Canada’s housing sector remained “moderately vulnerable” to market instability in the second quarter of 2021, according to a new report from the Canada Mortgage and Housing Corporation (CMHC).
CMHC’s quarterly assessment of the country’s housing market assigns low, moderate, and high ratings to metropolitan areas according to four key “imbalances” – overheating, price acceleration, overvaluation, and excess inventories.
This is the second straight quarter the housing agency rated the country’s housing vulnerability as moderate.
While the vulnerability of the housing sector of the country as a whole remained moderate, CMHC noted elevated “imbalances of concern” in several metros – with the markets of Toronto, Ottawa, Hamilton, Halifax, and Moncton showing a high degree of vulnerability due to continued evidence of overheating, price acceleration, and overvaluation in the first quarter of 2021.
Meanwhile, the housing markets of Vancouver and Montreal remained moderately vulnerable – and at the other end of the spectrum, the Prairie metros of Saskatoon, Regina, and Winnipeg saw low levels of vulnerability in the second quarter.
“The impacts of the ongoing pandemic continued to influence Canada's housing markets in the fourth quarter of 2020,” said Bob Dugan, chief economist of CMHC. “Strong housing market activity and price appreciation contributed to the emergence of new imbalances in some markets or contributed to the worsening of existing imbalances in already vulnerable markets.”
MBN
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