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File photo of a house for sale in Toronto.

The number of existing homes changing hands will pick up a bit next year, but the average selling price will rise by only 1.9 per cent in 2014, compared to four per cent this year, Canada Mortgage and Housing Corp. predicts.

Average prices can be influenced by changes in the types or locations of homes that are selling, and CMHC says the four per cent gain this year stems in part from increased sales in higher-priced markets.

Price growth next year is expected to be in line with inflation, with the average price of houses sold over the Multiple Listing Service in 2014 coming in at $385,200, compared to $378,000 this year, the Crown corporation says in its latest housing market outlook.

CMHC expects that the number of homes sold over the MLS this year will come in around 456,700, which is about the same as 2012, when 454,005 homes changed hands. It forecasts a rise in sales to 468,200 units next year, with sales rising in the first half of 2014 then moderating during the latter part of the year.

Sales have defied expectations this year. At the start of the summer nearly all economists were predicting a decline in sales for 2013, but the market has since rebounded.

Likewise, housing starts, while generally slowing, have been higher than anticipated. CMHC said Thursday it is anticipating starts to be stable next year, around 184,700 units, compared to 185,000 this year and 214,827 in 2012.

While factors such as employment growth and migration are continuing to support the housing market, "in the new home market, builders are nevertheless expected to limit the number of housing starts while inventories of unabsorbed units, completed and under construction, are drawn down," Mathieu Laberge, deputy chief economist of CMHC, said in a press release. "In the resale market, home buyers have been motivated to advance their purchases and lock-in pre-qualified mortgages given the recent moderate increase in mortgage rates. It is expected that existing home sales will increase modestly in 2014 with improving economic conditions."

It has been difficult to make accurate predictions about the Canadian housing market in recent years. The government has been taking steps to cool it off, and economists have been surprised by its resiliency.

In June CMHC was forecasting a 1.6 per cent increase in average prices this year and roughly 443,400 sales.

Its current forecast for starts is also slightly higher than in June, when it expected about 182,900 units to get under way this year.