January 13, 2016 / 4:07 PM / 2 years ago

UPDATE 1-Canada home prices see first drop in a year, Calgary worst hit

(Adds regional detail, background)

TORONTO, Jan 13 (Reuters) - Canadian home prices fell in December from a month earlier, the first monthly decrease in a year, as gains in Toronto and Vancouver were unable to offset weakness elsewhere, the Teranet-National Bank Composite House Price Index showed on Wednesday.

The index, which measures price changes for repeat sales of single-family homes, showed national home prices fell 0.1 percent last month from November.

The report showed prices were flat or down in seven of the 11 markets surveyed, led by a 1.7 percent drop in Calgary, where slumping oil prices have sideswiped Canada’s energy heartland.

Prices were also down in the month by 1.5 percent in Winnipeg, 1.4 percent in Ottawa, 1.3 percent in Montreal, 0.6 percent in Hamilton and 0.3 percent in Edmonton.

Prices were flat in Victoria.

The weakness was offset by Toronto and Vancouver, which saw gains as usual, as well as Halifax and Quebec City.

The nation’s two largest markets have defied forecasts for a slowdown or price correction for years. Prices were up 1.1 percent in Vancouver in December - the 12th straight month without a decline - while Halifax prices rose 1.5 percent, Quebec City was up 0.5 percent, and Toronto prices edged up 0.2 percent, the 10th consecutive month without a decline.

While low prices for oil and other commodities have hit Canada’s export-driven economy hard, Toronto and Vancouver have managed to keep the national housing market in positive territory for much of 2015. Economists are divided over whether prices there will see a U.S. style correction or merely plateau in 2016 as the economy limps along.

Teranet said prices were up 6.2 percent from a year earlier, led by a 12.9 percent gain in Vancouver, a 9.5 percent rise in Toronto, an 8.8 percent rise in Hamilton and an 8.7 percent gain in Victoria. Prices were up a more modest 2.6 percent in Halifax, 0.4 percent in Montreal and 0.2 percent in Quebec City.

Prices were down from a year earlier by 2.6 percent in Calgary, 1.1 percent in Edmonton, 2.1 percent in Ottawa and 1.1 percent in Winnipeg, the report showed. (Reporting by Andrea Hopkins and Jeffrey Hodgson; Editing by Chizu Nomiyama)

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