IRVINE, CA-Auction.com released a statement Wednesday in response to a warning from analysts at Fitch Ratings, London and New York, about the ongoing risk of a Canadian housing bubble that would recall the U.S. collapse of 2008. Both assert that there is a real risk.
Fitch's warning was released Tuesday, and Auction.com responded later in the day. Fitch says that Canada's top six banks have reduced the size of denominators in their risk-based capital measures.
This has the effect of lowering the amount of capital banks hold against residential mortgage exposures. The statement went on to say that Canadian home prices are likely “nearing a plateau” and “could exhibit some weakness,” in the near future.
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David Phillips
David Phillips is a Chicago-based freelance writer and consultant with more than 20 years experience in business and community news. He also has extensive reporting experience in the food manufacturing industry for national trade publications.
