New housing prices were 2.7 per cent lower in September 2009 than they were 12 months earlier, Statistics Canada said Thursday.

New house prices increased 0.5 per cent in September over August, Statistics Canada said Thursday. (CBC)

That's an improvement from the 3.1 per cent annual decline posted in August, but western Canadian markets continue to experience large year-over-year drops.

Prices have sunk by an average of 10.4 per cent in Victoria, 6.4 per cent in Vancouver, 11.4 per cent in Edmonton and 5.1 per cent in Saskatoon over the past year.

Among surveyed cities, the largest year-over-year increase was again registered in St. John's, at 7.5 per cent.

Monthly increases

On a monthly basis, contractors' selling prices rose 0.5 per cent in September, the largest month-over-month increase since January 2008.

The largest average monthly increase in the country was in the Vancouver market, at 1.4 per cent. Vancouver prices continued to increase as some builders moved to new phases of development, the data agency said.

The largest monthly decrease in new housing prices was a 0.7 per cent drop in Windsor, Ont.

Monthly declines were also observed in Greater Sudbury and Thunder Bay (down 0.5 per cent), Victoria (down 0.2 per cent) and Edmonton (down 0.1 per cent).