What Does Canada’s Housing Bubble Mean for the U.S.?

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If Canada’s housing bubble bursts it could have dire consequences for the United States economy. Currently, debt in Canada is cheap and citizens are taking on more of it. In addition, banks are giving out longer amortization periods on loans. With the Canada being the United States’ largest trading partner this could trigger a domino effect on the housing market on both sides of the border, leaving both economies in trouble.

KEY TAKEAWAYS:

      • Debt in Canada is cheap
      • Canada’s debt will stay the same or increase as the housing market drops.
      • Canada’s and U.S’s economy are intertwined.

“If Canada’s housing bubble bursts before ours does, it could trigger a domino effect that sends us spiraling down sooner than anticipated. If it breaks after ours, or at the same time, it will take away the cushion that we had in the previous recession, making the effects of this one much worse.”

http://www.valuewalk.com/2016/10/canadas-housing-bubble-mean-u-s/

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