The Canadian housing market is cooling but is not facing a U. S. style meltdown, builders here say.

"A few commentators have draw an a parallel between the Canadian housing situation and the extreme difficulties in the housing market in the United States," the Canadian Home Builders' Association said in a report yesterday that dismisses such comparisons.

"There is absolutely no merit in drawing such a parallel," the construction lobby said in a report that contends the pace of housing construction in Canada is merely returning to a level that is consistent with underlying housing requirements following the boom of recent years.

"The housing situation in Canada is totally different from that of the U. S.," it said. "There will be some price moderation in some markets, but there is nothing to suggest that housing markets in Canada are vulnerable to the oversupplies and plunging prices that characterize many markets in the U. S.

"We did not experience the same housing boom conditions that occurred in the U. S., and there is no reason to expect that we are in for the serious pain they are currently suffering," it said.

To support its argument that the Canadian housing market is not going the way of the U. S. market, it cited a variety of differences:

-Unlike in the U. S., underwriting standards for qualifying mortgage borrowers in Canada have been maintained at prudent levels resulting in mortgage borrowers here being much more creditworthy.

-Canadian mortgage lenders never offered low initial 'teaser' rate mortgages that led to most of the difficulties for mortgage borrowers in the United States.

-Most mortgages in Canada are held by their original lender, not packaged and sold to third parties as is typical in the United States, and consequently, Canadian mortgage lenders have a vested interest in ensuring that their mortgage borrowers are creditworthy and not likely to default.