Canada New House Prices Fall 0.2% in November – MarketWatch

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By Robb M. Stewart

OTTAWA–New-house prices in Canada slipped again last month, adding to signs the housing market is under pressure after rebounding earlier in the year.

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Statistics Canada’s new-house price index fell 0.2% in November from the month before, after edging down 0.2% in October. It is the third month in a row that the index has lost ground.

From a year earlier, prices for the month were down 0.9% as the majority of housing markets across the country reported lower prices, the data agency said.

Canada’s housing market has struggled in recent months. Sales of existing homes declined 0.9% last month and benchmark house prices–calculated in a similar fashion to the S&P CoreLogic Case-Shiller National Home Price Index–fell 1.1% from the previous month, data released last week by the Canadian Real Estate Association showed. Housing starts across the country slumped 22% in November from the month before to the lowest level in six months, according to Canada Mortgage and Housing Corp.

In a speech late last week, Bank of Canada Gov. Tiff Macklem highlighted progress made in tackling inflation but affirmed it was too soon to be discussing rate cuts given a lack of evidence inflation is sustainably on a track back to the central bank’s 2% target from 3.1% currently. The central bank earlier this month left its policy interest rate at a 22-year high of 5%.

Statistics Canada said new house prices were down or unchanged from the month before in 25 of the 27 metropolitan areas surveyed by the agency. Many builders in the 15 areas where new home prices declined in November were offering different types of incentives, such as design credits and rebates, to encourage sales.

The new-house price data from Statistics Canada covers single-dwelling, semi-detached and row houses. It doesn’t incorporate prices for newly built condominium units.

Write to Robb M. Stewart at [email protected]

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