Migration is one of the fundamental drivers of housing demand in Canada. Migration trends can lead to substantial shifts in housing demand. This may produce house price volatility if housing supply is unresponsive to these changes.
Our latest Housing Market Insight explores the relationship between migration and house prices. It identifies the most significant migration trends in the 2002 – 2019 period in Canada’s highly populated CMAs. We placed a special emphasis on the housing supply response to these significant developments in migration and the resulting price changes that occurred.
We break down migration by factors such as type:
- from other countries
We also break it down by age group to provide greater context to these trends.
Most existing studies on migration and housing have solely focused on the role of international migration in shaping housing market conditions. Few studies have examined whether migration, particularly within the country, also responds to housing market conditions.
House prices surged in Toronto and Vancouver between 2015 and 2019 owing to a combination of factors, most notably:
- high international migration
- unresponsive housing supply
This was a catalyst for significant changes in domestic migration patterns within their respective provinces.
Key findings from the report:
- Migration can contribute and, in special circumstances, also respond to significant changes in housing market conditions.
- Greater out-migration from Toronto and Vancouver put considerable upward pressure on house prices in many other regions of their respective provinces, particularly their neighbouring CMAs.
- Housing market conditions in Toronto, Vancouver and their neighbouring CMAs fueled much greater migration to a number of smaller population centers in Ontario and British Columbia.
This study does not cover 2020, which was the year of the pandemic with untypical migration and housing market trends. More time is needed to better understand the implications. Initial data examination suggests that increased teleworking is an emerging factor that may put additional upward pressure on house prices in smaller population centres going forward.
This report can help urban planners, policy-makers and developers in creating housing supply based on how migration patterns contribute to and respond to house price changes.
The relationship between migration and house prices report is part of CMHC’s Housing Market Insight series. Get new reports as soon as they are released, sign up to receive our Housing Research Newsletter.