MNI DATA ANALYSIS:Toronto Drags Down Canada New House Prices>

--February New Housing Price Index -0.2% M/M, +2.6% Y/Y

By Yali N'Diaye

     OTTAWA (MNI) - Canada new housing prices decreased 0.2% in February 

after being flat in January, marking the first decline since July 2010 

and the largest since June 2009, Statistics Canada reported Thursday. 

     More stringent mortgage rules since January this year and higher 

mortgage rates likely contributed to the price decline, providing the 

Bank of Canada with an early assessment of how the economy, and housing 

prices in particular, is responding to tighter monetary policy. 

     On a 12-month basis, prices appreciated 2.6%, the smallest increase 

since July 2016, following a 3.2% appreciation in January. National 

prices had been hovering between 3.0% and 3.9% since October 2016. 

     House only prices fell 0.3% on the month, the largest drop since 

April 2009, for a 12-month gain of 2.7% after rising 3.3% in January. 

     Land only prices edged up 0.1% after remaining flat the previous 

month, and rose 2.9% year-over-year, down from 3.3% in January. 

     --TORONTO 'UNFAVORABLE' CONDITIONS 

     While 7 metropolitan areas recorded monthly decreases in February, 

Toronto, which represents 27.9% of the index, was the main reason behind 

the national price decline, with builders citing  "unfavorable market 

conditions" in the area. 

     Prices in Toronto fell 0.6% after edging down 0.1% in January, 

marking the largest decline since February 2010, for a 12-month gain of 

2.8% after 4.4% in January, the smallest increase since May 2015. 

     At the provincial level, prices in Ontario were down 0.3% after 

rising 0.1% in January, with the 12-month rate declining to 3.2% from 

4.3%. 

     In Vancouver, on the other hand, prices remained steady once again 

in February, although they continued to accelerate on a 12-month basis 

to 9.1%, the largest increase since September 2017. 

     The province of British Columbia introduced additional regulations 

in February, and it is likely too early to be reflected in this month's 

data. 

     Prices in British Columbia were stable in February and January, 

with the 12-month rate edging down to 7.8% from 7.9%.

--TERANET PRICES SOFT 

     Meanwhile, the more comprehensive Teranet - National Bank Composite 

House Price Index was flat in March, the National Bank reported 

Thursday. This was the "first time outside a recession when the March 

composite index was not up at least 0.2 percentage points from 

February," the report said, suggesting price softness could continue in 

March. 

     On a 12-month basis, the price index rose 6.6%, the smallest gain 

since May 2016 and a ninth consecutive deceleration. 

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

[TOPICS: MACDS$,M$C$$$]