VANCOUVER (NEWS1130) – A Canadian economist is breaking ranks and predicting a much bigger drop in home prices than others in his field.

David Madani expects housing prices to fall 25 per cent “over the next few years,” with Vancouver leading the way. That’s a far bigger drop than the most pessimistic of the big banks, TD, which forecasts a 10 to 15 per cent decrease.

Madani, who runs Toronto-based Capital Economics, says “a potentially severe housing correction has already begun in Vancouver,” with a 1.2 per cent drop month-over-month that he says is the worst since the financial crisis four years ago.

“Home prices have not fallen by this much in any single month since during the height of the global financial crisis back in 2008,” says Madani.

He suspects the latest round of mortgage-rule tightening “has had a much greater impact in Vancouver than previous tightening measures.”