Teranet House Price Index for June 2009

AUGUST 2009

A second consecutive monthly rise in June Canadian home prices in June were down 6.2% from a year earlier, according to the Teranet-National Bank National Composite House Price Index™. It was the seventh consecutive 12-month decline. The index is now down 6.8% from its peak of August 2008. However, it rose in both May and June after eight straight monthly declines. The June monthly rise was 1.5%. The turnaround is consistent with an improvement in market conditions in recent months for the country as a whole - more homes have been sold and fewer have been coming on the market. Teranet – National Bank National Composite House Price Index™ Contact Us For general enquiries: simon.cote@tres.bnc.ca For licenses covering all index-linked products, please contact: Simon Côté simon.cote@tres.bnc.ca 514 879-5379 Website www.housepriceindex.ca

Of the six constituent metropolitan-area indices, four showed monthly rises in June - Montreal (1.2%), Toronto (2.3%), Ottawa (2.1%) and Vancouver (1.6%). For Vancouver it was a first monthly rise after 11 consecutive declines. For Montreal it was a fourth straight monthly increase. In both Halifax and Calgary, June prices were down 0.2% from the month before. For Calgary it was the 12th consecutive monthly decline and the 19th in 22 months. Four of the six city indices were down from a year earlier - Vancouver (−10.7%), Calgary (−12.5%), Toronto (−5.6%) and Halifax (−0.4%). Montreal, up 2.4% from June 2008, is the only market that has yet to show a 12-month decline. Ottawa has shown a 12-month decline only once, in May of this year. The composite index is down 6.8% from the peak of August 2008. Toronto prices are now down 7.5% from their peak of the same month. Calgary is 15.4% below its peak of August 2007. Halifax and Ottawa show smaller declines from peak, 0.6% from November and 2.2% from October respectively. 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 June 2009 % change m/m % change y/y From peak Peak Date Calgary 148.31 -0.2 % -12.5 % -15.4% August 2007 Halifax 121.18 -0.2 % -0.4 % -0.6% November 2008 Montreal 124.02 1.2 % 2.4 % 0.0% June 2009 Ottawa 115.67 2.1 % 1.1 % -2.2% October 2008 Toronto 108.46 2.3 % -5.6 % -7.5% August 2008 Vancouver 134.59 1.6 % -10.7 % -10.7% June 2008 National Composite 121.89 1.5 % -6.2 % -6.8% August 2008 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. By: Marc Pinsonneault Senior Economist Economy & Strategy Team 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.

Disclaimer This monthly report, its layout and design as well as its content, including (without limitation) index data and related information and materials (“Index Data”) are protected by copyright law, both individually and as a collective work or compilation, and by trade-mark law, and other applicable laws. National Bank of Canada (“NBC”) and Teranet Inc. (“Teranet”) grant to you a limited non-exclusive, non-transferable license to view, copy and print this monthly report, provided that all copies that you make must be solely for your non-commercial, personal use, and must retain all copyright and other notices that are on this web site. Except as provided in the previous sentence, you may not (for either commercial or non-commercial use) use, distribute, sell, modify, transmit, revise, reverse engineer, republish, post or create derivative works (where applicable) of any content of this monthly report without the prior written permission of Teranet and National Bank (who are referred to collectively herein as the “Index Data Providers”. Without limiting the generality of the foregoing, the Index Data and other Index Data Provider intellectual property contained in this monthly report may not be used as a basis for any financial instruments or products (including, without limitation, passively managed funds and index-linked derivative securities), or used to verify or correct data in any other compilation of data or index, or used to create any other data or index (custom or otherwise), without the Index Data Providers’ prior written permission. You acknowledge and agree that you will not acquire any rights or licenses in the content of this monthly report. The Index Data is for informational purposes only, and the user of the information contained in the Index Data assumes the entire risk of any use made of the Index Data. You understand and agree that the Index Data is provided "as is" and neither National Bank of Canada (“NBC”) nor Teranet Inc. (“Teranet”, and together with NBC, the “Index Data Providers”) warrants the accuracy, completeness, non-infringement, originality, timeliness or any other characteristic of the Index Data. The Index Data is not an offer or recommendation to buy or sell or a solicitation of an offer to buy or sell any security or instrument or to participate in any particular trading strategy. Further, none of the Index Data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Reproduction, redistribution or any other form of copying or transmission of the Index Data without the Index Data Providers’ prior written consent is strictly prohibited. Without limiting the generality of the foregoing, the Index Data and other Index Data Provider intellectual property may not be used as a basis for any financial instruments or products (including, without limitation, passively managed funds and index-linked derivative securities), or used to verify or correct data in any other compilation of data or index, or used to create any other data or index (custom or otherwise), without the Index Data Providers’ prior written permission. In no event shall any of NBC, Teranet, their respective affiliates, any of their or their direct or indirect information providers nor any other third party involved in, or related to, compiling, computing or creating any of the Index Information (collectively, the "Index Data Provider Parties") have any liability to any person or entity for any damages, whether direct, indirect, special, incidental, punitive, consequential (including, without limitation, loss of use, lost profits or revenues or any other economic loss) arising in any manner out of your use or inability to use any of the Index Data contained in this monthly report, even if such party might have anticipated, or was advised or notified of, the possibility of such damages. The Teranet - National Bank House Price Index™ is an independently developed representation of the rate of change of Canadian single-family home prices. The measurements are based on the property records of public land registries. The monthly indices cover six Canadian metropolitan areas: Calgary, Halifax, Montreal, Ottawa, Toronto and Vancouver. The metropolitan areas are combined to form a Canadian composite index. In addition to their informational role, the Teranet - National Bank House Price Index™ was developed to be trustworthy benchmark for financial professionals. Teranet and NBC offer licenses covering all index-linked products. Teranet offers e-services to the legal, real estate, government, financial and healthcare markets. Combining our focus on customer needs with technical sophistication and operational simplicity, our comprehensive products and services include property information, transaction management, collateral risk management, geospatial information, workflow software and enterprise solutions. NBC is an integrated group which provides comprehensive financial services to consumers, small and medium-sized enterprises and large corporations in its core market, while offering specialized services to its customers elsewhere in the world. Asset management is an important component of the NBC's activities. In fact, NBC is a wealth management leader in Quebec. NBC's main priority is to satisfy the needs of its customers and build a long-term relationship of trust by offering personalized services and specialized savings, investment, financing and payment products through a vast network of branches and various electronic channels. It also offers corporate and investment banking services. NBC is an active player on international capital markets and, through its subsidiaries and other entities, is involved in securities brokerage, insurance and wealth management, as well as mutual fund and retirement plan management. Striving to be a good corporate citizen is another of NBC's priorities. In 2007, NBC and its subsidiaries, through corporate donations, sponsorships, in-branch fundraising activities and various benefit events, gave more than $20 million to hundreds of Canadian organizations working in health care, education, community outreach and arts and culture. National Bank Financial Inc. is an indirect wholly owned subsidiary of NBC. NBC is a public company listed on Canadian stock exchanges.