New Housing Price Index

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The New Housing Price Index (NHPI) rose 0.3% in April following an identical increase in March.

Between March and April, prices increased the most in St. John's (+1.1%), followed by Regina and Saskatoon (both up +0.9%). In these three census metropolitan areas, builders reported higher material and labour costs as key factors in the price increases.

Charlottetown (-0.3%) as well as Greater Sudbury and Thunder Bay (-0.3%) registered the largest monthly decreases in April, followed by Montréal and Hamilton, which were both down 0.1%.

In Charlottetown, as well as in Greater Sudbury and Thunder Bay, builders indicated they lowered prices to remain competitive.

Year over year, the NHPI was up 2.5% in April following a 1.6% increase in March. Vancouver posted a particularly strong year-over-year price increase.

The largest year-over-year increase was recorded in Vancouver (+6.0%), followed by St. John's (+5.9%) and Winnipeg (+4.9%).

Compared with April 2009, contractors' selling prices were also higher in London, Ottawa–Gatineau, Regina and Québec.

Among the 21 metropolitan areas surveyed, 3 registered 12-month declines in April: Victoria (-3.8%), Charlottetown (-1.5%) and Edmonton (-1.0%).

Note: The New Housing Price Index (NHPI) 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 (GST) of the Harmonized Sales Tax (HST).

As of July 1, 2010, the HST will come into effect in Ontario and British Columbia. According to the Canada Revenue Agency "[if] the written agreement of purchase and sale is entered into after June 18, 2009 (November 18, 2009, in British Columbia), and both ownership and possession of the house transfer to the purchaser after June 2010, the HST at 13% (12% in British Columbia) would apply to the sale." Several builders in Ontario and in British Columbia are already including the HST in the prices of some of their new houses.

The provincial sales tax on building materials in Ontario and in British Columbia is embedded in the contractor's selling prices of new houses. With the introduction of the HST in these two provinces, this provincial sales tax will be eliminated and replaced by the HST. As value added taxes are conceptually excluded from the index, this change may cause negative monthly variations in the index for some metropolitan regions in Ontario and British Columbia during the implementation period of the tax.

This release presents data that are not seasonally adjusted and the indexes published are final.

Available on CANSIM: table 327-0005.

Definitions, data sources and methods: survey number 2310.

The first quarter 2010 issue of Capital Expenditure Price Statistics (62-007-X, free) will be available in July.

The new housing price indexes for May will be released on July 8.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Client Services (613-951-4550; toll-free 1-888-951-4550; fax: 613-951-3117; ppd-info-dpp@statcan.gc.ca), Producer Prices Division.