Canadian new home prices increase 0.5 percent in August

Monday, 21 September 2020 21:21:04 (GMT+3)   |   San Diego

According to Statistics Canada, prices for new homes increased for the fourth consecutive month, rising 0.5 percent nationally in August. This marked the largest monthly increase for new home prices at the national level since May 2017. New home prices rose in most of the 27 census metropolitan areas (CMAs) on increasing demand for single-family homes and higher building material costs in the wake of the pandemic. With physical distancing measures still in place, some homeowners chose to divert their summer vacation funds towards renovations and home improvements.

At the national level, new house prices rose 2.1 percent during the 12-month period ending in August—the largest year-over-year increase since March 2018.

In the short term, it is expected that the shortage of lumber and building supplies will persist due to the uptick in homebuyer demand, the increased renovation activities in North America, as well as the lingering effects of the reduced operations at sawmills earlier this year. These factors will continue to put upward pressure on new house prices. Homebuilders say that the record high lumber prices this year will most likely add an extra $5,000 to $10,000 to the cost of a single-family house.

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