The Bankwatch

Tracking the consumer evolution of financial services

Canadian housing price warning from Economist Intelligence Unit

A strongly worded warning on Canadian housing prices from the EIU and backed up by comments from the OECD.

Canada banks: Piling up profits | Economist Intelligence Unit (reg’n required)

The OECD has taken notice of Canada’s housing bubble, advising the Bank of Canada to begin hiking interest rates with a target of 2.25% by the end of 2012, up from 1% where it has stood since September 2010. The fear is that Canadian homebuyers are borrowing more than they can sustain once rates turn higher. This situation could result in a real-estate bust and massive mortgage defaults in a replay of the US sub-prime crisis in 2008.

Written by Colin Henderson

May 31, 2012 at 23:28

Posted in Uncategorized

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