North American stock markets continue to reach new highs every day but don’t tell anybody in organized real estate about it. It’s not something the industry wants to hear. But here you go: By the end of last year real estate prices had climbed about 85% over the previous decade, according to the Teranet/National Composite Bank House Price Index.
In the dozen years since the beginning of the millennium, home prices rose 225%. Those prices were largely financed by household debt which rose to 160% of family income in 2012 from 100% in 2000, says Benjamin Tal, deputy chief economist for CIBC in Toronto. “House prices in Canada continue to defy gravity.”
There is good reason for that.
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