I think the main fear is that exposure in those markets will affect Vancouver and Toronto via banks being hurt. CIBC, National, Canadian Western heavy with loans in Alberta vs. BMO, TD, Royal and BNS that have international exposure (significant US assets for the first three, latin America for the latter)
I'm fairly young and when I go in to do banking at certain banks/credit union, an advisor starts hyping me up on real estate. Some banks are certainly doing questionable things to get people buying homes.
While Vancouver is indeed over priced, I don't think it would totally collapse (it would drop and tank, but not catastrophic), as while Vancouver is affected by the easy mortgages, China comes into play (buying the higher end properties, CAD $ being so low, Canadian Real estate being viewed as gold, people who sell move into the middle end with their new windfall, trickle down commences). Also in terms of supply Vancouver is constrained as to the north there's mountains, to the west there's water, to the south there's the border and to the east is farmland (which is provincially protected ALR land). Its almost impossible to obtain land to build a single housing unit, and even in new build, the redeveloped brownfield properties in the suburbs, super dense (no backyard) housing stock or townhomes are being built. There's also talk of establishing something similar to the abovementioned ALR but for industrial land, with the Port authority worried enough that they have been buying up a bunch of land, much to the dismay of regional planners.
The above only applies to land + detached housing in Vancouver, which will hold up better in a crash. Non-Detached, strata, condos ect. will face pressure due to the simple fact that supply for those units is almost endless (can keep building up to the sky), the fact that people are paying 700-1Million for a unit in a tower (no land at all) is crazy. In Vancouver's suburbs, micro units (think dorm room size) are going for 80-100K. Yet even then apartment supply is questionable in certain parts of the region due to zoning and regulations, Vancouver's downtown core is going to max out eventually and is constrained building upwards in height by the view cone rules in place. Vancouver city proper is going to have an extreme battle in the near future where they will have to pit land owning NIMBYS vs high density regulations outside the downtown core.