Moody’s Investors Service reports that Toronto and Vancouver’s house prices are among the highest rising in the world and many properties are overvalued.
Economist Paul Matsiras concludes that those two markets are in a bubble that could burst as fewer buyers are able to afford bigger and bigger mortgages or rents.
Moody’s isn’t alone in its concern; The Economist
magazine is also sounding a cautionary note about Canada’s “Shaky Economy” which, despite increasing exports, inflation and higher interest rates are dangers ahead.
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High levels of household debt and escalating house prices may be played down by some Canadian analysts but for observers looking in, the picture is more worrying.