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The report says the market will cool but it will happen “gently” and cites mortgage costs, not just home prices, as the principal determining factor for the market for future buyers.

“We believe that the more prudent mortgage underwriting in Canada than in the United States, headlined by the very small number of subprime loans here, has prevented the stockpiling of high-risk mortgages by lenders,” states the report.

Others argue the Canadian market bears striking similarity to the U.S. market.

“It’s a lagging indicator,” says David Madani, an economist with Capital Economics, about mortgage arrears. He says the arrears come when the market starts to fail. “The first sign of trouble in the U.S. was declining home sales, then a year later prices fell and then people started missing payments.”

Much has been made of Canada’s tighter loan standards with none of the NINJA loans — no income, no job, no appraisal — that were found in the U.S.

Still, Canadians are holding onto records amount of debt. Statistics Canada said debt to disposal income went down slightly during the fourth quarter of 2013 but at 164% it remains very close to an all-time high.

“It’s an extraordinary level next to household income and interest rates don’t have to spike,” said Mr. Madani. “Even if they go up moderately, it can have big impact on affordability.”

With little demand from new buyers, prices would ultimately sink and leave people vulnerable as they try to renew mortgages.