What's in Store for 2009?

This is a recent article found in the Jan./Feb. 2009 Mortgage Journal magazine where the Senior Economist-CIBC World Markets Inc., Benjamin Tal, had this to say about the current housing market in Canada:

"House prices in Canada will continue to ease in the coming months. But the triggers that led to a freefall in Canadian real estate markets in the early 1990's and today in U.S. markets don't exist. Recently, the Canadian real estate market moved from a confident seller's market to a more muted balanced market, and by early '09, will turn, for the first time since 1995, to a buyer's market. When measured against income, the Canadian real estate market has overshot, but just a five to seven percent drop in prices from peak levels should bring equilibrium back, which is a fraction of the twenty-five percent overshooting seen in the U.S. by mid 2006.
At it's core, the U.S. meltdown is a subprime story. Eliminate subprime from the U.S. housing market, and instead of the most severe house price meltdown since the Great Depression, you get a trivial moderate cyclical slowing--something along the lines of what we are currently experiencing in Canada."