Vancouver real estate 'bubble' at 30-year peak, report cautions

August 31, 2010

The Vancouver Sun

Steep housing price increases in six of Canada's hottest real estate markets since 2002 have all the hallmarks of an "accident waiting to happen" if mortgage rates rise too sharply, warns a new report.

The report by the Centre for Policy Alternatives says smart mortgage rate setting is needed to prevent the bubbles hanging over the housing markets in Vancouver, Edmonton, Calgary, Toronto, Ottawa and Montreal from bursting.

"The hottest six real-estate markets could be in for a correction at best or, at worst, a bubble burst," writes David Macdonald, author of the report. "Rate setters at the big banks are in the driver's seat now as mortgage rates inch up. They need to hit the breaks lightly."

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