Why Canada's Housing Market Didn't Crash

cnbc.com ^ | 6/30/10 | Diana Olick

[Nachum]

They saw a housing boom, they saw a recession, and yet the Canadian housing market is still cooking with gas.

Why?

Fundamental differences in Canadian banking, borrowing and home buying.

I spent the day in Toronto a few weeks ago and was really interested to see how a few miles can span such a huge difference in collective attitude.

[BenKenobi]

I’m a Canadian. While there are some factors up here which are advantageous, housing is still overpriced. It’s not just that they made high risk loans, but demographics are going to be hitting housing demand.

There are many, many people, at least where I am looking to relocate, sell, etc, and very few houses are selling. Pretty much everyone who wants a house has one.

[celtictomcat]

I am in ottawa.
The housing market has not gone down at all.
House prices go up every year and houses sell.
I suppose some spots in canada might be the opposite but for the most part it is like ottawa in the rest of canada.
The article is wondering why Canadas housing market did not
crash. I think I made my point.

[celtictomcat]

You are hundred percent right about that.
The Gulf disaster has only made the tar sand more valuable and needed than it already is.

[BenKenobi]

Well Ottawa is no different than DC. Government is growing 10 percent a year.

[kitkat]

>>>American banks, bankers, loaners and lenders failed the public miserably.>>>

No, the banks did not fail the public. It was Fannie and Freddy (both democrat programs) which forced the banks to give loans to people w/o the assets to pay for them. If they didn’t they were accused of “red lining,” and fined very large amounts of money for each time they turned down a dead beat.

Pres. Bush asked Congress for oversight on Fannie and Freddy 14 times, and was denied it. Otherwise, none of the foreclosures would have needed to happen.

Eventually, the banks became so desperate to avoid the large penalty the government forced on them for not giving mortgages to people w/o the ability to pay them that some of them paid their assessors to upgrade the value of the houses which Fanny and Freddie wanted to force them to give mortgages on. Then came the packaging of the unpaid mortgages and the smaller repackaging, ad infinatum, until the buyers didn’t even know which bank held their mortgage. That left the buyers with houses that were vastly overrated, and are now underwater, meaning that they can’t sell the houses for the amount they agreed to pay for them.