Canada’s market for new homes remained red hot in June as housing prices rose at their fastest pace in more than 14 years, Statistics Canada said today.

Builders sought 6.2% more for homes compared with June 2003, the biggest 12-month gain since February 1990 when prices advanced 7.1%. “On a month-over-month basis, housing prices were up 0.7% from May,” StatsCan said.

“A favourable housing market along with higher prices for building materials such as lumber, drywall and steel, as well as increased labour costs, continued to push prices up nationally. Land prices also increased in 11 of the 21 metropolitan areas surveyed.”

Sixteen of 21 metropolitan areas surveyed registered monthly price increases.

In a separate release, Canada Mortgage and Housing Corp. said that housing starts fell to 218,700 on a seasonally adjusted projected annual basis in July, compared with 232,100 in June.

“Even though starts decreased slightly in July, housing construction remains at a high level,” CMHC economist David Weingarden said in a news release.

“Nationally, the housing market continues to benefit from positive economic factors, especially growth in employment and strong consumer confidence,” he said. “This year, 225,700 starts are expected, the highest level since 1987.”