Canada's housing market looks like it has a "modest amount of overvaluation" in a number of markets, but otherwise there is nothing to worry about, the Canada Mortgage and Housing Corporation says.

The CMHC revealed its House Price Analysis and Assessment publicly for the first time on Monday. It's one of the ways the agency documents its observations on the housing market from time to time, but Monday was the first time it was released to the public.

Across the country, home prices are probably slightly higher than they should otherwise be, with pockets of concern in some cities, the agency says. But even the level of overvaluation has come down compared to the last time the CMHC looked at the data.

Outside of prices, the CMHC says the housing market is "stable and unchanged" in other categories that the agency monitors.

"At the national level, other than a modest amount of overvaluation, we do not detect the presence of other risk factors such as overheating, price acceleration, and overbuilding," CMHC's chief economist Bob Dugan said.

In Vancouver, one city where the housing market tends to get a disproportionate amount of media attention, the housing agency described the situation as "stable" and "unchanged" on every metric it tracks.

But on the price front, there are indeed pockets of concern. "Overvaluation is most evident in Montreal and Quebec, but the trend is improving," Dugan said. "A modest risk of overvaluation is also present in Toronto, Calgary and Halifax."

Toronto and Montreal

Indeed, the agency singles out Canada's two largest housing markets — Toronto and Montreal — on two fronts: not only are prices likely higher than they should be, but they're also building too many new ones.

"The number of units under construction is elevated in these centres," Dugan said. "This could develop into overbuilding if these units are completed but not sold."

To guard against that, builders need to be careful to maintain a balance between the number of new condos they have already broken ground on but not sold, and those that are still in the planning stage.

In Toronto, the CMHC says prices are higher than they would probably otherwise be based on income levels and other factors.

"Real personal disposable income has not been increasing as fast as growth in house prices in recent years," the CMHC said. Although the agency noted that both income levels and the population of 25- to 35-year-olds are increasing in Toronto — and those are two factors likely to maintain demand for housing.

According to the CMHC's metrics, Montreal has more to worry about. The only two categories that were described as "high risk" were the level of overvaluation in Montreal and Quebec City — although in both, the risk is less than it used to be.

Data out last week from the Canadian Real Estate Association showed the average Canadian home has never been more expensive — up by seven per cent to almost $420,000 last month.