The average house price in Canada has increased from around $300,000 in the second quarter of 2007 to over $360,000 at the end of 2011.
But home equity has decreased in that time period.
Which means that increasing home values have given Canadians the illusion that they are wealthier. They have been... on paper...for the time being. Simply put, Canadians have been borrowing faster than the increase in their homes value. A sure sign of a debt induced bubble.
In this new economy, debt will continue to grow, as will house prices. Better just get used to it.
ReplyDeleteUntil the NEW ECONOMY produces a wage boom (because it has not yet) debt will need to grow so house values can increase.
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