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New Housing Price Index, August 2020

Released: 2020-09-21

New Housing Price Index — Canada

August 2020

0.5% increase

(monthly change)

New Housing Price Index — N.L.

August 2020

0.0%

(monthly change)

New Housing Price Index — P.E.I.

August 2020

0.0%

(monthly change)

New Housing Price Index — N.S.

August 2020

1.6% increase

(monthly change)

New Housing Price Index — N.B.

August 2020

0.0%

(monthly change)

New Housing Price Index — Que.

August 2020

0.6% increase

(monthly change)

New Housing Price Index — Ont.

August 2020

0.5% increase

(monthly change)

New Housing Price Index — Man.

August 2020

0.8% increase

(monthly change)

New Housing Price Index — Sask.

August 2020

0.2% increase

(monthly change)

New Housing Price Index — Alta.

August 2020

0.0%

(monthly change)

New Housing Price Index — B.C.

August 2020

0.8% increase

(monthly change)

New home prices rise at their fastest pace since May 2017

Prices for new homes increased for the fourth consecutive month, rising 0.5% nationally in August. This marked the largest monthly increase for new home prices at the national level since May 2017. New home prices rose in most of the 27 census metropolitan areas (CMAs) on increasing demand for single-family homes and higher building material costs in the wake of the pandemic. With physical distancing measures still in place, some homeowners chose to divert their summer vacation funds towards renovations and home improvements.

Chart 1  Chart 1: New Housing Price Index
New Housing Price Index

New Housing Price Index, monthly change

Oshawa (+1.8%) and Québec (+1.7%), which offer relatively more affordable housing prices than the nearby Toronto and Montréal markets, posted the largest new housing price gains in August. Prices in Halifax (+1.6%) rose for the eighth consecutive month. Low inventory of homes available for sale, coupled with increased demand, drove prices of new homes up in these markets.

Prices of new homes increased in Vancouver (+1.0%) for the third consecutive month. In Toronto, prices rose 0.3% for a second consecutive month. Builders cited market conditions as the reason for the increases in both of these CMAs in August.

Calgary (-0.1%) posted the lone decrease in August as builders reported less favourable market conditions.

New Housing Price Index, 12-month change

At the national level, new house prices rose 2.1% during the 12-month period ending in August—the largest year-over-year increase since March 2018.

In August, year-over-year prices increased in the majority of the 27 CMAs, led by Ottawa (+11.6%) and Montréal (+6.5%) for the 14th month in a row. Low inventory of homes available for sale continued to push prices up in these two CMAs.

Regina (-4.2%) continued to post the largest year-over-year decline.

Chart 2  Chart 2: New house prices are up 0.5% at the national level
New house prices are up 0.5% at the national level

Outlook for the new housing market during COVID-19

In the short term, it is expected that the shortage of lumber and building supplies will persist due to the uptick in homebuyer demand, the increased renovation activities in North America, as well as the lingering effects of the reduced operations at sawmills earlier this year. These factors will continue to put upward pressure on new house prices. Homebuilders say that the record high lumber prices this year will most likely add an extra $5,000 to $10,000 to the cost of a single family house.


  Note to readers

The New Housing Price Index (NHPI) measures changes over time in the selling prices of new residential houses. The prices are those agreed upon between the contractor and the buyer at the time of the signing of the contract. The detailed specifications pertaining to each new 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 provincial harmonized sales tax.

The survey covers the following dwelling types: singles, semi-detached and townhouses or row homes. The index is available at the national and provincial levels, and for 27 census metropolitan areas (CMAs).

The index is not subject to revision and is not seasonally adjusted.

In addition to this monthly release, the NHPI has also been integrated into the Residential Property Price Index (RPPI). The RPPI is a quarterly series that measures changes over time in the prices of residential properties for Montréal, Ottawa, Toronto, Calgary, Vancouver and Victoria. An aggregate for these six CMAs is also available. The RPPI provides a price index for all components of the housing real estate market—new and resale—in addition to a breakdown between houses and condominium apartments.

Products

A study on "Price trends and outlook in key Canadian housing markets" looks at where the housing market was at the onset of the COVID-19 pandemic, sheds light on what has happened since then, and explores the challenges of the Canadian market going forward.

The infographic "The impact of COVID-19 on Key Housing Markets," part of the series Statistics Canada – Infographics (Catalogue number11-627-M), is available. It provides an outlook of the housing market before, during and after COVID-19.

The "New Housing Price Index: Interactive Dashboard," which allows users to visualize statistics on new housing prices, is available.

The "Housing Market Indicators" dashboard, which provides access to key housing market indicators for Canada, by province and by CMA, is also available.

For more information on the topic of housing, visit the housing statistics portal.

The video "Producer Price Indexes" is available on the Statistics Canada Training Institute webpage. It provides an introduction to Statistics Canada's Producer Price Indexes: what they are, how they are compiled and what they are used for.

Statistics Canada has launched the producer price indexes portal as part of a suite of portals for prices and price indexes. This web page provides users with a single point of access to a wide variety of statistics and measures related to producer prices.

Next release

The NHPI for September will be released on October 21.

Contact information

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; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).

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