Global macro matters: The foundations of housing
14 January 2019 | Topical insights
Elevated housing prices in along with a lack of affordability in big cities, have investors worried about the possibility of a recession. While it is true that the current housing conditions are similar to those leading up to the great financial crisis of 2008, the complexity of the housing market warrants deeper analysis before drawing any conclusions.
Our new Global Macro Matters paper assesses the current market valuations in Canada, Australia, the United States and the United Kingdom. We focus on the driving factors behind the elevated prices, and examine the relationship between the housing market and the business cycle to determine the likelihood of a recession after a housing crash.