Canada September New House Price Index Report (Text)

The following is the text of the new house price index report for September released by Statistics Canada.

The New Housing Price Index (NHPI) rose 0.2% in September, following a similar increase in August.

The top contributor to the advance was the combined metropolitan region of Toronto and Oshawa, where prices increased 0.6% from August. Market conditions and higher labour costs were the primary reasons cited for the higher prices.

Prices rose 0.5% in both Winnipeg and the combined region of Saint John, Fredericton and Moncton. The increase in each was primarily the result of higher land prices.

Prices were unchanged in 8 of the 21 metropolitan regions surveyed in September. Monthly prices declined 0.4% in Victoria and 0.2% in St. John’s as a result of lower negotiated selling prices.

On a year-over-year basis, the NHPI rose 2.4% in the 12 months to September, following a similar increase the previous month. The main contributor to the advance was the combined metropolitan region of Toronto and Oshawa, where the year-over- year increase in contractors’ selling prices was 5.1%. Québec, Winnipeg and Regina followed, each with a 3.5% increase.

Other significant year-over-year increases occurred in Kitchener-Cambridge-Waterloo (+3.0%) and Windsor (+2.6%).

Among the 21 metropolitan regions surveyed, 4 posted 12- month price declines in September. The largest decrease was in Victoria (-3.3%).

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 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 provincial government of British Columbia introduced legislation on May 14, 2012, announcing the return to a provincial sales tax on April 1, 2013. From April 1, 2012, until March 31, 2013, there are new housing transitional rebates in place. After the transition is complete, the provincial sales tax on building materials in British Columbia will be embedded in contractors’ selling prices of new houses. These changes will be reflected in the New Housing Price Index as reported by respondents.

The indexes are not subject to revision and are not seasonally adjusted.

To contact the reporter on this story: Ilan Kolet in Ottawa at ikolet@bloomberg.net

To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net

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