UPDATE 2-Canada's Teranet home price index rises in June

* Biggest monthly gain since August 2009

* Up 13.6 pct from year earlier

* At odds with other housing data that has shown cooling

* Conference Board says home building activity to slow (Adds Conference Board construction report)

TORONTO, Aug 25 (Reuters) - Canadian home resale prices rose again in June, posting their biggest monthly gain in 10 months, but are likely to start falling in the near future.

The Teranet-National Bank Composite House Price Index, released on Wednesday, showed overall prices rose 1.5 percent in June from May, the largest monthly rise since last August and the composite's 14th straight monthly increase.

It was also the third straight month that prices gained across all six metropolitan areas surveyed by Teranet.

Prices were up 13.6 percent from a year earlier, an identical gain to May's year-over-year advance.

Teranet said it was "too early to conclude that the relatively vigorous prices rises" of the past three months constituted a trend. Indeed, the data contrasts with recent numbers showing a clear cooling in the market, from housing starts to existing home sales.

"June marks the largest monthly increase in 10 months. But we do not believe that acceleration in the Teranet-National Bank index will be sustained," Marc Pinsonneault, senior economist at National Bank Financial, said in a research note.

"The number of existing homes sold has declined in each of the four months ending last July, and it did so to a proportionally larger extent than the number of new listings."

Sales of existing homes in Canada fell 6.8 percent in July, further evidence that the country's recently hot housing sector is no longer playing a starring role in the economic recovery. [ID:nN16264769]

But Canada's housing performance is still more buoyant than that of the United States, which posted a 15-year low in existing home sales in July.

In a separate report, the Conference Board of Canada said the pace of home construction activity in the second half of the year would shift to a "more sustainable building pace rather than the beginning of a large correction in demand."

But profits are expected to fall, partly because of higher costs for labor and wood products.

TERANET LAGS, BUT HAS METHODOLOGICAL MERITS

Market analysts say the Teranet report, which is Canada's answer to the closely monitored U.S. S&P/Case-Shiller home price index, lags by at least four months the monthly existing home sales data as measured by the Multiple Listing Service (MLS) from the Canadian Real Estate Association.

"The weakness in MLS prices that began to occur in May could take until at least the September Teranet report for it to show up there, which we won't receive until November," Scotia Capital's Derek Holt and Gorica Djeric said in a commentary.

"On balance, the MLS price figures are not perfect but are a much more timely gauge of house price activity than the Teranet measure, despite the latter's methodological merits," they wrote.

The Teranet index tracks home prices over time for repeat sales, so properties with at least two sales are required in the calculations. The report did not provide actual prices.

Teranet said Ontario markets claimed the heftiest month-on-month rise for price changes on repeat sales of single-family homes. Ottawa was up 2.7 percent from May, followed by Toronto, up 2.4 percent. Halifax gained 1.3 percent, while Montreal advanced 1.4 percent.

Western Canadian markets posted the smallest gains among the group, with Calgary rising 0.2 percent and Vancouver up 0.8 percent.

The report said the prospect of new sales tax regimes that took effect in July in Ontario and British Columbia probably stimulated sales in Vancouver, Toronto and Ottawa in the preceding months. (Reporting by Ka Yan Ng; editing by Rob Wilson)