CMHC has some concerns with the Winnipeg Housing Market
7th Nov 2018
After returning from our annual Mortgage conference and hearing positive reports from the big banks, mono-line lenders and other leaders in the our industry the outlook for next year appeared to be looking good. After reading CMHC’s fourth quarter housing outlook it may be that Winnipeg will have a few bumps in the road to deal with.
Here are CMHC’s comments from their latest housing report for Winnipeg:
“Winnipeg: Moderate degree of vulnerability A moderate degree of overbuilding was detected as the inventory of completed and unsold units increased to elevated levels in the second quarter of 2018. Overvaluation continued to be assessed as moderate. While real disposable income decreased, there was an increase in the population aged 25 to 34 years and growth is easing for some house price measures. According to the HMA decision rule, a high degree of overall vulnerability should be indicated when both overvaluation and overbuilding factors exhibit evidence of imbalances. However, Winnipeg’s overall assessment was adjusted to moderate in this quarter as evidence of overvaluation and overbuilding observed is marginal.”
Looking at the full report closer it is CMHC’s opinion that the local market is moderately overvalued and has a high inventory of new homes. It’s not as doom and gloom as other markets in Canada but there appears to be some concerns. With all the changes made to lending guidelines it wouldn’t be shocking to see local prices level out and stay flat for the next few years. That said, the real estate market in Winnipeg has been historically stable and is still affordable for most so slight increases for certain price ranges may also be expected.
As 2018 winds down we enter our slow season so the next few months won’t be telling, but it will be something to watch in Spring 2019 to see what this means for real estate prices moving forward.