This from the CBC
Canada’s ‘housing bubble’ deemed close to bursting
It would seem that more people than just Chris Horlacher can see the writing on the wall.
Canada’s housing market is in a bubble that’s set to burst and prices could plunge by as much as 25 per cent, a major independent research firm warns.
â€œHousing valuations have lost all touch with fundamentals and household debt is at a record high,â€ economists at the research consultancy Capital Economics say in their most recent Canada Economic Outlook, issued Wednesday.
â€œOur fear is that, with the housing bubble now close to bursting and commodity prices retreating, Canada will go from leader to laggard.â€
Whatever the trigger may be, our governmentâ€™s reaction will likely be the same as the U.S.A. They will sweep in to support the CMHC with bailouts and guarantees. The Bank of Canada will continue to do everything they can to keep interest rates low in order to forestall the defaults. These actions will only paper over the problems that are now deeply-rooted in our financial system and further debase the currency.