Western Canada is the last hold out for crazy price appreciation. Edmonton house prices have already slipped, but it's a panicked buying mania next door in Saskatchewan. I just sold my 2000 sq foot bungalow for $700k, $40k over asking price. I paid 530 for it 18 months ago. Average year over year house prices here are up 50%. I signed that sales contract so fast, the pen was smoking. It's like Orange County 3 years ago, except I'm the only one who's seen the movie! Banks are touting their new plans to finance down payments, give you 40 year mortgages, etc. Mortgage lending used to be very conservative here, but like happened in the US, logic goes out the window when the easy money is flowing. I wish I could short houses here, but the economy is on fire- for now. It's kind of mind boggling.
Sorry, bit of a rhetorical question - I personally think that the Alberta housing bubble is set to pop, or at least trend downwards.
Yup, lending in Canada has certainly become quite interesting, even for "prime" loans. My personal favorite was CMHC deciding to begin insuring 100% LTV rentals, particularly at a time when I could not see how one could make that work economically (e.g. purchasing an expensive home 100% LTV and managing to rent it out for more than the mortgage payment).