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New Housing Price Index, November 2021

Released: 2022-01-05

New Housing Price Index — Canada

November 2021

0.8% increase

(monthly change)

New Housing Price Index — N.L.

November 2021

1.2% increase

(monthly change)

New Housing Price Index — P.E.I.

November 2021

0.0%

(monthly change)

New Housing Price Index — N.S.

November 2021

0.0%

(monthly change)

New Housing Price Index — N.B.

November 2021

0.0%

(monthly change)

New Housing Price Index — Que.

November 2021

0.9% increase

(monthly change)

New Housing Price Index — Ont.

November 2021

1.1% increase

(monthly change)

New Housing Price Index — Man.

November 2021

0.6% increase

(monthly change)

New Housing Price Index — Sask.

November 2021

0.1% increase

(monthly change)

New Housing Price Index — Alta.

November 2021

0.0%

(monthly change)

New Housing Price Index — B.C.

November 2021

0.6% increase

(monthly change)

Nationally, new home prices increased 0.8% in November—continuing the string of monthly increases since May 2020. Prices were up in 16 of the 27 census metropolitan areas (CMAs) surveyed, unchanged in 9, and down in 2.

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

Record low housing inventory pushes up new home prices in some Ontario regions

The largest price increases for new homes were in London (+2.8%), Kitchener–Cambridge–Waterloo (+1.9%) and Toronto (+1.4%). In all three regions, a continuing high level of sales activity, record low levels of inventories in the resale sector, combined with higher construction costs in the new build sector, contributed to the rise of home prices in both sectors.

Following an 11.9% increase in October, the price of softwood lumber rose 5.3% in November as reported by the Industrial Product Price Index. With reduced output at Canadian lumber mills and labour shortages in the American mills, lumber prices are expected to continue to rise in the coming months, adding further pressure on the costs of building new homes.

Impact of flooding in British Columbia on the new housing market in November

As a result of historic rainfall and flooding in British Columbia, builders in Kelowna and in some parts of Vancouver were not required to report data. However, the immediate impact to the New Housing Price Indexes' response rates for November in these regions was minimal.

Damage incurred to major transportation routes in the Southwestern and interior regions of the province caused bottlenecks in the port of Vancouver. As they continue to clear the backlog of vessels unloading cargo, disruptions occurred in the supply chains of many commodities, including building materials.

New home prices up year over year in all CMAs surveyed, largest gains in Ontario

Nationally, new home prices rose 11.7% year over year in November.

New home prices were up in all 27 markets surveyed on a year-over-year basis, with the largest gains once again observed in Kitchener–Cambridge–Waterloo (+29.0%), Windsor (+22.8%) and Ottawa (+22.4%).

Chart 2  Chart 2: New house prices rise at the national level
New house prices rise at the national level

Outlook for the new housing market

The new housing market has seen rapid price growth throughout the pandemic in most cities. Paul Beaudry, the Deputy Governor of the Bank of Canada remarked that factors contributing to increased demand included low borrowing costs, incentivizing people to buy sooner than planned, higher savings, allowing for larger down payments, the anticipation of higher home prices in the future, and demand for larger sized homes outside of major cities to accommodate changes to living style. In addition to these factors, the mix of new home buyers has changed with year over year home purchases increasing more for investors than for first-time home buyers and repeat buyers.

Supply has been slow to catch up to the increased demand of new homes based on a number of factors such as construction lag times attributed to municipal land use planning, building regulations, as well as shortages of labour and building construction materials. Housing supply has been particularly low for Vancouver, Toronto and Montréal.


  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 the contract is signed. The detailed specifications for 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 and the provincial harmonized sales tax.

The survey covers the following dwelling types: new single homes, semi-detached homes and townhomes (row or garden 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 (see Methodology of 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

The article "The resilience and strength of the new housing market during the pandemic" examines the changes in new home prices in Canada for the 27 surveyed CMAs captured in the NHPI. It compares the ranking of cities based on home prices six months into the pandemic (August 2020 compared with February 2020).

The article "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 on the housing market before, during and after the onset of the COVID-19 pandemic.

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 web page. 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 launched the Producer Price Indexes Portal as part of a suite of portals for prices and price indexes. It provides users with a single point of access to a wide variety of statistics and measures related to producer prices.

Next release

The New Housing Price Index for December will be released on January 21, 2022.

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; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).

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