Housing market still strong as Canadian new home prices rise again in October

OTTAWA – Prices of new homes in Canada rose for the 19th consecutive month in October, climbing by a faster-than-expected 0.2% from September on continued strength in Toronto and Montreal, Statistics Canada said on Thursday.Tyler Anderson/National Post files

Analysts had expected a 0.1% rise in the new housing price index.

Prices for new homes in the Toronto-Oshawa metropolitan region, which accounts for 26.6% of the entire Canadian market, rose by 0.3% in the month and were up 4.9% on the year.

The second highest year-on-year increase was in Winnipeg, Manitoba, where prices climbed 3.9% in the period.

Overall, new housing prices rose in eight of the metropolitan areas surveyed in October, were unchanged in eleven and down in two areas.

Prices in October increased by 2.4% from October 2011.

The Canadian government, which imposed tighter mortgage rules in July, and the Bank of Canada have long expressed concerns the housing market might overheat. Ottawa says it is too soon to judge the full effect of the new rules.

The new housing price index excludes condominiums, which the government says are a particular cause for concern.

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