I wouldn't say it's the source. The difficulty from monetary policy is that they wanted to support the economy. Their main lever for doing that is their policy rate, so they lowered the policy rate. Interest rates have been low for many years, and this has fuelled housing markets throughout the world.
To counteract that, what governments have been doing, including the Canadian government, is what they call macroprudential policy, which tries to place limits on mortgage borrowing so that it doesn't drive house prices up. You can also introduce supply-side measures, as I've mentioned.
One thing to think about with countries that statistically have a very low population density.... I used to work in Australia, and in a way Australia had the same sort of housing market issues. Australia has a very urban population, and I think that's probably true of Canada, in the sense that a huge percentage of the population live in urban areas. They're rather like islands, if you like.
You're absolutely right. If you view Canada's population density, it doesn't seem to make sense, but people want to live in cities, and that drives the price up. It might change with more teleworking. We'll see.