A New Kind of Crazy in Canada Housing
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There’s lots of crazy stuff going on in the world these days, both global
finance and geopolitics-wise, but one of the crazier elements of the former
has been the continuation of what, for many years, has appeared to be an
unstoppable asset bubble (yes, that’s an oxymoron) in Canada’s housing market
that, recently, appears to be veering toward a pin.
This chart of home prices from Vikram
Mansharamani serves as a timely reminder of how nuts it’s been north of
the border and how much potential currently exists for an unpleasant change
in direction for that light violet curve.
 
Surging household credit, soaring home prices, tumbling oil prices, and
now an admission
by the Bank of Canada that they really don’t understand what’s been driving
Canada’s housing market make this a situation that is just begging for a
resolution of some sort.
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