Economists, Realtors and academics are at odds over the possible scope of a Canadian housing bubble, and the federal party leaders are offering few fresh ideas on how to cope with a potential crash.

During the leaders' debate in Calgary Thursday night, the politicians were asked how they would guard against a potential burst in the housing market and if imposing limits on foreign ownership is a possible solution, but they mostly fell back on broader policy planks.

Conservative Leader Stephen Harper said that even though some Canadians are over-extended, the overall picture is one to "celebrate" at a time of global economic instability.

Harper calls housing a 'positive story'

"I think the housing story is a very positive story in this country," he said. "You know, you look around the world where they have seen all these crashes, a lot of them centred around the housing market. In Canada, we have seen home ownership rise to record levels."

Harper cited incentives such as increasing the home buyers' plan, tax-free savings accounts and other measures to help people invest in their homes. The Conservative platform includes a pledge to spend half a million dollars to collect data on how many residential properties are being bought by foreign investors.

Party leaders during debate

'I think the housing story is a very positive story in this country,' Harper said during the leaders' debate. (Canadian Press)

It has been an issue of heated debate, especially in Vancouver and Toronto where home prices have skyrocketed.

Liberal Leader Justin Trudeau said it's important to make sure household incomes and salaries rise along with housing prices, and he said investment in more construction of rental units is required to address a shortage.

Asked if he would restrict foreign ownership of homes in Canada, Trudeau acknowledged there are "concerns" around it, but said there is not enough accurate data to understand what's happened.

"One of the reasons for that is Mr. Harper has chosen to cut the long-form census, and it leaves us with less understanding of very real needs," he said.

NDP Leader Tom Mulcair turned the issue back to his signature $15-a-day child care promise and federal minimum wage.

Crash on the way?

Hilliard MacBeth, an Edmonton-based investment adviser with Richardson GMP Ltd., disagreed with Harper's rosy perspective and is convinced a "dangerous" housing crash is on the way.

He said the leaders likely ducked the question because of a lack of concrete data. But he warned that a collapse is on the way when debt-ridden homeowners face higher interest rates — and it may be too late to rein in the risk.

"If anybody directly addresses it, it might be the cleanup," he said. "It's a dangerous bubble, and managing the burst of the bubble, the unwind of the excess, is going to be the challenge."

Cameron Muir, chief economist for the British Columbia Real Estate Association, said talk of a housing bubble and foreign buyers being to blame is overblown. His studies suggest a negligible impact on home prices, as off-shore investors are relatively small in number and mostly geared to the luxury market.

"The housing bubble is typically a Canadian reaction to a housing market that is suddenly doing well, there must be something wrong," he said. "We've been several years in the doldrums in the housing market in this part of the world. We have a good year and suddenly there's a problem again."

Residents and citizens with Chinese names are often confused with foreign buyers, skewing a perception that's not borne out by facts. Rising prices are driven more by other market factors, such as densification policies and scarce properties, he said.

Tsur Somerville, director of the University of British Columbia's Centre for Urban Economics and Real Estate, said the foreign investor issue is not one that should be addressed with a countrywide policy to impose limits.

"I can think of places where the last thing you would want would be to make it more difficult for foreign investors to buy property. I don't think resort communities necessarily want that," he said. "If I'm Mont Tremblant, do I want to make it really hard for Americans to buy condos?"

As for the housing bubble, he said there are different stories in different parts of the country, linked to the local economies. While there is a federal role around lending and household debt policies, others such as restrictive land use fall into local jurisdiction, he said.