Canada’s housing market frothy

Canada’s housing market frothy, but not a bubble
Tighter regulation, healthier banking sector insulate housing market


TORONTO (MarketWatch) — Canada’s pricey housing market is frothing — driven by debt-ridden borrowers — but a dangerous U.S.-style housing crisis isn't in the cards, experts say.

“We don’t expect the base Canadian housing market to experience the trauma of the U.S. market,” said Robert Hogue, senior economist at Royal Bank of Canada RY
-0.46% 
in Toronto.

Regulatory observers said they agree that a series of actions taken by the Canadian government starting in 2008 and culminating in a June 2012 package of reforms to limit access to credit for borrowers is having its intended effect of cooling the frothy Canadian housing market.

Responding to the financial crisis of 2008, the Canadian government set a minimum down payment of 5% for government-backed mortgages. It also began a gradual reduction in the maximum amount of time borrowers could take to pay down their mortgages. The limit was set at 35 years in 2008 and was last cut in June to 25 years. The moves were imposed to tighten up underwriting standards that had been loosened between 2004 and 2008.

The steps were necessary, observers say, in the face of rising home prices — Canadian house prices have roughly doubled in the past decade, according to credit rater Standard & Poor’s — that forced borrowers to take on high debt to buy a house.

“There are signs that the market has been slowing. The measures [to tighten mortgage underwriting standards] by public authorities are preventative as well as reactive and cautionary, and they are having an effect,” said Sheryl Kennedy, CEO of Promontory Canada and deputy governor at the Bank of Canada from 1994 to 2008.

Kennedy argued that the regulatory actions taken over the past four years to tighten mortgage insurance and underwriting standards along with public pronouncements by the Bank of Canada and Ministry of Finance to ensure that Canadians understand they should be working to cut debt levels, have contributed to the cooling of the housing market.

but is that enuff?

is not only killing he bubble is important.  they have out-sourced a lot of the canadian market..lots of jobs.  and I dont think that has stopped.

yuh have to have an economy going with strong domestic support to with stand shocks in the failure of your export markets.

the USA is canadas biggest export market and deh are in real trouble. if they cant buy..or reduce their buying.. we have to look for other markets.

Hoolabahoo about our 100 Bill  :lipsrsealed:

keep it away from the heat :shocked: :shocked:

::rofl:: ::rofl:: ::rofl:: ::rofl::
fiat money..it melts!  even your pocket on a hot day? ::

I guess we all gotta be cool with 100 dollar bills in our pockets! :cheesy: :cheesy: :cheesy:

not that !

Apparently there was a faux pas showing a Chinee lady looking thru a Microscope !

focus groups protested and they change it to a Caucasian lady ...

Mark Carney , de Guvnor of Bank of Canada apologise  .... ::rofl:: 

Last week i thought why they jus dont put a pic of that Insulin discoverer:

a Canadian scientist ...

I see!  I have not been paying too much to canadian news ::

that's cause yu too focus on obama nad the good he doing for the world

i just came across Daniels First Homes easy afforable housing scheme for first home buyers.

the houses start at $179,990 and up.  the new home buyer is required to pay 5% down in the following format:

$2500 at signing

$2500 10 days later

$1000 monthly until the 5% has been reached.

all the time you are paying that $1000 you are not paying anything else - no mortgage or condo fee.

the homes are not freehold and the maintenance is only around max $250/monthly - which is not bad.

there homes sell out in 7 hours.

Daniels is one of the more reputable Builders .

5 % of 180 is only 9 K !

within 10 days of signing they have 5K  ::

The project takes another 1.5 years to complete !