MNI DATA ANALYSIS:Canada New Hse Prices +0.2% Y/Y,Further Slow>

By Yali N'Diaye

     OTTAWA (MNI) - Canada's new housing prices were flat for the second 

consecutive month in September, lowering the 12-month growth rate to 

0.2%, the lowest since January 2010, Statistics Canada reported 

Thursday. 

     New house only prices edged down another 0.1% over the month, 

leaving the 12-month rate flat, the lowest since December 2009. 

     Land only prices edged up 0.1% in September after remaining steady 

in August, bringing down the 12-month gain to 0.4% from 0.6%, the lowest 

since November 2010. 

     The more comprehensive Teranet-National Bank National Composite 

House Price Index was also flat in September, but up 2.1% 

year-over-year. 

     Higher mortgage rates against the backdrop of a monetary policy 

normalization as well as more stringent mortgage financing rules have 

weakened demand for new homes. 

     However, Canada Mortgage and Housing Corporation reported Thursday 

that housing starts increased to a seasonally adjusted annual rate of 

205,925 units in October from 189,730 in September. That being said, the 

six-month trend decreased to 206,171 units from 207,809. 

     "The national trend in housing starts declined for a fourth 

consecutive month in October, which leaves the trend at its lowest level 

since February 2017," said CMHC Chief Economist Bob Dugan. 

     On a quarterly basis, new housing prices still managed to edge up 

0.2% in the third quarter on average from the second quarter, when they 

had contracted by 0.1%. 

     House only prices rose 0.2% in the third quarter, erasing the 

second quarter decrease, while land only prices continued to grow at a 

steady pace of 0.1%. 

     - VANCOUVER ACCELERATES M/M, SLOWS Y/Y 

     Regionally, prices declined in 12 metropolitan areas, were flat in 

eight areas, and increased in just seven areas on the month. 

     While prices remained flat in Toronto, they appreciated by 0.4% in 

Vancouver, more than erasing August's 0.2% decrease. 

     After discounts reported in previous months, builders in Vancouver 

returned to list prices, the report said. 

     On a 12-month basis, however, price growth in Vancouver continued 

to slow, reaching 0.6%, the slowest pace since May 2015. Year-over-year 

price gains have been diminishing since peaking at 9.1% in February this 

year. 

     Over the third quarter, prices in Vancouver contracted 0.1% after 

rising 0.1% in the second quarter. At the provincial level, prices in 

British Columbia decreased 0.1% in the third quarter despite a 0.2% gain 

in September. 

     Instead, prices in Ontario rose 0.3% in the third quarter, 

offsetting the previous quarter decline, although they remained flat in 

September. 

     In Toronto, prices were unchanged in September from August, but 

still down 1.2% from a year earlier. 

     After falling 0.9% in the second quarter, prices in Toronto 

recovered 0.1% in the third quarter. 

--MNI Ottawa Bureau; email: yali.ndiaye@marketnews.com

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