The Canada Mortgage and Housing Corp. says there is a modest amount of overvaluation in the country’s housing markets, however other risk factors such was overheating, price acceleration, and overbuilding are not present.
In its house price analysis and assessment, CMHC says, overall, housing markets in Canada are broadly consistent with underlying demographic and economic factors such as employment and interest rates.
CMHC chief economist Bob Dugan says the risk of overvaluation is most evident in Montreal and Quebec, but added that the trend is improving.
He said a modest risk of overvaluation is also present in Toronto, Calgary and Halifax.
However, CMHC did not point to Vancouver, one of the country’s hottest real estate markets as being at a risk of overvaluation.
CMHC says home prices in Vancouver are supported by local growth in personal disposable income and long-term population growth.
Source: Money Sense