How Risky Is Your Province’s Housing Market?

Risky Housing Markets

When discussing Canada’s hottest markets, Toronto and Vancouver come to mind – these bustling metropolises tend to hog the limelight in the market media as they’re known for too-hot-to-handle price growth and rapidly shrinking supply. One would assume they’d top the list for risky housing markets in Canada – but the Canada Mortgage and Housing Corporation (CMHC) has found otherwise. In a recent report assessing the riskiest housing markets in Canada, Winnipeg and Regina were the biggest offenders.

If you find this strange, you’re not alone – David MacKenzie, president of the Winnipeg Realtors Association in response to the report told the Financial Post, “I don’t know where CMHC is coming from. There is a lot of inventory. Developers are not going to put down their hammer for projects already committed to, they won’t slow down waiting for the markets to catch up. It’s still a healthy market right now. I don’t know how you can describe it as high risk.”

It’s not the first report that has singled out Canada’s market risk factors: the Bank of Canada, Deutsche Bank, and the IMF have all expressed concern over the overvaluation of real estate in our country. How risky is your region? Here’s a breakdown of the major cities per province based on the report.

British Columbia

Despite being the priciest real estate market in the country, CMHC considers Vancouver a low-risk market, stating, “Low overall housing market risk is observed for Vancouver, as none of the individual risk factors are currently detected.”

Demand for housing, while steep, is supported by strong growth in population and disposable income. First time home buyers are finding affordable options in the suburbs, while those with the affordability to buy in the city’s core benefit from a prime location.

Click here to view mortgage rates in British Columbia>


The CMHC has yet to peg Calgary and Edmonton as high-risk markets – but there are signs of trouble in the wild rose province. Sales have slumped in Calgary, with home prices on the decline for five straight months, while foreclosures and bankruptcies are on the rise. Bankruptcy proposals in Cowtown have increased by 24 per cent over the past six months ending in February, the highest in Canada. However, despite the downturn in prices, growth continues to outpace disposable personal income in the province. A slower inflow of migrants to oil fields could spell trouble in the coming months.

Click here to view mortgage rates in Alberta>


The CMHC reports Regina is suffering from overzealous development, especially in the condo sector, which has led to a recent scaleback in new projects. Home prices have been on the rise for several years, yet wages have been stagnant. “Strong price growth in recent years has led to price acceleration. Risk of overvaluation reflects the combination of strong growth in house prices and modest gains in personal disposable income. Over the past year, higher supply relative to demand has had a moderating effect on average resale price growth,” states the report.

Saskatoon, however, gets a green light across the board, with only slight concern of overbuilding.


While Winnipeg remains to be low risk for overheating and rising home prices, concern remains of overbuilding, and overvaluation of existing properties. It’s a similar story to Regina: the province has seen more modest gains in personal disposable income than real estate values. That’s not the only worrying sign: the number of units being built and the number of completed and unsold units are historically high.


CMHC mainly looked at two cities – Toronto and Ottawa – in Canada’s most populous province. Many may be surprised to find that Toronto, like Vancouver, is only moderately risky, with the main areas of concern being lagging income growth in comparison to prices, and an oversupply of condos. Ottawa, however, received a passing grade as income levels have kept pace with real estate prices in the region, leading to great affordability.


La Belle Province is home to two major housing markets: Montreal and Quebec City. Both are graded as moderately risky by CMHC. An oversupply of condos has raised the risk level from low to moderate in Montreal. In Quebec City, lower first-time home buyer demand coupled with price appreciation outpacing income growth has raised the risk level.

The Maritimes, Newfoundland and Labrador

Halifax and St. John’s were the CMHC’s main focus markets, both of which are considered low risk, although this could change in the coming months; price appreciation is in line with growth in personal disposable income.

Do you think the CMHC’s report accurately describes your local housing market? Tell us in a comment, or visit us on Facebook and Twitter.

Sean Cooper is a Financial Journalist and Personal Finance Expert, living in Toronto, Ontario. He offers Unbiased Fee-Only Financial Advice, specializing in pensions and the decumulation of financial wealth in retirement. Follow him on Twitter @SeanCooperWrite and read his blogs and request his writing services on his personal website:

Related Topics

Buying A Home / Mortgage News / Mortgages

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>