Studying Islamic Finance

السلام والازدهار العدالة المجتمعي
You are visiting a blog associated with an online noncredit course studying the topic of Islamic Finance, moderated by John Wiley Spiers. Feel free to participate in our discussion, and if you are interested in taking the course visit

Friday, January 17, 2014

Housing Bust in Canada

Mish Shedlock is notable for getting credit as a component of a lack of hyperinflation in that great debate.  He is mystified as to how his predictions of a real estate bust in Canada have not yet occurred.
No one knows for sure precisely when any bubble will burst. I got the US housing bubble correct but missed Canada by a mile.Read more at
This is easy: Canada requires a 20% down payment and there is no mortgage deduction on Canadian taxes.  So those seemingly insignificant points actual have profound effects.

For a decade most homes in USA were bought with nothing down, sometimes even negative LTV, but in Canada someone actually had to demonstrate enough discipline to save a down.  A much more responsible customer base.

Next, with mortgage interest deduction on taxes in USA, buying a house is a tax dodge, making the reason for having a house to that extent abstruse.

When it comes to usury (interest) even slight rules can have large effects.

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