06/30/2012
Canada's Housing Market
Is there a “Housing Bubble” in Canada?
Overall, there are strong demographic and economic factors supporting the Canadian housing market, including growth in employment, net migration and low interest rates. However, there are some centres that CMHC is monitoring more closely.
CMHC uses many of the key indicators identified in the economic literature to help assess house prices. These indicators look at mismatches between supply and demand, accelerating trends in house prices, and valuation of house prices that may be higher than what demographic and economic fundamentals would suggest.
Although it has been suggested that Canadian housing markets will experience the same severe adjustments as U.S. markets did. Housing markets in Canada are less exposed to some of the risks that shaped the recent U.S. experience. The sub-prime market, in particular, never took hold in Canada to the extent that it did in the U.S. Lending standards have remained rigorous in Canada. Indeed, the rate of mortgage arrears in Canada is less than one half of one per cent, according to the Canadian Bankers Association (CBA)’s backgrounder, Canada's Strong Banking System: Benefitting Canadians, which also reports that the rate of arrears in the US is more than ten times higher than in Canada.
For more information see:
http://www.cmhc.ca/en/hoficlincl/homain/foan/index.cfm
Date modified: May 30, 2012
Future-oriented information about local, regional and national housing trends.
