Tracking the rise in new home prices
The price of a new home in Alberta increased by 21.1% between February 2020 and July 2022
By Rob Roach, ATB Economics 23 August 2022 1 min read
Last week, we looked at how the benchmark prices of existing homes on the resale market have been changing. Today, we zero-in on the cost of new homes.
According to Statistics Canada’s New Housing Price Index, the price of a new home in Alberta increased by 21.1% between February 2020 (the month before the pandemic was declared) and July 2022. The price increased by 28.4% in Calgary compared to a more modest 13.3% in Edmonton.
We have to use caution when comparing the two datasets due to methodological differences, but it appears that the increases in Calgary and Edmonton are roughly in line with what has been happening in the resale market with the benchmark price in Calgary up by 24.6% between February 2020 and July 2022 and by 16.3% in Edmonton. (The MLS® Home Price Index does not include a province-wide resale price benchmark for Alberta.)
This is, however, not the case everywhere with the rise in resale prices since February 2020 much larger than the rise in the New Housing Price Index in some markets.
For example, the New Housing Price Index in Toronto was up by 12.8% versus 45.3% for the resale benchmark. Similarly, it was 21.9% versus 49.5% in Victoria and 17.8% versus 69.6% in Halifax.
As always with real estate data, a lot depends on which particular market you are talking about (not to mention the specific characteristics of individual properties).
Answer to the previous trivia question: The Eaton’s department store chain went bankrupt in 1999.
Today’s trivia question: Which palace serves as the main residence of Queen Elizabeth II?