Flaherty says Canada's housing market moderating
By Ka Yan Ng and Trish Nixon
TORONTO (Reuters) - Finance Minister Jim Flaherty said on Monday he continues to monitor the country's housing market, which has some "hot spots", but said the situation remained stable.
"We have seen some moderation in the housing market in Canada," Flaherty told reporters after a speech in Toronto. "There are a couple of hot spots in the country, including Vancouver, the condo market in Vancouver, but overall I'm satisfied that there is some moderation in the market."
Unlike the United States, where home prices have fallen below the lows hit just after the financial crisis, Canadian house prices have climbed to multi-year highs, helped by low interest rates and the country's still healthy banking system.
While the gains have helped power the economic recovery, some officials and economists have fretted about the potential for the boom to become a bubble.
Flaherty told Parliament later on Monday that Canada's housing sector is in a "very different place" compared to the U.S. market.
"The reality is that their housing crisis continues, that there's a danger of a prolonged housing crisis in the United States. That's not in Canada, and that's because we regulate, we supervise, we monitor; we have fiscal responsibility in terms of the housing sector in Canada, a very different place," he said.
Flaherty's comments about hot markets echoed concerns flagged by Bank of Canada Governor Mark Carney last week in Vancouver, the country's most expensive housing market. Carney said some trouble spots like Vancouver have characteristics of "financial asset markets" and urged policymakers to be vigilant. Continued...