Sometimes, it seems like Toronto and Vancouver's housing markets will never stop growing — but lately, things seem to be settling down.
Earlier this month, the Canadian Real Estate Association (CREA) reported that sales had flatlined in both cities in March and April.
And now, the Organization for Economic Co-operation and Development (OECD) is calling on Canada to clamp down on Toronto and Vancouver's markets, where a correction would represent the country's "main domestic downside risk."
Condos along Toronto's waterfront. (Photo: Artland/Getty Images)
In an economic outlook issued Wednesday, the OECD said low interest rates have sparked more borrowing and higher housing prices.
It urged Canada to strengthen rules around housing, and to focus on specific regions when it comes to regulation.
Last year, Finance Minister Bill Morneau announced new mortgage rules requiring borrowers to make down payments of 10 per cent on any portion of a home's price over $500,000, up to $1 million.
The measures, which came into effect in February, aren't expected to do much until July. That's because anyone who secured a mortgage early in the year could take until the summer to actually buy a home.
Office and apartment buildings along Vancouver's False Creek. (Photo: Amyn Nasser/Getty Images)
The OECD isn't the only organization concerned about Toronto and Vancouver's housing markets.
Scotiabank has curbed some mortgage lending in those cities, citing worries about Canadian debt levels, CEO Brian Porter told Bloomberg on Tuesday.
"We just took our foot off the gas the last couple of quarters," he said.
"But generally, Canadians have a strong ability to self-regulate and they've demonstrated that before."
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