Canada is primed for a big drop in housing prices, according to a new survey of data by Bloomberg.

According to the financial data and news firm’s recently launched Housing Bubble Dashboard, both Canada and New Zealand top the list of countries due for a correction because of high house price-to-rent and house price-to-income ratios.

Both ratios are indicative of a bubble that could burst, said Bloomberg economist Niraj Shah, who crunched the numbers from the Organization for Economic Cooperation and Development and the Bank for International Settlement.

Recent moves by federal and provincial governments to keep house prices in check — including the mortgage stress test and B.C.’s tax on foreign buyers — haven’t been enough to relieve the pressure, Shah added.

“While this all should help contain the housing bubble, the dashboard suggests house prices still remain substantially elevated,” said Shah in an email interview.

Shah created the Bubble Dashboard earlier this year in response to a series of rate cuts from central banks around the world. Those cuts, designed to stimulate economies, could also have the effect of further boosting housing prices, Shah added.

“We decided to put together the Housing Bubble Dashboard in light of the new round of global interest rate cuts. That risks exacerbating existing housing bubbles,” said Shah.

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In Canada, the Bank of Canada has held its key interest rate at 1.75 per cent since October 2018. This week, the U.S. Federal Reserve is expected to cut its key rate for the first time in a decade, with many economists predicting a cut of half a per cent.

Still, RBC senior economist Robert Hogue, who studies Canadian housing prices, isn’t convinced the bottom’s about to fall out of the market.

“This is telling me that there’s an affordability problem, not that there’s going to be a big correction. Hedge fund people have been saying for a decade that we’re in a bubble and that there’s going to be a big correction, but that hasn’t happened,” said Hogue, who added that national numbers hide the real problem with housing affordability in Canada.

“Really, the numbers are reflecting Vancouver and the Greater Toronto Area, and we’ve seen a bit of a cooling off in both those places already. And that’s a healthy thing. It’s better to have a gradual, small correction than a sudden one,” said Hogue.

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The mortgage stress test, implemented in early 2018 by the Office of the Superintendent of Financial Institutions, means that borrowers with a down payment of more than 20 per cent, who don’t require mortgage insurance, have to show they can afford a mortgage with an interest rate that’s two percentage points above the rate being offered, or the Bank of Canada’s 5-year benchmark, whichever is higher.

Those who do purchase mortgage insurance have to show that they can afford the mortgage rate being offered, or the Bank of Canada’s 5-year benchmark, whichever is higher

In 2016, the B.C. government added a 20 per cent tax for foreign buyers of property in the Vancouver area.