Home price index hits record high in July

Wed Sep 28, 2011 11:50am EDT
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TORONTO (Reuters) - Resale home prices rose to a record high in July, their eighth consecutive monthly gain, according to report on Wednesday that an analyst said signaled a gradual slowdown in a strong market.

The monthly report on 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 were up 1.3 percent in July from June.

Overall prices were up 5.3 percent from a year earlier.

Canadian house prices dipped during the recession, but bounced back quickly and have kept climbing, fueling talk of an overheated market, if not a housing bubble.

The index notched its fourth consecutive monthly increase of more than 1 percent in July. In contrast to the three previous months, however, prices did not rise in all six metropolitan markets surveyed.

Prices rose 2.3 percent in Calgary, 1.7 percent in Toronto, 1.0 percent in Ottawa, 0.9 percent in Vancouver and 0.5 percent in Montreal, while declining 0.9 percent in Halifax.

In five of the six metropolitan areas, prices were at record highs.

"As the numbers show, the dispersion of the monthly increases was very high," the report said. "Vancouver's July rise extended its string of consecutive monthly gains to 10, currently the longest run of monthly rises among the markets covered."

Analysts said, however, that the Teranet HPI report, along with the Canadian Real Estate Association's report of existing home sales for July, released on August 16, signal an orderly market slowdown.   Continued...

<p>A home is put up for sale in downtown Montreal, July 14, 2009. REUTERS/Shaun Best</p>