Pressure is growing on Ottawa to take action on housing prices as banking executives are joining economists and global think-tanks in sounding the alarm about the runaway markets in Toronto and Vancouver.
The latest call for action came from National Bank of Canada chief executive Louis Vachon, who told Bloomberg on Wednesday that Canada should eventually return to a 10 per cent minimum down payment for mortgages, from the current five. That follows comments from Scotiabank’s CEO, Brian Porter, that revealed the bank is scaling back its mortgage lending in Toronto and Vancouver because of concerns about housing prices.
New data Thursday from the Real Estate Board of Greater Vancouver showed prices in city spiked 29.7 per cent in May, compared to the same time last year.
The Department of Finance said in a statement to the Financial Post that it is watching what is going on in the housing market and “prepared to take further action if required,” but that there are no new measures planned for now.