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Canadian Home Prices Rising At “Unsustainable” Rate

Back in 2008,  I wondered how sustainable the rise in Canadian home prices was, but the market has continued to rise.  Concerns are rising though, as evidenced by two pieces from the Globe and Mail yesterday.  One was this opinion from Bank of Montreal’s CEO Bill Downe:

“We took a long, hard look at the Canadian housing market and concluded … there was a legitimate concern that house prices – particularly in the largest cities – had been rising at a rate that was simply unsustainable,” Mr. Downe said.

“With growing concerns over household debt, a soft landing in housing is in the best interests of our customers and the national economy.”

The other was piece was this brief comment by the Globe and Mail’s financial columnist Rob Carrick he called Our housing bubble beats their housing bubble:

Canadian cities dominate this global listing of Google searches for “housing bubble”. [Click here to see image full size.]

 

Does this mean a “pop” is imminent?  Maybe not, but as we’ve discovered here south of the border, soft landings can be tough to engineer.

Published inBlog PostsCanadian MarketFinance

5 Comments

  1. Captain Ned Captain Ned

    Why do you think that all of the fix/flip HGTV shows are now filmed in Greater Toronto?

  2. Linenoise Linenoise

    I’m sure there’s nothing to worry about. It’s different there.

  3. Village Idiot Village Idiot

    I don’t suppose John Paulson has a Canadian housing/mortgage short fund?

  4. twist twist

    Ned-

    And when HGTV gives the price for some of those Toronto fixer-uppers, and the occupations of the folks who buy them, I find myself wondering how they can afford them. They’ve either got to be house-poor, have rich relatives, or amazing financing.

  5. twist twist

    V.I.-

    That would be interesting to know. I’d much rather follow Paulson’s investment model than the “Oracle’s”.

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