Most households anywhere in the world at any time are "heavily weighed in Real estate with minimal to no other financial assets"!
I'm not sure how it follows that a housing crash would make a currency fall. Currency forwards are set by interest rate differentials, so you're essentially saying that a housing rate fall would result in significantly higher interest rates. I'm not sure that makes any sense?
I think the rationale is that interest rate gets cut and cad offers less opportunity on the forward and the spot comes down. But I don't understand fx all that well.
RE: Best way to bet against Vancouver Canada real estate bubble? Real estate in Vancouver BC, Canada has almost doubled since the date of this thread - May 2013.