Newly built Canadian homes are rising faster in price than at any time in more than three decades.

Prices rose 1.9 per cent in February from the previous month, according to data released Thursday by Statistics Canada, the fastest one-month increase since 1989.

Canada might be in one of the biggest housing bubbles of all time: David Rosenberg

The Bank of Canada is holding its overnight lending rate unchanged at 0.25 per cent. The central bank says it will keep rates on hold until its inflation objective is sustainably achieved. David Rosenberg, chief economist and strategist at Rosenberg Research, provides his reaction. He doesn't see rates moving for years - even beyond 2023. He also says that Canada might be in one of the biggest housing bubbles of all time.

The data confirm that the country’s housing markets are running at a red-hot pace, with record low interest rates, scant inventory and demand for more space pushing up sales activity and prices to new highs.

“The continued strength in new housing prices may be an obstacle for some potential buyers to secure a new home. As prices increase, the purchase of a house will become less affordable as bidding wars continue to overheat an already active market,” the Statistics Canada report said.

Vancouver’s new-home prices led the gains, rising 4 per cent, but increases were widespread across the country, with prices up in 22 of 27 cities. On the year, new home prices rose 7 per cent.

The data cover new single homes, semi-detached homes and town homes but not condominiums.