Economics
Speculators Distorting Canada Housing Boom, Economists Warn
- Tighter regulations might be needed to rein in surging prices
- But holding back crucial sector to recovery carries risk
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Canada’s housing market risks entering a speculative phase that could trigger new measures from regulators, economists at the nation’s largest banks are warning.
For months, historically low mortgage rates have combined with increased demand for bigger living spaces and a lack of supply lifting prices to new highs. Recently, signs have begun to emerge of speculators driving some of the demand, along with other buyers worried they’ll miss out from the boom. That’s raised worries prices could be moving up by too much and too fast.