In its most recent market update, the Canada Mortgage and Housing Corp. says overvaluation concerns are growing in Regina and Winnipeg because prices have outstripped family incomes and supply is dangerously high because of a condo boom.
In Regina, that increased supply has eroded resale prices. Compounding things is the growth in unsold construction starts, now at a record high. The CMHC contended, however, that builders have already been scaling back on production.
Similarly, in Winnipeg builders in the detached home market have begun to slow in response to increased inventories. Still condo builders are expected to continue on with projects already in the pipelne, the report says.
“Modest overvaluation based on national indicators reflects a variety of price conditions across the country with some centres showing more signs of overvaluation than others,” said Bob Dugan, CMHC’s chief economist. “Likewise, housing market risk factors such as overheating, acceleration in house prices and overbuilding also vary by CMA.”
Forget Toronto and Vancouver -- CMHC is pointing to two other Canadian cities where properties are significantly overvalued.