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But fears that housing was due for a sharp correction remain unrealized as more than half of the local markets saw greater activity, and average home prices — while subject to regional variations — on average rose 2.5% from a year earlier to $378,532.

“The readings today suggest that the Canadian housing market is beginning to thaw out from its regulatory-induced freeze,” said TD Bank economist Sonya Gulati.

Still, Gulati added that she did not expect a rebound from the recent tumbles given that the economy is growing modestly, demand has waned and Canadians are dealing with record high debt levels.

Bank of Montreal chief economist Doug Porter noted that sales in the last four months are down 14% over the past year, but he too saw the slide moderating and that sales will likely only fall by seven per cent through 2013.

As for prices, they continue to defy both gravity and logic.

“It’s official, Canadian home prices are boring (and that’s a good thing),” Porter wrote in a note to clients. “Notably, all 26 cities reported a single-digit yearly change in prices in the past year, an unusually calm background. Moreover, all major home price measures are displaying unusual uniformity at present — the average and median price are both up between two and three per cent, as is the MLS Home Price Index, as is the new home price index.”

The consensus of economists is that home prices will likely fall about 10% in the next two years, with some believing the correction could be as high as 25%. But while home starts, future building intentions and resales have all fallen in the past year — and especially since Flaherty’s tightening action in July — prices remain stable.