wolfstreet.com / by Wolf Richter • October 1, 2014
Canada’s truly magnificent housing bubble, incomparably more magnificent that the housing bubble in the US that blew up with such spectacular results, is starting to worm its way into all sorts of venues. And on Tuesday, Bank of Canada Deputy Governor Agathe Côté had a special place for it in her discussions of “vulnerabilities and risks” to the “stability of the financial system.”
Home prices in Canada rose more moderately than in the US during the crazy go-go years from 2000 until the financial crisis: in the US they more than doubled in that period, according to the CaseShiller Index, while they rose “only” about 70% in Canada, based on the Teranet–National Bank National Composite House Price Index.
But then the hot air was let out of the housing bubble in the US between 2007 and 2011. In Canada, after a minor ripple between 2008 and 2009, home prices continued soaring – to this very day. In August, they rose another 0.8%. Over the last 14 years, prices have increased by 150%, twice as fast as in the US.
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