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Canadian home sales rose in June at the fastest pace this year, led by a 17 per cent surge in Toronto, a sign the market may be regaining strength.

Transactions climbed 4.1 per cent from May after touching a five-year low, the Canadian Real Estate Association reported Monday from Ottawa. Benchmark prices fell 0.1 per cent on the month and advanced 0.9 per cent from a year earlier.

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Home sales had declined through most of 2018 after the government made it more difficult to get a mortgage and the central bank raised interest rates. Both measures constrained buyers, causing sharp declines in sales particularly for the most-expensive properties.

The market seems to be through the worst of that adjustment, at least for now. Bank of Canada policy makers said last week the housing market appears to be stabilizing.

The report is “in line” with what policy makers would want to see, which is “the market re-calibrating, if you will, and moving gradually higher,” Dawn Desjardins, assistant chief economist at Royal Bank of Canada, said by phone from Toronto. The strong job market is supporting demand, she said, though sales for 2018 will still decline because of weakness early in the year.