Persistent demand keeps new home prices climbing.
June 10, 2004 - Strong demand and high costs for labour and materials continued to drive up new home prices in Ottawa and across the country in April, Statistics Canada reported Thursday.
According to Statscan's New Housing Price Index, the selling price of a new home rose in 14 of the country's 21 largest metropolitan areas in April from March, with Ottawa-Gatineau logging the second-largest increase.
The local index rose to 145.9, up by 1.3 per cent from March and 6.6 per cent from a year ago.
The index uses a baseline of 100 set in 1997.
The biggest gainer on the month was Kitchener, up by 1.5 per cent to 124. Behind Ottawa-Gatineau was St. Catharines-Niagara, up by 1.2 per cent to 126, Toronto and Oshawa, up 1.1 per cent to 124.9, and Victoria, up 1.1 per cent to 103.7.
"A favourable housing market along with higher prices for inputs, such as building materials and labour, continued to push prices up nationally," Statscan said in its Daily Bulletin. "Land prices also increased in eight of the 21 metropolitan areas surveyed."
Compared to April 2003, the largest increases were seen in Victoria, up by 10.6 per cent to 103.7, Regina, up 7.2 per cent to 131.8 and Montreal, up 6.9 per cent to 133.5.
The overall national index rose to 121.7 in April, up by 0.7 per cent from March and by 5.6 per cent from a year ago. That's the largest year-over-year increase since March 1990 when the index rose by 5.7 per cent.
This spring has proven to be a good one for the local housing market, as steady consumer confidence and low interest rates prolong the housing boom that began several years ago during the tech bubble.
Earlier this week, Canada Mortgage and Housing Corp. reported that construction began on 640 new residential units in Ottawa last month, up by 28 per cent from May of last year and a slight gain from 638 in April. The total was the second highest for the month of May in the past 14 years.
Separately, Statscan reported that $97.92 million worth of residential building permits were taken out in Ottawa in April, up by 11.4 per cent from March.
Lastly, the Ottawa Real Estate Board reported that the resale market has also remained strong as buyers take advantage of low interest rates and a greater inventory on the market. OREB said 1,642 residential properties sold through the universally-used Multiple Listing Service in May, setting a new record for the month.
© Copyright 2003 The Ottawa Business Journal