The Canada Mortgage and Housing Corporation says Toronto is at “high risk” of a housing correction.
According to the CMHC, Canada as a whole isn’t at risk, just Toronto, Winnipeg, and Regina – though they’re reasons for being at risk are all different.
For Toronto, the CMHC says the primary concern is that “the rise in house prices has not been matched by growth in personal disposable incomes.” It also adds that there’s evidence of overbuilding in the market, with historically high number of unsold units.
In Winnipeg, the reason is due to overvalued home prices and overbuilding, while Regina cited rapid growth, overvaluation, and overbuilding – particularly with condo’s – were responsible.
In April, Toronto was at a “moderate risk” of a slowdown.
The housing agency looks at market conditions in 15 major housing markets across Canada. All other major cities were in good shape.
Vancouver, home to the nation’s most expensive real estate, came up at a low risk of correction.