Flaherty won’t intervene in housing market but keeping close tabs
Finance Minister Jim Flaherty says he has no intention of interfering in the housing market “at the time being” but plans to meet with developers to learn more about what could be driving the sector’s recent steam
Following a meeting in Ottawa with private sector economists, Mr. Flaherty said he was urged to take a closer look at the sector.
With commitments to near zero interest rates for the near term, Mr. Flaherty noted that the Bank of Canada has no policy room to respond to the housing market. As a result, any response would have to come from the Department of Finance, though he stressed that the government has no plans to interfere in the market at this time.
“Some of the economists this morning suggested that I have some conversations with some people in the building industry – some more conversations – because of what we’re seeing in certain parts of the country: a re-acceleration of housing prices,” he said.
“I do speak to people regularly in the business and I’m going to do more of it now, because I want to ensure that this isn’t just a temporary bubble. One theory is that we’re pulling forward housing sales by the reality that eventually interest rates will go up and so that some people who perhaps should be waiting a bit are going ahead and buying, but this is speculation and we’re going to have to look into it more. But I have no intention of interfering in the market at the time being.”