Central bank warns of Toronto, Vancouver housing risks

Ottawa

BANK of Canada governor Stephen Poloz has given one of his bluntest warnings to date about the country's housing boom, saying that Vancouver and Toronto buyers should realise strong price gains probably can't be sustained by economic fundamentals.

"This suggests that prospective homebuyers and their lenders should not extrapolate recent real estate performance into the future when contemplating a transaction," Mr Poloz said from Ottawa after publishing a semi-annual Financial System Review (FSR) on Thursday.

Policymakers have warned for years that Canada's inflated housing market poses the biggest risk to the country's financial system. Thursday's report suggests recent gains in the hottest segments may h…