The rate of growth in new housing prices slowed again in October

The rate of growth in new housing prices slowed again in October, the 14th straight month in which the pace of growth has either decelerated or held steady.

Contractors' selling prices increased 6.1% between October 2006 and October 2007, compared with a 6.2% year-over-year increase in September. October's rate of growth was only half of the pace of 12.1% in August 2006, the most recent high.

On a monthly basis, prices rose 0.1% between September and October, resulting in a New Housing Price Index of 155.7 (1997=100). This is the third month in a row in which the growth rate in new housing prices has decelerated. In July 2007, the rate of growth was 0.9%.

Saskatoon again led the country, with the largest year-over-year price increase of 47.9%. This is down from its all-time high gain of 53.6% in August 2007. On a monthly basis, new housing prices in Saskatoon rose 0.7% from September.

In Regina, new housing prices were up 29.5% over October 2006. However, on a monthly basis, prices remained unchanged.

In Calgary, prices were 6.2% higher than in October last year. But on a monthly basis, they declined 0.2% from September, the first decrease in the month-over-month series since December 2006. This drop comes as builders reduce pricing on some models to reflect current market conditions in the city.

In Edmonton, prices were 24.3% higher than in October 2006, a continued deceleration from the high in November 2006. Prices in Edmonton rose 0.3% from September to October, mainly the result of higher reported land values.

In Vancouver, prices rose 6.2% between October 2006 and October 2007, due to increased costs of labour and material. This compared with a 6.1% rise in September. On a monthly basis, prices in Vancouver rose 0.7% from September, the result of strong market conditions for sellers and increasing land values in the Lower Mainland area.

In Victoria, contractors' total selling price remained unchanged from September. The year-over-year change remained steady at 0.7%.

In Ontario, Windsor was again the only city in Canada recording year-over-year deflation. New housing prices for the city declined 2.6% from October 2006. They remained unchanged from September 2007.

Elsewhere in Ontario, year-over-year housing price increases remained mostly steady. Healthy home markets allowed builders to increase prices moderately in Toronto (+2.8%) and St. Catharines (+4.5%).

In Montreal, growth slowed to 4.2% year-over-year. Declines attributed to a competitive market were offset by increased costs.

In the Atlantic region, increases in labour and materials pushed prices up in St. John's (+6.7%). In New Brunswick, new housing prices rose 1.1% in the year to October 2007, and 0.3% between September and October, in the wake of favourable market conditions for contractors.

Available on CANSIM: table 327-0005.

Definitions, data sources and methods: survey number 2310.

The third quarter 2007 issue of Capital Expenditure Price Statistics (62-007-XWE, free) will be available in February 2008.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Client Services (              613-951-9606       , fax: 613-951-1539; prices-prix@statcan.ca).