New home prices in Canada rose 0.3% in April over March, with increases in 10 of 27 metro areas surveyed, down in 1 and unchanged in 16; new home prices were up 9.4% year-over-year in April, the smallest growth since March 2021: Statistics Canada

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OTTAWA , May 19, 2022 (press release) –

National overview
In April, new home prices for Canada showed some signs of cooling from their average increase of 1.1% in the first three months of the year, as they rose 0.3% compared with March. Prices were up in 10 of the 27 census metropolitan areas (CMAs) surveyed, down in 1 and unchanged in the remainder of the CMAs from March to April.

Chart 1: New Housing Price Index

Record level of construction activity continues to push construction costs up
The Canada Mortgage and Housing Corporation reported that the quantity of houses under construction increased by 24.0% from the first quarter of 2020 to the first quarter of 2022 in Canada. The fourth quarter of 2021 and first quarter of 2022 have recorded the highest levels of residential construction activity on record. This rise in construction activity had impacts on construction costs, pushing up the prices of new homes.

According to the Building Construction Price Index, softwood lumber and labour shortages were strong drivers in rising construction costs in the first quarter of 2022. This was also echoed by many of the builders surveyed, who listed construction costs as the factor that was most frequently behind the latest price increase for new homes.

New home prices in the Prairie region are still on the rise
Regina (+1.7%) had the highest price appreciation in new homes among all of the surveyed CMAs in April on a month-over-month basis. Compared with the first quarter of 2020, the quantity of housing under construction in the first quarter of 2022 was up 46.6% in Saskatchewan, while employment in the construction industry increased by 8.7% over the same period. This level of growth in activity led to labour and material shortages, creating an upward pressure on construction costs within this province.

The second largest gain in the prices for new homes was registered in Calgary (+1.6%), supported by continuously tight inventory in the resale market. According to the Calgary Real Estate Board, the overall resale market has had less than two months of inventory since November 2021, while detached homes were at their lowest level of inventory seen in nearly 15 years.

Builders in Ottawa continued to report good market conditions as new home prices were up 1.5% on a month-over-month basis. According to the Ottawa Real Estate Board, in April, despite the falling sales and rising listings, the inventory of active listings remained below the one-month level. For comparison purposes, a balanced market has between four and six months of inventory.

The sole decline this month occurred in Montréal (-0.4%). According to the Quebec Professional Association of Real Estate Brokers, resale home sales continued to decline in April despite an increase in active listings for single family homes, indicating a softening market.

Year-over-year prices continue to rise across the country
Nationally, new home prices rose 9.4% year over year in April, the smallest growth since March 2021.

Winnipeg (+21.9%) reported the highest year-over-year increase among the 27 CMAs for the first time since June 2013.

The second highest increase was observed in Calgary (+21.7%), followed by Kitchener–Cambridge–Waterloo (+19.0%).

Chart 2: New house prices rise at the national level

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.

Products
The Technical Guide for the New Housing Price Index (NHPI) is available. This document provides details on the methodology used to calculate the NHPI.

The article titled "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 and compares the ranking of cities based on prices six months into the pandemic (August 2020 compared with February 2020).

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 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 May will be released on June 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; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).

Industry Intelligence Editor's Note: This press release omits select charts and/or marketing language for editorial clarity. Click here to view the full report.

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