The price of new homes fell 0.1 per cent in July after a 0.1 per cent increase in June -- the first drop in more than a year, according to Statistics Canada's latest report.

The agency's New Housing Price Index released Tuesday lists Vancouver, London and Greater Sudbury and Thunder Bay, Ont., as the top contributors to the decline.

Between June and July, prices decreased most in Greater Sudbury and Thunder Bay, which dropped 1.9 per cent; London, down 1.8 per cent; and Windsor, Ont., which fell 1.5 per cent.

Meanwhile, construction on new housing units fell 3 per cent between July and August, according to the Canada Mortgage and Housing Corporation. The seasonally adjusted rate of housing starts was 183,300 units in August, compared with 188,900 in July, the organization reported Thursday.

"Housing starts moved lower in August, reflecting a decrease in both single and multiple starts," Bob Dugan, chief economist at CMHC's Market Analysis Centre, said in a statement.

Statistics Canada attributes the slump in new home prices in part to the introduction of the Harmonized Sales Tax, which isn't included in the index's calculations.

Prices rose in three of the 21 cities examined. The largest increase occurred in Kitchener-Cambridge-Waterloo, Ont., where they climbed 0.6 per cent as builders raised their prices.

The index was up 2.9 per cent year-over-year in July, following a 3.3 per cent rise in June.