Canada’s Housing Market Remains at Moderate Degree of Vulnerability

Weakening housing market fundamentals and an increase in average overvaluation estimates in the second quarter of 2020 have led to Canada’s housing market retaining a moderate degree of vulnerability. This analysis is according to the Canada Mortgage and Housing Corporation (CMHC) Housing Market Assessment (HMA) released today.

Results are based on data as of the end of June 2020 (annual rental apartment vacancy rates are from October 2019) and market intelligence up to the end of August 2020. This national report provides the housing market assessment at the national level and detailed results for 15 Census Metropolitan Areas (CMAs).

The last HMA was released in February, shortly before the COVID-19 pandemic led to significant and rapid changes in the economy. Due to the swift evolution of the situation and unprecedented level of uncertainty, the HMA was suspended until relevant and timely data were available again.

To ensure timely information, the overvaluation framework in this edition relies on preliminary estimates of some fundamental drivers of the housing market in the second quarter of 2020. Final calculations and ratings for overvaluation will be presented in the next HMA as finalized data for these fundamental drivers becomes available. The attached backgrounder also provides additional information.

While the HMA framework still focuses on the same key factors in assessing the degree of housing market vulnerability (overheating, price acceleration, overvaluation and overbuilding), there exists a wider range of housing market vulnerabilities in the context of the COVID-19 crisis. The HMA nonetheless remains useful to keep the pulse of housing markets in Canada and to continue monitoring potential imbalances.

Highlights:

  • The COVID-19 pandemic has affected all regions of the country.
  • Prior to the second quarter of 2020, Vancouver and Toronto were experiencing a general unwinding of housing market imbalances.
  • Vancouver and Toronto saw an increase in observed house prices in the second quarter of 2020 despite the COVID-19 driven decline in their estimated fundamental house prices. This has led to an increase in average overvaluation estimates in both housing markets.
  • The OttawaMoncton, and Halifax housing markets are all now assessed at an overall moderate degree of vulnerability.
  • OttawaMontréalMoncton, and Halifax entered the second quarter of 2020 with emerging imbalances in their respective housing markets.
  • Observed house prices in all four CMAs had been growing prior to the onset of COVID-19 and continued growing in the second quarter, despite the general weakness in housing market fundamentals.
  • This has led to the detection of moderate evidence of overvaluation in Moncton and Halifax while a sustained increase in the rate of house price growth has led to the signaling of price acceleration in Ottawa and Montréal.
  • The COVID-19 pandemic and downward pressure on oil prices further aggravated Edmonton and Calgary’s recent economic challenges.
  • House prices in these Prairie centres fell in the second quarter of 2020. The rate of decline is below what can be explained by housing market fundamentals alone. This has led to an increase in average overvaluation estimates in both housing markets between the first and second quarters of 2020.
  • Evidence of overbuilding that was first detected in 2015 is still present in both markets.


Comparisons between the February 2020 and September 2020 reports
 OverheatingPrice AccelerationOvervaluation*OverbuildingOverall Assessment
  Feb. 2020Sept. 2020Feb. 2020Sept. 2020Feb. 2020Sept. 2020Feb. 2020Sept. 2020Feb. 2020Sept. 2020
Canada Low Low Low Low Moderate Moderate Low Low Moderate Moderate
Victoria Low Low Moderate Low Moderate Moderate Low Low High Moderate
Vancouver Low Low Low Low Moderate Low Low Low Moderate Moderate
Edmonton Low Low Low Low Low Low Moderate Moderate Low Low
Calgary Low Low Low Low Low Low Moderate Moderate Low Low
Saskatoon Low Low Low Low Low Low Low Low Low Low
Regina Low Low Low Low Low Low High Moderate Moderate Low
Winnipeg Low Low Low Low Low Low Moderate Moderate Low Low
Hamilton Moderate Moderate Moderate Low Low Low Low Low Moderate Moderate
Toronto Moderate Low Moderate Low Low Low Low Low Moderate Moderate
Ottawa Low Moderate Low Moderate Low Low Low Low Low Moderate
Montréal Moderate Moderate Low Moderate Low Low Low Low Low Low
Québec Low Moderate Low Low Low Low Low Low Low Low
Moncton Moderate Moderate Low Low Low Moderate Low Low Low Moderate
Halifax Low Low Low Low Low Moderate Low Low Low Moderate
St. John’s Low Low Low Low Low Low Moderate Low Low Low
Degree of vulnerability
  Low   Moderate   High

*The September 2020 overvaluation ratings are based on prliminary stimates.

CMHC issues the HMA on a quarterly basis to provide Canadians with expert and impartial insight and analysis, based on the best data available in Canada. The report provides a comprehensive view of housing market vulnerabilities and identifies imbalances. The HMA is not intended to identify long-term challenges related to housing affordability.

Provided by: CMHC

Simon Fraser
Market Update

Simon Fraser Condos

Altaire by Polygon

Altaire built in 2008/2009 reaches higher then any other condo building in Metro Vancouver offering panoramic views.

Novo I by Intergulf

Novo I built in 2007 known for the amazing sight lines and views from most units and balconies up to 1000 sq ft.

Novo II by Intergulf

Novo II built in 2007 known for the amazing sight lines and views from most units and balconies up to 1000 sq ft.

Aurora by Polygon

Aurora built in 2006 with 103 condos featuring 36 unique floor plans ranging from 715 sq ft to 1500 sq ft.

One University by Millennium

One University built in 2005 is UniverCity's flagship building with luxury homes featuring semi private elevators.

Harmony by Polygon

Harmony built in 2005 was the first condo development at Univercity & as a result offers a unique setting & views.

Serenity Townhomes by Polygon

Serenity is a collection of 2 bedroom townhomes of 1100 sq ft ranging to 4 bedroom 2000+ sq ft townhomes.

The Hub by Liberty Homes

The Hub built in 2009 is set atop Nester's Grocery and steps from High Street giving these homes an urban feel.

Verdant by VanCity Enterprises

Verdant is a two storey town home building built with environmental design and stylish living spaces which complement the modern exterior of these SFU homes.

Origin by Porte Development

Origin is designed by GBL Architect & BYU Interior Designs, developed by Porte Development Corp. and marketed by Red Dot Real Estate.

Nest by Mosaic

Located on UniverCity High Street across from the new University Highlands elementary schools this refreshing building will add further depth to a growing community.

Highland House by Liberty Homes

A 12-storey concrete high-rise development and targeted towards Rental Investors and First-Time Condo Buyers.

Lift by Porte Development

Lift will be a wood frame building comprising of 56 homes. Building technologies, environmental features, and price points should be similar to Origin.

Altitude by Hungerford Group

Altitude will be a 2 tower development comprising of a 12 and 14 story building with a total of 210 strata units.

CentreBlock by Liberty Homes

CentreBlock at UniverCity atop Burnaby Mountain is the latest condo project with sales commencing early 2014. .

The data relating to real estate on this website comes in part from the MLS® Reciprocity program of either the Real Estate Board of Greater Vancouver (REBGV), the Fraser Valley Real Estate Board (FVREB) or the Chilliwack and District Real Estate Board (CADREB). Real estate listings held by participating real estate firms are marked with the MLS® logo and detailed information about the listing includes the name of the listing agent. This representation is based in whole or part on data generated by either the REBGV, the FVREB or the CADREB which assumes no responsibility for its accuracy. The materials contained on this page may not be reproduced without the express written consent of either the REBGV, the FVREB or the CADREB.