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In times of economic uncertainty, it is important to focus on facts.

The housing industry experienced a number of years of unprecedented growth in housing activity and escalating prices. A continued “hot” market was not sustainable and a cyclical downturn was expected.

Canada’s housing sector remains resilient. The housing situation is significantly different than elsewhere in the world. We are not experiencing a U.S.-style housing slump.

Fact: There is nothing to suggest that housing markets in Canada are vulnerable to the oversupplies and plunging prices that characterize many markets in the U.S.

Fact: Canadian standards for qualifying mortgage borrowers are prudent. The use of sub-prime mortgages in Canada has been exceedingly limited, unlike in the U.S., where a significant amount of mortgages (estimated at 20 to 25% of new mortgages issued 2004-2006) went to people with inadequate income, few assets, and little or no credit history.

Fact: There is no “glut” of unsold new homes in Canada as there is in the U.S. Most builders pre-sell their homes, and generally “inventories” of unsold new homes are about one month’s worth of sales. Current inventories have gone up, but are still small and manageable. By comparison, in the U.S. inventories have risen and are very large.

Fact: Canadians have far less household debt and typically have much greater equity in their homes than their U.S. counterparts. Therefore, they are at much less risk of defaulting on their mortgages.

Fact: Mortgage default rates in Canada are low. By comparison, U.S. mortgage default rates in 2008 were 10 times higher than in Canada, leading to foreclosures, driving home prices down and creating a glut of resale properties.

Fact: Only 0.3% of Canadian mortgages are in arrears, compared to more than six per cent in the U.S. Lenders and mortgage insurers will work with borrowers to find manageable solutions if they are having difficulties repaying their mortgages.

Fact: Canadian banks are solid and profitable, and they are ready and willing to write mortgages for new home buyers. In fact, Canadian banks are recognized to be among the strongest in the world.