TORONTO (Reuters) - Canadian resale home prices rose sharply in June but the pace of 12-month price inflation slowed, the Teranet-National Bank Composite House Price Index showed on Monday.
The index, which measures price changes for repeat sales of single-family homes, showed home prices were up 0.9 percent nationally last month following a 0.8 percent increase in May.
Prices were up 4.4 percent from a year earlier, a deceleration from May’s 4.6 percent price gain. The report does not provide actual prices. Canada’s housing market has shown strong growth this spring and early summer after brutal winter weather hurt construction, sales and prices. Most analysts expect the market to carry some momentum through 2014 before slowing in 2015, when interest rates are expected to rise.
“At risk of sounding like a broken record, there are reasons to believe that the housing market will eventually cool down in 2015,” Mazen Issa, senior Canada macro strategist at TD Securities, said in a research note.
“Supply in some markets are elevated, so this should constrain the pace of home price appreciation.”
The Teranet data showed that prices rose in seven of 11 markets in June from May, led by a 3.1 percent gain in Hamilton and a 2.8 percent rise in Montreal. Gains also included a 0.9 percent rise in Calgary, a 1.1 percent gain in Edmonton, a 0.5 percent increase in Ottawa, a 1.4 percent rise jump in Toronto and a 1.8 percent rise in Victoria.
Prices fell in the month in four cities: a 1.2 percent decline in Halifax, a 0.4 percent decrease in Quebec City, a 1.0 percent fall in Vancouver and a 0.6 percent drop in Winnipeg.
Year-over-year price gains were also seen in seven of the 11 markets surveyed. Prices were up 8.1 percent in Calgary, 7.3 percent in Hamilton, 6.1 percent in Toronto and Vancouver, 3.5 percent in Edmonton, 1.6 percent in Victoria and 1.0 percent in Montreal.
Compared with a year earlier, prices were down 2.5 percent in Halifax, 1.7 percent in Ottawa, 2.4 percent in Quebec City and 0.4 percent in Winnipeg.
Reporting by Andrea Hopkins; Editing by Chizu Nomiyama; and Peter Galloway