National real estate prices were up 6.5% in September compared to a year earlier, but the increase was the smallest year-over-year increase since January, according to a monthly report released this week by the Canadian Real Estate Association (CREA).

The average price in September reached $352,600, below record level heights reached earlier this year. The largest year-over-year gains were in Newfoundland and Labrador, up 14% to reach $262,481 in September. Regina was up 13.1% to an average home price of $272,295, while Vancouver, the most expensive market, was up 10.5% to reach $751,042.

All Canadian major markets showed annual price gains in September. Calgary gained the least, up 1.7% for an average of $493,522.

Sales activity was up 2.7% nationally in September compared to August, while actual sales were up 11% compared to a year ago. New listings were up in markets such as Toronto, Montreal, Ottawa, Oakville and Vancouver, while drops were seen in Edmonton and the Fraser Valley.

The fact Canada’s market continues to show price growth and strong sales contrasts to what’s being seen elsewhere around the world, said CREA President Gary Morse.

“The Canadian housing market remains a bright spot against a backdrop of mixed headline news about the global economy,” he said. “Low mortgage rates continue to draw buyers to the housing market, while recently tightened mortgage regulations are working as intended.”

Sonya Gulati, an economist with TD Economics, said the factors of tighter lending rules, economic uncertainty, and growing saturation of first-time homebuyer activity has been balanced by the low mortgage rates throughout the year.

“Going forward, we anticipate a tug-of-war action to take hold in the Canadian real estate market between low interest and mortgage rates, and only most economic, income and employment growth,” said Gulati. “With both push and pull momentum, we expect both prices and sales to hold fairly steady, relative to current levels over the next year.”