The average price of a home rose between 1.8% and 4.8% in the third quarter of 2012 compared to the same period last year, according to a survey by Royal LePage.
It says the cost of an average two-storey home in Canada increased 4% to $403,747, while detached bungalows rose 4.8% to $366,773.
Standard condominiums saw an increase of 1.8% to $243,607, and while most cities experienced modest price appreciation in the quarter, fewer homes were sold compared to the same period in 2011.
Royal LePage says fewer homes trading hands typically precedes a period of softening prices, and where there is reduced demand, home sellers adjust their asking price to stimulate interest.
Company president Phil Soper says changes to mortgage regulations, which took effect on July 9, accelerated the correction.
In July, the federal finance ministry said the maximum amortization period for insured mortgages would be reduced to 25 years from 30 years.
It was the fourth intervention in the mortgage market in just four years and the most influential. Potential first-time buyers, which in a typical market represent one third to one half of all purchase transactions, felt the changes immediately.
