Canada’s cooling real-estate sector is slowly moving toward a more balanced market, but there won’t be any bust like in the U.S. following the subprime mortgage crisis, Scotiabank economist Adrienne Warren said yesterday following the release of several housing reports.
The bank forecast overall sales 15 per cent below last year's record levels, with home prices increasing on average about 5 per cent.
“Home prices in Canada are not substantially overvalued,” she pointed out. “There is still little evidence of widespread speculative home buying that often accompanies the late stages of a housing boom.”
As well, the market is not overbuilt and households are not excessively indebted, she added.