New house prices showing signs of flattening
The cost of a newly-built home in Alberta has come down from the peak reached last summer
By Rob Roach, ATB Economics 24 May 2023 1 min read
Statistics Canada’s monthly new housing price index indicates that the cost of a newly-built home in Alberta has come down from the peak reached last summer and has started to level off.
The provincial index rose to a record high of 118.4 in June 2022, but was down to 117.0 as of April 2023.
On a year-to-date (YTD) basis, the index for Alberta increased by an average of 3.5% over the first four months of 2023 compared to a much faster pace of 14.0% over the same period in 2022.
Within Alberta, we have data for the Calgary and Edmonton census metropolitan areas that show the housing markets in the two cities are on somewhat different tracks.
In Calgary, the new housing price index increased by an average of 5.4% over the first four months of 2023, down from 19.6% during the same period the year before.
In Edmonton, the year-to-date pace of price growth was also down from 2022, but was lower than in Calgary, falling from 8.1% to 1.0%.
Calgary’s index peaked at 125.3 last year compared to 110.8 in Edmonton.
Nationally, the average rise in the YTD index was 1.0% so far this year compared to 10.8% in 2022.
The average price of a new home in Canada and Alberta remains much higher than just two years ago, but the recent flattening of the indexes suggests that higher borrowing costs and generally weaker economic conditions are, at least for now, keeping a lid on the rapid price growth seen in 2021 and 2022.
Answer to the previous trivia question: The May long weekend is sometimes called "May two-four” because the holiday was originally held on May 24 and because two-four is a nickname for the 24-bottle cases of beer that are often involved in long weekend festivities.
Today’s trivia question: Alberta's Government House is located in Edmonton and was the official residence of the province's first six Lieutenant Governors. When was it built?