OTTAWA - Canadian new housing prices rose more than expected in July, climbing 0.4 per cent from June on continued strength in the hot market of Toronto, Statistics Canada data indicated on Thursday.

The monthly increase, the 16th in a row, was greater than the 0.2 per cent advance forecast by analysts in a Reuters poll.

Prices in the combined Toronto-Oshawa region, which accounts for 27.92 per cent of the Canadian market, rose by 1.0 per cent. Builders cited market conditions and prices on new listings as reasons for the increase.

Prices in Vancouver, another booming market, climbed 0.6 per cent. The rapid rise in prices in the two major cities have raised concerns that their markets are becoming overheated.

The new housing price index excludes apartments and condominiums, which the government says are a particular cause for worry and which account for one-third of new housing.