Home price index posts rare November decline

A key measure of changes in Canadian home prices has posted a decline for November.

The Teranet-National Bank National Home Price Index rarely posts a decline in November – it’s done so just 4 times in the 20 years – but it recorded a 0.3% decline from the previous month.

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Most markets declined with Quebec City, Halifax, and Victoria the exceptions.

It was the second consecutive monthly decline with tighter mortgage lending rules and a rise in interest rates among the factors that have cooled demand significantly in some markets.

In Vancouver, November was a fourth month in a row without a rise in home prices, for a cumulative drop of 1.8%; and in Toronto, prices declined over the last three months, for a total loss of 0.4%.

There are also weak markets in Alberta, where prices did not rise for a fifth month in a row in Calgary, and for a third consecutive month in Edmonton, for cumulative declines of 1.4% and 1.3% respectively.

The index for Victoria was flat while Halifax (0.1%) and Quebec City (1.2%) both gained.

The HPI tracks price changes based a percentage rise or fall from a value of 100 set in June 2005.

Annual increases

While down month-over-month, the national HPI was up 3.1% year-over-year; exacerbated by a sharp drop in the previous three months.

Victoria (5.3%), Ottawa-Gatineau (5.3%), Montreal (4.4%), Hamilton (4.4%), Vancouver (3.9%) and Toronto (3.3%) all posted above-national-average increases and there were smaller gains for Winnipeg (2.3%) and Halifax (1.7%).

Indexes were down year-over-year in Quebec City (−0.3%), Edmonton (−0.4%) and Calgary (−2.7%).

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