COLUMNISTS While the US housing market has crashed over the last few years, the Canadian housing market has remained relatively strong. On a trip to Toronto last week, I learnt about three important features of that market that have helped Canada avoid the boom-and-bust cycle in residential housing.
First, Canadian banks routinely require home purchasers to make down-payments of at least 20 per cent of the purchase price of their home. Even in the government programmes to help low-income families buy their first homes, the minimum down-payment is still 5-10 per cent of a home’s price. With substantial personal net worth at risk, Canadian homeowners are very reluctant to default on their mortgages.
