UPDATE 1-Canadian house prices fall 0.4 pct in November from Oct -Teranet
* Prices up 3.3 pct from year ago, deceleration trend continues
* Prices down in November from October in 10 of 11 markets
* Calgary records the only monthly price gain
TORONTO, Dec 19 (Reuters) - Canadian home prices dipped in November from October while year-over-year price gains slowed for the 12th straight month as Canada's housing market continued to cool, the Teranet-National Bank Composite House Price Index showed on Wednesday.
The index, which measures price changes for repeat sales of single-family homes, showed overall prices fell 0.4 percent in November from a month earlier, the third consecutive monthly decline.
"For the first time since February 2009, when the recession was in full swing, prices were down from the month before in 10 of the 11 metropolitan markets surveyed," with Calgary the only city to escape a drop, Teranet noted in its report.
The index was up 3.3 percent from a year earlier, the 12th consecutive month of deceleration in 12-month inflation.
The report is the latest in a string of data suggesting that an extended Canadian upswing in house sales and prices has come to an end, but activity varies widely by region.
Canada's housing market avoided a meltdown in the wake of the financial crisis in 2009, h elped by the country's co nservative lending standards. Ul tra-low interest rates then helped fuel a post-crisis boom.
Canadian housing is now swooning just as the U.S. market is showing some signs of a long-awaited r ecovery.
Canada 's Conservative government tightened mortgage lending rules to make it harder for homebuyers to take on too much debt in a bid to slow the nation's red-hot housing market. The changes, which took effect in July, were the fourth such move in four years.
CRASH OR SOFT LANDING?
With cooling evident in Vancouver and several other major cities, speculation has turned to whether the slowdown will be a soft landing or a crash. Tighter mortgage lending rules have put the brakes on some segments of the market, but interest rates are expected to remain at historically low levels through 2013, which may help temper the slowdown.
Mazen Issa, Canada Macro Strategist at TD Securities, said he expects the correction in house prices to continue in the months ahead, but noted the housing market tends to bounce back after adjusting for changes in lending conditions.
"The correction in Vancouver is already well advanced and we believe Toronto - which has been the market holding up the national index - will soon follow. Overall we expect to see prices to correct by 10-15 percent over the next 2-3 years," Issa said in a research note.
"As we have noted before, after an initial adjustment period, the housing market tends to reaccelerate. This risk is nontrivial given the very accommodative interest backdrop, one which is expected to persist through most of next year," he said.
The report showed prices dropped in November from October in 10 of the 11 metropolitan markets surveyed, led a 0.9 percent decline in Victoria, Halifax and Edmonton, a 0.7 percent decline in Winnipeg and a 0.6 percent decline in Vancouver.
Other cities saw monthly price declines as well. Prices dropped 0.5 percent in Ottawa, 0.4 percent in Montreal, 0.3 percent in Toronto and Hamilton, and 0.1 percent in Quebec City.
The only market that recorded a price increase in the month was Calgary, where prices were up 0.4 percent from October.
Year-on-year prices dropped 1.7 percent in Victoria and 1.4 percent in Vancouver, but were higher in all of the other markets. Toronto prices were 6.3 percent higher than a year earlier, while prices were up 7.3 percent in Halifax, 7.2 percent in Hamilton, 5.7 percent in Calgary, 5.2 percent in Winnipeg, 2.8 percent in Montreal, 2.7 percent in Quebec City, 2.2 percent in Ottawa, and 1.6 percent in Edmonton.
The index, which is similar to the U.S. S&P/Case-Shiller home price index, tracks repeat sale prices, so properties with at least two sales are required in the calculations. It lags other home resale data by about six weeks.