Global macro matters: The foundations of housing

27 November 2018 | Markets and economy


 The foundations of housing

abstract illustration

Elevated housing prices in along with a lack of affordability in big cities, have investors worried about the possibility of a recession. While it is true that the current housing conditions are similar to those leading up to the great financial crisis of 2008, the complexity of the housing market warrants deeper analysis before drawing any conclusions.

Our new Global Macro Matters paper assesses the current market valuations in Canada, Australia, the United States and the United Kingdom. We focus on the driving factors behind the elevated prices, and examine the relationship between the housing market and the business cycle to determine the likelihood of a recession after a housing crash.

Important information:

This material is for informational purposes only. This material is not intended to be relied upon as research, investment, or tax advice and is not an implied or express recommendation, offer or solicitation to buy or sell any security or to adopt any particular investment or portfolio strategy. Any views and opinions expressed do not take into account the particular investment objectives, needs, restrictions and circumstances of a specific investor and, thus, should not be used as the basis of any specific investment recommendation.

While this information has been compiled from sources believed to be reliable, Vanguard Investments Canada Inc. does not guarantee the accuracy, completeness, timeliness or reliability of this information or any results from its use.

Information, figures and charts are summarized for illustrative purposes only and are subject to change without notice. All investments, including those that seek to track indexes, are subject to risk, including the possible loss of principal. Diversification does not ensure a profit or protect against a loss in a declining market.

 The foundations of housing