Economic and Real Estate News

The debate about whether Canada’s housing market is in, or might be approaching ‘Bubble’ territory seemed to have heated up again last week. A new bubble theorist emerged – Hilliard MacBeth, an Edmonton based investment manager with a book called “When the Bubble Bursts: Surviving the Canadian Real Estate Crash” which will hit the shelves in the spring. At the same time, major policy makers, in the form of the head of CMHC, the Governor of the Bank of Canada and the Minister of Finance all rejected the bubble concept but did say that are watching Canada’s housing market developments closely.

RBC and Pembina Institute released results of a survey of GTA home buyers last week. More than 80% prefer walkable neighbourhoods which are well served by public transit to more distant and car dependent suburbs or bedroom communities. But, 80% also make their decisions on where to live with cost as the most important consideration.

Equity markets had a rough week last week as the TSX lost about 1.5% of its value and the Dow was down about 1%. Analysts say that financial markets are jittery as the time approaches when central banks will finally begin to raise interest rates.

The benchmark government of Canada five year bond yield ended the week at 1.65%, down from 1.72% the previous week.

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