September 14, 2015 / 12:37 PM / 5 years ago

Canada home prices rise in August from July, up 5.4 percent on year

TORONTO (Reuters) - Canadian home prices rose in August from a month ago, the eighth straight monthly increase, to hit another record high as gains in key markets offset losses in others, the Teranet-National Bank Composite House Price Index showed on Monday.

A "For Lease" sign stands in front of a home in Toronto, Canada, June 29, 2015. REUTERS/Mark Blinch

The index, which measures price changes for repeat sales of single-family homes, showed national home prices rose 1 percent last month from July. They were up 5.4 percent from a year earlier, the largest year-over-year increase since November 2014.

While prices in six of 11 markets increased from July, several are coming back from earlier declines, meaning only Vancouver, Toronto, and Hamilton are at their peak.

Canada’s housing market has cooled in some regions after a boom that started in 2009, but hot demand in the largest and most expensive markets - Toronto and Vancouver - has kept national price measures at record levels.

Interest rates near historic lows have helped fuel demand but a prolonged decline in oil prices has hurt resource-dependent cities including Calgary. The Canadian economy was in a recession in the first half of 2015, though economists are broadly expecting positive growth in the second half of the year.

August’s gains were led by a 3.9 percent jump in Calgary, defying recent declines, a 2.4 percent gain in Hamilton and a 1.6 percent increase in Toronto. Prices in Ottawa, Vancouver and Winnipeg were all up by 0.6 percent.

Declines from July included a 1.1 percent slide in Quebec, a 0.5 percent drop in Edmonton and Montreal, a 0.4 percent dip in Halifax and a 0.3 percent slip in Victoria.

Year-over-year data show the two-speed nature of Canada’s housing market, with rampant price growth in key markets that have helped buoy an otherwise weakening housing picture.

Prices in Vancouver are were up 9.7 percent from August 2014, while Toronto prices were up 8.7 percent and Hamilton prices were 8.8 percent higher.

More modest annual gains included 0.7 percent in Calgary, 0.8 percent in Edmonton and 3.2 percent in Victoria.

Year-over-year declines in price were seen in five markets. Prices were down by 1.4 percent in Halifax, 0.5 percent in Montreal, 0.4 percent in Ottawa, 0.7 percent in Quebec and 0.4 percent in Winnipeg.

Editing by Nick Zieminski

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