A new report from the Canada Mortgage and Housing Corporation has found overvaluation in 11 housing markets across the country, as well as other “problematic conditions” in cities like Toronto, Winnipeg and Saskatoon. 

The housing market assessment report, released Thursday, says that overvaluation and price acceleration are the main issues in Toronto, while such cities as Winnipeg, Saskatoon and Regina are seeing overbuilding and overvaluation.

The CMHC analyzed housing markets in 15 census metropolitan areas and found “weak evidence” of problematic conditions at the national level. However, overvaluation and overbuilding have been noted in several regions across the country.

He said that housing price levels in Toronto, Vancouver, Montreal, Edmonton and Saskatoon are “not fully supported by economic and demographic factors.”

CMHC says it’s monitoring for “the potential emergence of overbuilding” in Toronto, Montreal and Ottawa, especially when it comes to condos.

While some overvaluation was detected in Vancouver, “overheating, acceleration in house prices and overbuilding are not a concern in this market,” the CMHC says.

During a teleconference call with reporters on Thursday, Dugan said the CMHC’s latest quarterly assessment is meant to be “an early warning indicator” for housing markets, well before they are “so far down the road that a crash is inevitable.”

The CMHC says it’s trying to get the message out to home builders and other players so that adjustments can be made.  

Dugan said overvaluation is driven by varying factors, depending on the metropolitan area.

In Vancouver and Toronto, for example, there’s strong price growth and market pressure due to increased sales of single homes valued at $1 million and higher.

In cities such as Regina, Saskatoon and Winnipeg, overvaluation is linked to “weakened fundamentals,” including disposable income, mortgage rates and population growth, Dugan said.

The loss of jobs and revenue from the oil and gas sector in Western Canada has also been linked to softening real estate prices in cities including Calgary and Regina.