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Wealthy Overseas Buyers Could Cushion Vancouver in a Housing Crash: Credit Union

Jen St. Denis
February 9, 2015

A new study from McKinsey Global Institute is warning that household debt levels are dangerously high in many countries, including Canada, reports REW.ca’s sister publication Business in Vancouver.

The McKinsey report calls for more action to rein in government and household debt and to cool overheated housing markets.

The Bank of Canada’s recent decision to cut interest rates to 0.75 per cent is designed to spur economic activity in the wake of plummeting oil prices. There is a danger the bank’s decision could create the potential for an asset bubble, said Chris Catliff, president and CEO of BlueShore Financial Credit Union.

However, Catliff described a set of linked trends he thinks would prevent Vancouver’s real estate market from crashing in the event of a financial downturn. Wealthy immigrants from other parts of the world continue to buy homes in Vancouver, he said. These wealthy people often do not show income in Canada, and Catliff believes this slightly skews debt-to-income measures for Vancouver.

To read the full Business in Vancouver story, click here.