Canada Mortgage and Housing Corporation continues to fly the red flag it has unfurled over the country’s real estate market for a third consecutive quarter.
The latest Housing Market Assessment – which looks at 15 major centres across Canada – maintains that, overall, there is still strong evidence of problematic conditions. The agency cites on-going concerns about price acceleration and overvaluation. However, the number of markets labeled as highly problematic has dropped from six to five. Regina has been downgraded to moderate.
The biggest worries continue to centre on Toronto and the Greater Golden Horseshoe region, with strong evidence of price acceleration, overvaluation and overheating. Price growth is intensifying and demand is outpacing supply across the board in new homes, resales and rentals.
Price acceleration has pulled-back in Vancouver, but overvaluation remains a key concern and it appears to have spread. In Victoria evidence of overvaluation has increased from moderate to strong.
Montreal has had its overall evidence of problematic conditions downgraded from moderate to weak largely due to a better balance between home prices and economic fundamentals. Quebec City maintains its weak rating.
Calgary and Edmonton still rank as having moderate signs of problems based on concerns about overbuilding.