Canada’s Housing Bubble?

by Laura Ehrenberg-Chesler on May 31, 2012

in Credit Crisis,Foreign Markets,housing,Residential Real Estate

“The Christian Science Monitor” recently reported that Canada’s housing market may be heading toward a meltdown. Like the United States, Canada’s economy had been boosted by record low interest rates. However, they managed to avoid many of the pitfalls that sent much of the world into a financial tailspin during the financial crisis that started in 2008. Now however, with property prices having nearly doubled over the past decade, it no longer seems as though Canada will be able to avoid some kind

of correction in their real estate market. The International Monetary Fund believes those prices may be as much as 25% overvalued. With history as a guide, the Canadians ought to be taking steps, like slowly raising rates, to avoid the type of bubble and meltdown that the U.S. and many other countries experienced during the financial crisis.

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