The federal government will establish a working group to study the current state of Canada’s housing market and provide policy recommendations, Finance Minister Bill Morneau announced on Thursday.
The group will be comprised of officials from the Government of Canada, the provinces of Ontario and British Columbia, and the cities of Toronto and Vancouver.
The Department of Finance says the group will meet throughout the summer months to “review the broad range of factors that affect supply and demand for housing, the issue of affordability, and the stability of the housing market.”
The issues surrounding homeownership are a shared responsibility, with provincial governments and municipalities having to act locally, Morneau says. “By collaborating even more closely with our provincial and municipal partners, we will ensure a coordinated approach, and make use of the best available evidence to arrive at the right conclusions.”
The federal government will also continue to evaluate whether further steps can be taken to protect borrowers and lenders to help maintain a stable and secure housing market for Canadians.
The news comes just a day after RBC Economics released a report stating that housing is continuing to become even less affordable in Canada, especially in Vancouver and Toronto.
The report notes that home prices in those two cities are rising at an faster pace than other municipalities, which raises concerns about an overheating market.
“First-quarter prices for single-detached homes in Vancouver surged nearly 25% year-over-year, and such a parabolic rise in prices signals the presence of over-exuberance in this segment of Vancouver’s market that is not fully justified by the robust local fundamentals,” says RBC chief economist Craig Wright.
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Flickr: Pascal Walschots