Homes in Canada are 63% overvalued and the level reaches about 50% in Australia and Norway, Deutsche Bank said in a report yesterday.

The Federal Reserve’s new economic stimulus plan involves printing vast sums of money to help people buy homes, but over the next year the programme could do more to boost the economy by lifting stock prices.

US housing construction rose last month to the highest since January and the number of people continuing to collect jobless benefits fell to the lowest in two months, signs the economy is beginning to strengthen.