Apparently Harvard economist Paul Krugman dropped by to tell us not to get too cocky.

I agree. Just because we’re not using our homes as ATMs to the same extent as Americans, doesn’t mean that we’re not up to our eyeballs in debt. All it would take is a raise in rates and a leveling or drop in home prices for Canada to have some of the same issues.

This is particularly true for larger centres such as Toronto and Vancouver, where prices are higher than smaller urban centres and rural areas.