New housing prices climb at slowest pace since 1999

New home prices increased 1.5 per cent on an annual basis in October, the smallest increase recorded since October 1999, Statistics Canada said Thursday.

At the same time, the apartment vacancy rate in October fell to 2.2 per cent from 2.6 per cent, the Canada Mortgage and Housing Corporation said in a separate report Thursday. The CMHC said the gap between home ownership and renting in part increased demand for rental units.

According to Statistics Canada report, prices for new homes declined 0.4 per cent between September and October 2008 — marking the first monthly decrease observed since September 1998, the federal agency said.

Regina and St. John's led the country with annual increases of 22.8 per cent and 22.3 per cent respectively — though the rate of increase was down from record highs reached earlier this year.

Year-over-year increases were also recorded in the following cities:

Ottawa (4.3 per cent).Toronto and Oshawa (3.0 per cent).Quebec City (5.8 per cent).Montreal (4.8 per cent).

Contractors' selling prices for new homes in Edmonton declined 7.7 per cent in year-over-year comparisons — the city's largest decline recorded since May 1985. Calgary saw a yearly decrease of 1.6 per cent, the city's largest year-over-year decline since November 1991. Year-over-year prices also fell in Vancouver by 0.4 per cent and in Victoria by 1.1 per cent.

According to the CMHC report, the urban centres with the lowest vacancy rate were Kelowna at 0.3 per cent and Victoria, Vancouver and Regina all at 0.5 per cent. Windsor at 14.6 per cent, St. Catharines-Niagara at 4.3 per cent and Oshawa at 3.2 per cent had the highest vacancy rates in the country.

The highest average monthly rent for two-bedroom apartments was highest in Toronto at $1,625. Vancouver at $1,507 and Calgary at $1,293 followed.