He has added his voice to those demanding that the issue of supply should be the main focus of officials rather than the dampening of demand.
While he cautioned of the effects of cooling markets, Shenfeld wrote in a client report that rising house prices in Vancouver do not boost the wider economy as many are forced to tighten their belts to save for a downpayment.
“The lack of affordable housing for the next generation of workforce entrants could act as an impediment to business growth, or encourage businesses to locate elsewhere,” Shenfeld warns.
He also argued that housing markets do not have to see a boom and bust cycle, if the right policies are in place.
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Measures to cool Canada’s two hottest housing markets could have a negative impact on the wider economy according to CIBC economist Avery Shenfeld.