February 24, 2010 / 3:13 PM / 8 years ago

Canada resale home price index up for 8th month

TORONTO (Reuters) - Canadian home resale prices rose for an eighth straight month in December with overall prices rising to end the year at a record high, a report on Wednesday said.

The Teranet-National Bank Composite House Price Index, which measures price changes for repeat sales of single-family homes in six metropolitan areas, showed overall prices up 1.2 percent from November. The report did not provide actual prices.

Calgary, Montreal, Toronto, and Vancouver reported gains exceeding 1 percent in the month, while Ottawa showed a 0.4 percent rise. Halifax reported a 1.9 percent decline in December from the month before.

Encouraged by rock-bottom interest rates and rising consumer confidence, home sales and prices have been on a stunning rebound after grinding almost to a halt in the wake of the global financial crisis in late 2008.

“All in all, this report adds to the growing list of indicators pointing to a strong housing market in Canada, and underscores the view that Canadian home buyers are continuing to take advantage of the still favorable buying conditions, particularly given the very low mortgage rates,” said Millan Mulraine, an economics strategist at TD Securities.

Analysts say recent regulatory changes and anticipated interest rate hikes are likely to dampen activity in the second half of the year, but would-be home buyers look set to crowd into the market in the meantime.

Teranet’s year-over-year national measure showed prices were up 5.2 percent in December, twice the pace of November’s 2.6 percent advance.

The index tracks home prices over time for repeat sales, so properties with at least two sales are required in the calculations for the index.

Reporting by Ka Yan Ng; editing by Peter Galloway

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