Tony Wong, Business Reporter for the Toronto Star, has reported that A US-style housing crash is unlikely in Canada,and this according to a study by the CD Howe Institute.
A decline in underwriting standards played an essential role in the American housing boom, and subsequent bust. That has not been the case ion Canada, says the report, released last Tuesday.
It comes on the heels of another story by the Canadian Centre for Policy Alternatives, which said that the Canadian housing market is a bubble ready to burst. It also shows the debate that economists are having over the direction of the market.
Canadian housing policies "worked well in reducing the possibility of a housing bust in Canada," Says the C.D. Howe Report.
Many of the concerns about the Canadian housing market are motivated by recent US experiences, wrote Jim MacGee, author of the report and an associate professor of economics at the University of Western Ontario.
He went on to say that a comparison of housing market policies in Canada versus the US suggests that there is little likelihood of a US-style surge in foreclosures or a collapse of house prices in Canada.