IMF says Canada housing overvalued, urges more action if needed
* Housing overvalued by 10 pct, signs of overbuilding
* Household debt also a concern; more gov't measures may be needed
* Sees Bank of Canada rate hike in late 2013
* Says federal budget set for balance; provincial finances bumpier
By Louise Egan
OTTAWA, Feb 14 (Reuters) - Canadian housing prices were still about 10 percent overvalued at the end of 2012, the IMF said on Thursday, and it warned that authorities may have to intervene a fifth time in the mortgage market if personal debt levels rise further.
The International Monetary Fund, in its annual report on Canada, also said the country's currency was between 5 and 15 percent higher than warranted by long-term economic fundamentals, lifted in part by commodity prices and the country's safe-haven status for investors.
The Washington-based lender acknowledged that government measures since 2008 - and most recently last July - to cool overheated mortgage borrowing and house prices have helped prevent a U.S.-style housing bubble.
But residential prices and construction are both still excessive, according to its assessment based on meetings with Canadian officials from Dec. 3-18. Continued...