Treading Water: Impact of Catastrophic Flooding on Canada’s Housing Market

Treading Water Report Cover

Treading Water: Impact of Catastrophic Flooding on Canada’s Housing Market (February 2022): by Kathryn Bakos, Dr. Blair Feltmate, Chris Chopik, and Cheryl Evans. This study examined whether catastrophic flooding affects Canadian residential real estate (house sold price, days on market, number of listings) and mortgage markets (arrears and deferrals).  The primary audience to which findings of this report bear direct relevance includes homeowners, mortgage providers, municipalities and financial regulators.



Infographic summarizing key findings of the report Treading Water

Treading Water Infographic

This infographic summarizes the key findings of the report, “Treading Water: Impact of Catastrophic Flooding on Canada’s Housing Market”.



Kathryn Bakos presented the findings of Treading Water at the Global Risk Institute Webinar: Climate Change: Layering Further Complexity on Mortgage Risk, on June 7, 2022. The event recording is available on Youtube.

PRESS RELEASE | February 15, 2022

Homes sell for 8.2 per cent less after catastrophic floods 

Flooding has pushed down housing prices in communities across Canada.

New findings show that over the past eight years, catastrophic flooding in communities resulted in an average 8.2 per cent reduction in the final sale price of houses, 44.3 per cent reduction in the number of houses listed for sale, and 19.8 per cent more days on market to sell a house.

These findings are presented in a new report from the Intact Centre on Climate Adaptation, University of Waterloo. The study focuses on five Canadian cities, each of which had experienced catastrophic flooding between 2009 and 2020: Grand Forks, B.C.; Burlington, Ont.; Toronto; Ottawa; and Gatineau, Que.

The impact of flooding was measured for periods of six months before and after flood events.  Attribution of flood impacts was determined by comparing changes in nearby non-flooded control communities over identical time frames.

“The findings of this report do not surprise me” said Gary Will of Will Davidson LLP, a firm that advises on flood risk.  “They underscore the impact on housing prices and the need to actively reduce flood risk through updated flood plain modelling and mapping, and to re-think development, without delay, as flooding affects everyone from planners, home owners to government decision-makers.”

The study also examined the impact of community level flooding on mortgage arrears and deferrals in two Canadian cities for six months pre and post flooding.  Results showed no change in homeowners’ ability to pay their mortgage, but a reduction in the appraised value of a house due to flooding would influence limits on lending by mortgage providers.

As noted by Steve Mennill, Chief Climate Officer, Canada Mortgage and Housing Corporation (CMHC), “For most homeowners, their house is their biggest financial investment.  As this report clearly shows, an all-of-society effort to protect that investment from the growing threat of flooding would be of great benefit to many Canadians.”

Study co-author Dr. Blair Feltmate said “Canada must learn to manage flood risk, rather than chase it.  Recognizing that residential flooding is the most costly and pervasive impact of extreme weather, municipal planners should double-down on ensuring that adaptation factors into community design.”

Actions recommended in the report to give Canadians guidance to limit flood risk include:

Home flood protection guidance: Municipalities, banks, insurers and real estate associations should distribute guidance to home owners on means to lower risk of basement flooding.

Climate Adaptation Home Rating Program (CAHRP): The federal government should link the CAHRP to EnerGuide home energy audits.

Flood risk maps: The federal government should update flood risk maps and ensure they are publicly accessible.

Residential flood risk scores: The federal government should develop a home flood-risk scoring system based on postal code (as already exists in the US).

Natural infrastructure: All governments should commit to retaining and restoring natural infrastructure (forests, grasslands, wetlands) to limit current and future flood risk.

Community flood risk mitigation: Communities should act now to identify and protect areas at high risk of flooding.

Canada has the tools necessary to mitigate flood risk, today.  If these tools are not mobilized, with a sense of urgency, flood disasters as seen on Canada’s west and east coasts in November 2021 will be increasingly commonplace.


Contact details:

Ryon Jones, Media Relations Manager
226-339-0894 |

Kathryn Bakos
Director of Climate Finance and Science Program, Intact Centre on Climate Adaptation
University of Waterloo
519-572-1463 I

Dr. Blair Feltmate
Head, Intact Centre on Climate Adaptation
University of Waterloo
226-339-3506 I

For Quotes from Subject Matter Experts Please Contact:

Media Relations
Canada Mortgage and Housing Corporation (CMHC)

Alyson Slater
Senior Director, Sustainable Finance, Global Risk Institute Financial Services (GRI)
905-630-9076 I