National Bank Financial has warned that the flow of foreign money into Canada’s real estate markets could begin to ease as governments such as China’s take action, increasing the threat of a correction in the hottest cities. Foreign investment in housing in Toronto and Vancouver is frequently flagged as a risk but with limited data on how large the slice of foreign ownership is; it is hard to make an accurate estimate of the potential correction. National Bank believes that the market could be overvalued by between 10 and 30 per cent.

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