CMHC’s current Housing Market Assessment shows improving conditions in Winnipeg and Saskatoon, while Canada’s overall rating remains highly vulnerable.
Background on the assessment:
The Housing Market Assessment (HMA) compared the vulnerability of census metropolitan area (CMA) housing markets using data from the third quarter of 2017. Results are not incidental by housing type or neighbourhood. Rather, they show an assessment of the entire CMA.
The HMA assesses 4 factors that impacts housing markets:
- overheating of demand (when sales notably outdo new listings)
- price acceleration, which may partly reflect assumed activity
- overvaluation (when house prices are not fully backed by fundamental drivers such as earnings, mortgage rates and population)
- overbuilding, meaning an elevation in the rate of vacancies and/or the inventory of unsold newly construct units
Ratings levels for vulnerability are high, moderate and low. To actuate vulnerability, indicators for each factor are assessed for the following:
- the presence or incidence of signals of imbalances
- the intensity of these signals (how deep the indicator is from its historical average)
- the persistence of these signals over time
Some key results:
Results with persistent moderate to high ratings show the following:
- Overheating remained moderate in Victoria, Vancouver, Hamilton and Toronto. In Vancouver, demand for multi-family units remains elevated, largely due to their relative affordability in comparison to single-detached homes. Inventories of both new and resale multi-family units are at bordering all-time lows.
- Price acceleration remained moderate in Victoria, Vancouver, Hamilton and Toronto, and overall in Canada.
- Overvaluation remained high for Victoria, Vancouver, Hamilton and Toronto, and overall moderate in Canada. In Toronto and Hamilton, even with recent price adjustments, house prices are not fully supported by economic fundamentals such as personal disposable income and population growth.
- Overbuilding remained high for Edmonton, Calgary, Saskatoon and Regina. Both inventories of concluded and unsold and rental vacancy rates are above the verge of overbuilding.
Come and follow the team on Twitter at @teamleadingedge. Make sure to subscribe to Team Leading Edge to get newsletters on the Edmonton Real Estate market.
Note: Remember, you can access all our available Homes For Sale in Edmonton through our Edmonton MLS Listings page.
Subscribe and get the daily news, updates and latest trends in Edmonton real estate.