The cost of new housing rose significantly in July

The cost of new housing rose significantly in July with Alberta continuing to drive up the national figures. The New Housing Price Index rose by 1.1% over the previous month to 143.5 (1997=100), continuing the trend of consecutive monthly increases of at least one percent. Compared to one year ago, contractors' selling prices have increased 10.8%.

Prices advanced in 17 of the 21 metropolitan areas surveyed. Calgary continued to lead the way with a monthly increase of 4.6% followed by St. John's (+2.9%), Edmonton (+1.9%), Hamilton (+1.6%), Regina (+1.2%) and Saskatoon (+1.0%). Increasing costs for construction materials and labour rates, combined with strong market conditions, accounted for most of the increases. Calgary and Edmonton continued to experience strong demand plus land shortages and prolonged construction times, which also contributed to the increases.

Other noteworthy gains were observed in Ottawa–Gatineau (+0.8%), London (+0.8%), Windsor (+0.7%) and Winnipeg (+0.6%) where construction material and labour costs contributed to the increases. Monthly increases were also registered in Halifax, Charlottetown, Saint John, Fredericton and Moncton, Toronto and Oshawa, St. Catharines–Niagara, Greater Sudbury/Grand Sudbury and Thunder Bay and Vancouver. Of the 17 metropolitan areas showing increases, land prices rose in 15.

Two metropolitan areas registered no monthly change while Kitchener (-0.1%) and Victoria (-0.6%) posted decreases due to competitive pricing.

As was the case for the last eight months, Calgary (+56.0%) posted the largest 12 month increase for new homes. Edmonton was next (+29.7%) followed by Winnipeg (+9.7%), Saskatoon (+9.5%) and Regina (+9.3%).

Available on CANSIM: table 327-0005.

Definitions, data sources and methods: survey number 2310.

The second quarter 2006 issue of Capital Expenditure Price Statistics (62-007-XIE, free) will be available in October.

For more information, or to enquire about the concepts, methods or data quality of this release, contact our Client Services Section (613-951-9606, fax: 613-951-1539; infounit@statcan.ca) or Randy Sterns (613-951-8183; randy.sterns@statcan.ca), Prices Division.