Canada's housing agency says the weakening condo market in the Toronto region has some parallels to the crash of the early 1990s, but several factors mean the current downturn will likely be less severe.

Canada Mortgage and Housing Corporation says in the new report that a more diverse and stable economy, stricter lending rules, and an underlying shortage of homes in the Greater Toronto Area will all help soften the effects of the market pullback.

The report says GTA condo prices are declining at similar rates to the early '90s, but that it expects prices to start gaining within a few quarters, compared with around seven years of declines in the 1990s.

A shortage of housing in the current market is a big factor, compared with a period of speculative overbuilding in the last major downtu

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