Conditions in Canada’s housing markets are showing some signs of improvement, but Canada Mortgage and Housing Corp. (CMHC) continues to warn of “strong evidence of problematic conditions.”
CMHC’s quarterly Housing Market Assessment reports offer both expert and impartial insight and analysis, based on the best data available in Canada. This report acts as an early warning system for the country’s housing markets – an important tool supporting financial and housing market stability.
- Strong evidence of problematic conditions
- Evidence of overvaluation at the national level has been downgraded from strong to moderate. It is now present in six centres instead of eight.
- Evidence of overvaluation has increased from a moderate rating to strong in Victoria, as fundamentals are not keeping up with higher prices. There is also moderate evidence of price acceleration and overheating, leading to strong overall evidence of problematic conditions.
- Conditions have improved in Regina, Montréal and Québec relative to home prices.
- Overbuilding has from to six centres, from the previous eight.
- In Moncton and St. John’s, the supply of homes is adjusting to the demand.
- Toronto and Hamilton continue to face price acceleration, overvaluation and overheating. Price growth has intensified and demand is outpacing supply in the rental, resale and new home markets.
- Vancouver’s housing market continues to show strong evidence of problematic conditions due to moderate evidence of price acceleration and strong evidence of overvaluation.
- Markets in the Prairies continue to show moderate to strong evidence of overbuilding.
CMHC defines “problematic conditions” as imbalances in the housing market. Imbalances occur when overbuilding, overvaluation, overheating and price acceleration – or combinations thereof – stray significantly from historical averages.