Canadian property bubble

Vancouver home prices

The Canadian property bubble refers to a significant rise in Canadian real estate prices from 2002 to present (with short periods of falling prices in 2008, 2017, and 2022) which some observers have called a real estate bubble. The Dallas Federal Reserve rated Canadian real estate as "exuberant" beginning in 2003.[1] From 2003 to 2018, Canada saw an increase in home and property prices of up to 337% in some cities.[2] In 2016, the OECD warned that Canada's financial stability was at risk due to elevated housing prices, investment and household debt.[3] By 2018, home-owning costs were above 1990 levels when Canada saw its last housing bubble burst.[4] Bloomberg Economics ranked Canada as the second largest housing bubble across the OECD in 2019[5] and 2021.[6] Toronto scored the highest in the world in Swiss bank UBS' real estate bubble index in 2022, with Vancouver also scoring among the 10 riskiest cities in the world.[7] The Royal Bank of Canada analysis showed that Canadian housing had become the least affordable that it had ever been.[8] By 2023 Canada’s nonfinancial debt exceeded 300% of GDP[9] and household debt surpassed 100% of GDP,[10] both higher than the levels seen in the United States before the 2008[dubious – discuss] global financial crisis.[11][12] Canada's housing investment as a percentage of GDP ratio peaked at 8.9% in 2022,[13] whereas the US at the peak of the housing bubble only reached 7% in 2006.[14][15]

  1. ^ "International House Price Database, Third Quarter 2022 Data". www.dallasfed.org. Retrieved September 3, 2023.
  2. ^ Haber, Bob. "Canadian Real Estate Bubble Blowing Up North." Forbes, Forbes Magazine, April 3, 2018, www.forbes.com/sites/bobhaber/2018/04/02/canadian-real-estate-bubble-blowing-up-north/#1b74d3871d5e.
  3. ^ Economic and Development Review Committee (EDRC) of the OECD (June 2016). "2016 Economic Survey of Canada" (PDF). OECD.org. Retrieved September 25, 2023.
  4. ^ Tencer, Daniel (October 3, 2018). Canada At Risk As 'First Cracks' Appear In Global Housing Bubbles: UBS., HuffPost (Canada edition)
  5. ^ "So Where Is the Next House Price Bubble Brewing?". Bloomberg.com. July 30, 2019. Archived from the original on December 14, 2019. Retrieved June 25, 2021.
  6. ^ "World's Bubbliest Housing Markets Flash 2008 Style Warnings". Bloomberg.com. June 15, 2021. Archived from the original on June 15, 2021. Retrieved June 25, 2021.
  7. ^ "UBS Global Real Estate Bubble Index 2022". Insights. Retrieved September 3, 2023.
  8. ^ Hogue, Robert (March 29, 2023). "Brighter days ahead as home ownership costs go through the roof". RBC Thought Leadership. Retrieved April 28, 2024.
  9. ^ "BIS Statistics Explorer: Table F1.1". stats.bis.org. Retrieved September 3, 2023.
  10. ^ "Household debt, all instruments". www.imf.org. Retrieved April 13, 2024.
  11. ^ "Household debt, loans and debt securities. Percent of GDP". International Monetary Fund. Retrieved September 3, 2023.
  12. ^ "BIS Statistics Explorer: Table F1.1". stats.bis.org. Retrieved September 3, 2023.
  13. ^ "Housing Sector Country Snapshot: CANADA" (PDF). OECD. June 7, 2023. Retrieved April 30, 2024.
  14. ^ Weinstock, Lida R. (January 3, 2023). "Introduction to U.S. Economy: Housing Market" (PDF). Project on Government Secrecy. Federation of American Scientists. Retrieved April 30, 2024.
  15. ^ Punwasi, Stephen (January 3, 2024). "Canadian Economy Dangerously Concentrated In Real Estate, But Gov Wants More". Better Dwelling. Retrieved May 1, 2024.