Quote:
Originally Posted by Cowboy89
What's likely more practical is that house prices don't fall in nominal dollars materially but inflation and devaluation of the Canadian dollar erode their real economic value measured in hard currency back to an equilibrium over time.
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That's what tends to happen, and it already is to some extent. Real Property prices in Canada are barely above (up about 5%) where they were 7 years ago in mid-2017. And once you account for real wage growth, they're not up at all, really.
And that's what happened in the past; housing was cheap in the '90s and early 00s not because there were dramatic drops, but because prices stayed stagnant while inflation and real wage growth made them more affordable.
It's also interesting how people blame the current federal government for housing prices, but like I said, prices aren't really any higher than 7 years ago. The biggest sustained run ups in real property prices in recent decades were 2001-2008 and 2009-2017:
