OTTAWA — The cost of new housing accelerated for the second straight month in January, the result of a strengthening housing market in the Atlantic and Prairie provinces.

Nationally, contractors' selling prices rose 6.5 per cent between January 2007 and January 2008.

Statistics Canada reports that prices were up 0.6 per cent from December.

Housing prices rose fastest in Saskatoon, with an annual price increase of 51.7 per cent and 4.5 per cent higher than in December.

The agency says the increase was due to increased costs for material and labour, as well as strong market conditions and increased demand for land.

In Regina, the year-over-year increase was 25.9 per cent and unchanged from December.