Borrowers in Canada also have reasons for prudence: mortgage interest on primary residences is not tax deductible in Canada and (in most provinces) lenders have full recourse to borrowers in the event of default. Thus, a combination of factors contributes to a more stable mortgage market. With Canada's economic recovery, the housing sector has been experiencing a strong rebound.
Private sector productivity growth may also help, but does not solve the issue. First, pensions tend reflect wages, through the accrual mathematics and through indexation, so that when productivity gains boost wages, pensions tend to follow, with a lag, but eventually almost one to one. And second, when private sector wages increase, so do the wages of health care professionals on public payrolls.