* Canadian new home prices up for 18th month in a row
* Toronto, country's largest city, shows continued strength
OTTAWA, Nov 8 (Reuters) - Prices of new homes in Canada rose for the 18th consecutive month in September, increasing by 0.2 percent from August on continued strength in Toronto, the nation's largest city, Statistics Canada said on Thursday.
The advance matched analysts' expectations.
Prices for new homes in the combined Toronto-Oshawa metropolitan region, which accounts for 26.6 percent of the entire Canadian market, rose by 0.6 percent from August on market conditions and higher labor costs.
Overall, new housing prices increased in eight metropolitan areas, were unchanged in eight and fell in five. Prices in September increased by 2.4 percent from September 2011, unchanged from the year-on-year advance recorded in August.
The Canadian government, which imposed tighter mortgage rules this year, and the Bank of Canada have long expressed concerns the housing market might overheat. Ottawa says it is too soon to judge the full effect of the new rules.
The new housing price index excludes condominiums, which the government says are a particular cause for concern.