four months in a row in Vancouver as builders linked the decline, in large part, to unfavourable market conditions. The pace of new construction has also slowed in this CMA. According to the Canada Mortgage and Housing Corporation, single-family housing starts declined 20.7% over the 12 months ending in February compared with the same period in 2018. Single-family homes include single, semi-detached and row houses.
New Housing Price Index, 12-month change
New house prices at the national level edged up 0.1% year over year in February.
For the ninth month in a row, home prices in the historically more affordable CMAs of Ottawa (+4.9%) and London (+3.4%) rose faster than in other CMAs surveyed.
Regina recorded the largest decrease (-2.8%) among the 11 CMAs that reported 12-month declines. New home prices in Regina have been decreasing steadily for the past year.
In February, annual price movements also declined in Toronto (-1.0%), Calgary (-0.8%), Vancouver (-0.6%) and Edmonton (-0.4%). These four CMAs combined represent 60% of the weight of the national index.
