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Vancouver’s eye-popping housing market is seemingly defying gravity, with sales in January rising nearly 32 per cent — the second busiest January on record.

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The tech economy in Vancouver and across Canada has never looked brighter. Yet the reality, in some respects, has never been bleaker.

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With prices in Metro Vancouver slowly creeping up to the $2 million mark, the searing pace of housing in the city has many worried.

But the state of the market makes sense if you look at the market as a U.S. dollar play, say economists Derek Holt and Dov Zigler of Scotiabank. Because so much of the market is being fuelled by foreign buyers, many of whom purchase in U.S. currency, the Canadian dollar price surge makes a lot of sense.

The Canada Mortgage and Housing Corp. estimates that foreign buyers own 3.5 per cent of the condos in Metro Vancouver, up from 2.3 per cent in 2014.