A new exuberance report from the U.S. Federal Reserve claims that Canada has the second-worst housing bubble out of all the G7 nations.
The only country ahead of Canada in terms of price growth beyond fundamentals is Germany. The report also notes that both counties have been in the bubble for far too long, with Canada’s housing market bubble starting 24 quarters ago.
While Germany’s bubble might have lasted a little longer than the one in Canada, ours has grown much larger. The report states that since 2005 housing prices in Canada have risen by 173 percent.
Behind Canada and Germany, Luxembourg also has a fairly long-lasting housing bubble, and other nations like Croatia and Belgium may be just beginning theirs.
While this bubble is good for anyone selling their home after having it for a long time, these bubbles often come with a correction period and the longer lasting the bubble, the more intense the correction can be.
Source: Better Dwelling