Thursday, November 26, 2009

Teranet: September 2009 House Price Index

A smaller but still robust monthly rise

Canadian home prices in September were down 1.8% from a year earlier, according to the Teranet-National Bank National Composite House Price Index™. It was the tenth consecutive 12-month decline, but the 12-month decline has been diminishing steadily since it peaked at 6.9% in May. The reason is that September was the fifth straight month in which the index reading for Canada as a whole was up from the month before. The September monthly rise of 1.3% was the smallest in four months but still vigorous. The vigour is consistent with an improvement in market conditions over 2009 to date - more homes have been selling and fewer have been coming on the market.

Teranet – National Bank National Composite House Price Index™

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For the first time in three months, prices were down slightly from the month before in one of the six metropolitan markets surveyed, Montreal (−0.2%). This decline was not due to a deterioration of market conditions. According the Greater Montreal Real Estate Board, home sales were up from a year earlier in every month from May to October while new listings have declined. Toronto prices were up 1.5% from the month before, the smallest increase since the April bottom but still substantial. If October shows the same rise, Toronto prices will be back to their peak of August 2008. As for the other four markets, the September monthly rises were 2.1% in Vancouver, 1.1% in Calgary, 0.9% in Ottawa and 0.6% in Halifax.

The continuing 12-month deflation of the composite index (−1.8%) is attributable to three of the six markets: Calgary (−5.4%), Vancouver (−5.1%) and Toronto (−1.0%). In the other three markets, prices were up from a year earlier: Ottawa (3.4%), Montreal (2.9%) and Halifax (1.7%).

Teranet – National Bank House Price Index™

The historical data of the Teranet – National Bank House Price Index™ is available at

Metropolitan areaIndex level
September 2009
% change m/m% change y/y
Calgary154.321.1 %-5.4 %
Halifax123.580.6 %1.7 %
Montreal126.05-0.2 %2.9 %
Ottawa121.490.9 %3.4 %
Toronto115.541.5 %-1.0 %
Vancouver141.852.1 %-5.1 %
National Composite127.891.3 %-1.8 %

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

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.


Marc Pinsonneault
Senior economist
Economy & Strategy Group
National Bank Financial Group

Teranet - National Bank House Price Index™ thanks the author for their special collaboration on this report.

1 Value of Dwelling for the Owner-occupied Non-farm, Non-reserve Private Dwellings of Canada.

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