It’s been just over a decade since the U.S. housing market peaked, and rarely a day goes by without stories exploring the hot real estate market in Canada. Whether it’s warnings about elevated levels of household debt, government regulations to cool prices or the influx of foreign money, residential real estate generates sustained discussion and debate. After witnessing the housing crash south of the border, and the carnage it wrought, this is to be expected.
For all the attention, it’s notable that most analysts don’t see Canada facing a U.S.-style housing crash. For instance, Moody’s Analytics argued this month that even though price growth will decelerate, there is not likely to be a hard landing. Some observers are a bit more pessimistic, such as TD Bank, which predicts a 10 per cent fall in Vancouver house prices. Still, if there is a consensus view among professional forecasters about the Canadian housing market, it’s that prices will plateau or suffer only a minor dip. For a variety of reasons, most people do not see a U.S.-style crash on the horizon for Canada.