I saw a post on America Canada on the housing values of canada vs the trend in other countries. I also saw the home construction vs prices chart somewhere else(can't remember exactly where at the moment.) The argument is that the canadian housing market is like a tennisball rather than a bubble, whereas it has been whacked by the recession and returning it's original shape based on the fundamentals.
This view makes intuitive sense, and there has been little debate over whether Canada is in a bubble or not. Living near Vancouver I have seen housing values double in the last 10-12 years and prices in Vancouver is now 800K on average with a median household income at about 65K. This seem a bit out of line, since if the median family cannot afford a median house, either the median family has to earn more or the median house has to cost less or a lot of credit needs to be created. Since supply is still tight and credit seems to still be flowing, it's not surprising to see prices making new highs. However, this cannot be sustainable, as the American experience tells us. A credit bubble will eventually need to be deleveraged, and prices of the collateral eventually has to fall.
While I have been saying for years that housing prices will come down, I do not expect it to happen soon. Sentiment is still running high that houses will go up, and these things can go against the fundamentals for a long time. We'll see what happens, but I suspect a lot of people putting money down now will come to regret it later.