Over heating Housing

Despite early signs of overheating in Canada's housing market, Bank of Canada Governor Tiff Macklem so far has no plans to raise interest rates until the economy and employment are back on track following the slump caused by COVID-19.

Speaking remotely to the combined Calgary and Edmonton chambers of commerce on Tuesday, Canada's top central banker said that the economy would continue to need monetary stimulus, likely until 2023, even though there are already signs it could be distorting the residential real estate market.

"In that low-for-long world, there are risks that housing could get carried away, so that is something we will be looking at very carefully," Macklem said in response to a question from a member of the remote audience.

Some observers have already expressed worries that the Canadian housing market is rising at an unsustainable pace, leaving critics — including some in the real estate industry — nervous of a boom, followed by a devastating bust once interest rates finally start to rise.