Teranet House Price Index - January 2012

JANUARY 2012

CANADIAN HOME PRICES DOWN 0.2% IN NOVEMBER Canadian home prices in November were down 0.2% from the previous month, according to the Teranet-National Bank National Composite House Price Index™. The retreat came after two months in which prices had been flat from the month before, and is the first in the index since a brief correction during the three months ending November 2010. Prices were down in eight of the 11 metropolitan markets surveyed, one more than in October. Calgary and Victoria stood out with declines of 1.6% and 0.9% respectively. The deflation was much smaller in the other six markets: 0.3% in Hamilton, 0.2% in Vancouver, Toronto, Ottawa and Quebec City, 0.1% in Winnipeg. Prices were up from the previous month in Edmonton (0.1%), Montreal (0.4%) and Halifax (0.5%). The simultaneous monthly declines in Toronto, Hamilton and Winnipeg are noteworthy in that these three markets are considered tight. Teranet – National Bank National Composite House Price Index™ Contact Us For general enquiries: info@housepriceindex.ca For licenses covering all index-linked products, please contact: Simon Côté 514 879-5379 Website www.housepriceindex.ca

The 12-month gain of the composite index in November was 7.1%, a slight acceleration from 7.0% in October. However, the acceleration was due entirely to the base effect of a larger price decline (−0.4%) from October to November of the previous year. Since prices began rising again in December 2010, the recent acceleration trend in 12-month changes could come to an end with next month's report on December 2011 prices. The November 12-month change varied widely among the country's major markets: 10.8% in Toronto, 9.1% in Vancouver, 7.5% in Winnipeg, 7.2% in Montreal, 6.0% in Quebec City, 4.4% in Hamilton, 4.2% in Ottawa-Gatineau, 2.8% in Halifax, 1% in Hamilton, 0.5% in Calgary. Victoria prices were down 0.3% from a year earlier. In December, the seasonally adjusted ratio of new listings to sales (as reported by CREA) showed market conditions generally balanced in the country as a whole. The exceptions were tight markets in Toronto, Hamilton and Winnipeg and a buyer's market in Victoria. Teranet – National Bank House Price Index™ The historical data of the Teranet – National Bank House Price Index™ is available at www.housepriceindex.ca. Metropolitan area Index level November % change m/m % change y/y Calgary 153.81 -1.6 % 0.5 % Edmonton 163.65 0.1 % 1.0 % Halifax 131.32 0.5 % 2.8 % Hamilton 130.41 -0.3 % 4.4 % Montreal 144.43 0.4 % 7.2 % Ottawa 137.71 -0.2 % 4.2 % Quebec 165.69 -0.2 % 6.0 % Toronto 138.55 -0.2 % 10.8 % Vancouver 169.81 -0.2 % 9.1 % Victoria 140.64 -0.9 % -0.3 % Winnipeg 179.23 -0.1 % 7.5 % National Composite 6 148.14 -0.2 % 8.0 % National Composite 11 149.11 -0.2 % 7.1 % The Teranet–National Bank House Price Index™ is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index. This is known as the repeat sales method; a complete description of the method is given at www.housepriceindex.ca The Teranet–National Bank House Price Index™ is an independently developed representation of average home price changes in six metropolitan areas: Ottawa, Toronto, Calgary, Vancouver, Montreal and Halifax. The national composite index is the weighted average of the six metropolitan areas. The weights are based on aggregate value of dwellings as retrieved from the 2006 Statistics Canada Census. According to that census1, the aggregate value of occupied dwellings in the metropolitan areas covered by the indices was $1.168 trillion, or 53% of the Canadian aggregate value of $2.207 trillion. All indices have a base value of 100 in June 2005. For example, an index value of 130 means that home prices have increased 30% since June 2005.