The Bank of Canada governor, Stephen Poloz, testifying before the senate banking committee said that Canada's housing market is not in a bubble and not likely to suffer a sudden and sharp correction in prices, unless there is another major global shock to the economy.

The central banker said he believes the most likely scenario is a soft landing where home prices stabilize, although he acknowledged that an imbalance in the market and high household debt remain key risks.

"It looks expensive," he said of home prices. "But which markets are expensive? Well those markets have been expensive my whole life,"he said, noting that Toronto and Vancouver both absorb high rates of immigration.

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