Saskatoon’s housing market continues to show strong evidence of problematic conditions according to a new report from Canada Mortgage and Housing Corp. (CMHC).
The housing market report for the first quarter of 2017 said there is strong evidence of overbuilding, particularly in the multi-family sector and apartment condominiums.
READ MORE: Saskatoon leads country in apartment vacancy rate: CMHC
In October, CMHC reported that the rental vacancy rate in the city rose to 10.3 per cent, due to weaker rental demand and an increase in rental supply.
The latest report states demand has not kept up with supply, with the number of completed and unsold units relative to population significantly above the long-term threshold for overbuilding.
It also found moderate indications of overvaluation in the market.
“Recent downward price adjustments have been countered by weak economic and labour market conditions, including a decline in personal disposable income,” Goodson Mwale, the senior market analyst for Saskatchewan, stated.
READ MORE: Saskatoon housing starts down in 2016
CMHC said overvaluation could be resolved by either a further slowdown in price growth or a pickup in employment and income, or a combination of the two.
The report stated there is little evidence the housing market is overheated and price acceleration remains weak.
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