Canadians don’t like to use the word "bubble" when referring to their national housing market. But except for a brief 12 months during the heart of the global recession, it’s been on a wicked tear since the 1990s.

In Vancouver, which is the most costly metro market in Canada, the recession deflated home prices about 15 percent in 2008, then corrected for that 15 percent over the next 18 months.

In fact, if you bought a home in the Vancouver area back in 2005, you would have experienced 65 percent equity growth in that property since then.

Compare that to hard-hit areas in the United States where home prices have fallen to 2005 levels and beyond — and remain there.

I’ve interviewed Bryan Yu, an economist with Central 1 Credit Union in Vancouver, for this column in the past. Like most economists he takes a data-rich viewpoint of what has happened to the Canadian housing market and he emphatically asserts, "Our view is that there wasn’t a bubble in Canadian housing."

So, in a nod to the Canadians, I’ll just say this, that country’s housing market has simply been bubblicious.

Or, it was until recently.

To quote Bob Dylan, "Something is happening here, but you don’t know what it is, do you, Mister Jones?"

That something is an unexpectedly prolonged slowdown in Vancouver housing sales, which has caused housing prices to recede slightly — a very rare occurrence.

At this point, Canadian analysts don’t appear too worried about what’s happening in Vancouver. But I wonder if this city, which I have visited often and enjoy immensely, is the canary in the coal mine.

There are, indeed, ill winds blowing.

The economy is slowing down (GDP is expected to drop to 2 percent in 2013). The federal government purposely put a brake on housing markets by changing mortgage amortization periods.

Recent blips in China’s economy are also a problem, as some Canadian housing markets have been sustained by either Asian investment or from Asian-Canadian citizens reliant on business income in their or their parents’ birth countries.

The average price of a home in Vancouver is now $606,000, which "isn’t that expensive," said Eugene Klein, president of the Real Estate Board of Greater Vancouver.

I know that statement seems either cynical or bizarre to many of us in the United States, but Klein was making a comparison to individual Vancouver markets where prices still average between $900,000 and $1 million for an average, detached, single-family house.

Neither price tag was daunting, as Vancouver buyers continued to shell out money for new home purchases as rapidly as they have done for the past two decades. Things, however, do change, even in Canada, and this dedication to having a Vancouver residence to call one’s own finally hit a wall earlier this year.

"It’s been a different market for us," said Klein, who tried hard to sound complacent. "About four months ago we had a sales-to-listing ratio of 19 percent, which means 19 out of every 100 homes for sale had transacted. What we have seen since then is a slowdown in our market where we have gone from 19 percent to 11 percent to 9 percent and now we are at 8 percent, so 8 out of every 100 homes are selling."

To which he added, "There are pockets of Vancouver that are showing a lot more slowdown than others. Richmond and the west side are twice as slow as East Van (East Vancouver) or Port Moody. Right now on the east side of Vancouver, it takes 29 days to sell a detached home, whereas on the west side it was over 63 days."

The last time it took 63 days to sell a home in Vancouver was about five years ago, during the global recession days.

Economist Yu’s viewpoint is similar. "The number of houses sold in 2012 was down from 2011," he said. "There are now about 18,000 units for sale on the market. We have dropped into what is called a buyer’s market."

Everyone seems to agree the Vancouver market has slowed to a level that indicates some downward pressure on pricing. If the market wasn’t overexuberant to begin with, how do you explain the change?

"If we look pricing, we have seen very little decline, about a 4 percent point drop since May of this year," Yu said. "We have seen a slowing in sales activity for quite some time now. This is not something that is new. We have had slower sales since the beginning of the year in the Vancouver market. In more recent months, we have seen a sharper decline, primarily because of the new mortgage rules. That has tightened up some lending on the credit side."

Klein has a different take.

"With that sustained downward activity, you might see a change in price, we haven’t seen that," Klein said. "That largest price fluctuation that we have seen is between 4-6 percent, which (has) been in areas like Richmond and on the west side, which had the highest price increases due to a record number of transactions.

"In the Richmond area a year ago, detached homes rose $100,000 a month for four consecutive months. In order for the market to breathe, you need the market to slow down. That’s what we are experiencing now."

To which he added, "If you look at the larger picture, what we have now is a slowdown in activity yet stable pricing. I don’t know if pricing will change. We have low interest rates, positive job growth, more interest in raw materials from Canada and a large infrastructure investment from the Olympics."

Yu is one observer who expects pricing to change over the course of 2013, but not by much, about a 5 percent to 7 percent decline in the metro Vancouver area.

Although the Canadian housing market was bubblicious, don’t expect the kind of price collapse that Americans saw in the Great Recession. Part of the severity of the decline in the U.S. was due to a combination of subprime mortgages that shouldn’t have been made and so many people losing jobs. People simply had to give up their homes.

Canada has neither of those problems, so no matter how long it takes to sell a home, Canadian homeowners don’t have to sell. They can just wait until bubbliciousness comes back in fashion.

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