“They have basically encouraged people to buy houses based on cheap mortgages,” Jarislowsky, 84, said in a telephone interview from Montreal. “That has created the opposite effect of what was desirable.”
Canadian home prices and resales will grow to records this year, boosted by low interest rates, the Canadian Real Estate Association said in a report this week. Canadian new-home prices rose 0.4 percent in December from the previous month, the sixth straight gain, government figures showed yesterday.
“I am convinced there is a housing bubble in Canada,” said Jarislowsky, whose investment fund owns shares in Canada’s four biggest banks, including Toronto-based Royal Bank of Canada.
The comments by Jarislowsky, who is one of Canada’s wealthiest investors with a fortune worth C$1.85 billion ($1.8 billion) according to Canadian Business magazine, contrast with the view held by Finance Minister Jim Flaherty, who sees “no clear evidence” of a housing bubble, his spokesman, Chisholm Pothier, said this week.
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