Supply-demand gap largest in Toronto, Vancouver - CMHC

Toronto and Vancouver’s real estate markets have responded to surging prices and a growing demand for homes with a supply of new housing that is “significantly weaker than other Canadian metropolitan areas.” The disparity between supply and demand has been largest in the two cities, but “we do not fully know why this is the case,” said the Canadian Mortgage and Housing Corporation, in a report it released on Wednesday (February 7) on escalating house prices in the country’s large metropolitan centres between 2010 and 2016. Data gaps are keeping CMHC from developing a full picture of why Montreal, Calgary, and Edmonton don’t have as big of an inconsistency between supply and demand as Toronto and Vancouver do, but CMHC’s deputy chief economist Aled ab Iorwerth said he has noticed Calgary and Edmonton responding to demand with “horizontal sprawl.” As for Montreal, he told The Canadian Press that the city already has “a large rental sector, there is perhaps an acceptance of living in denser housing there, and they seem to be more ready to convert industrial land into housing.”

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