The Time is Now: CIBC’s Victor Dodig Calls for Action on High Home Prices
As the Canadian government continues to grapple with the issue of high home prices, Victor Dodig, Chief Executive Officer of the Canadian Imperial Bank of Commerce (CIBC), has sounded the alarm. In a recent interview on BNN Bloomberg Television, Dodig emphasized that "the time is now" for policymakers to take action and address the soaring costs.
The Urgent Need for Action
Canada’s housing market has been experiencing unprecedented growth, with prices jumping over 25% in November compared to the previous year. The Canadian Real Estate Association (CREA) attributes this surge to a historic supply shortage, driven by population growth through immigration and births. Dodig notes that these rising costs have significant implications for Canadians, making it increasingly difficult for them to access affordable housing.
Possible Solutions
Dodig proposes several solutions to alleviate the pressure on Canada’s housing market:
- Improving Transportation Links: Enhancing transportation links between urban centers can help reduce the need for lengthy commutes and encourage people to live closer to work.
- Increasing Rental Stock: Increasing the availability of rental properties can provide more options for Canadians who cannot afford to buy a home, thereby reducing competition in the market.
- Speeding Approvals for New Construction: Streamlining the approval process for new construction projects at the municipal level can help increase the supply of housing and meet growing demand.
- Federal Incentives: Providing federal incentives to accelerate approvals for new construction can encourage developers to build more homes, thereby addressing the shortage.
A Collaborative Approach
Dodig emphasizes that these solutions require a collaborative effort from policymakers at all levels – municipal, provincial, and federal. "If policy makers came together to chart out a plan, I think you can get things going quite quickly," he said.
CIBC’s Response to Covid-19
Interestingly, CIBC has recently suspended its plan to return workers to offices in January due to rising COVID-19 case counts and concerns about the omicron variant. Dodig notes that the bank will reassess its return-to-office plans in early January and follow guidelines from public health authorities.
A Call to Action
In conclusion, Victor Dodig’s message is clear: the time for action on high home prices is now. By working together, policymakers can implement solutions that provide near-term relief and address the underlying drivers of the housing market’s growth. As Canada continues to navigate the complexities of its housing market, it is essential that all stakeholders – governments, developers, and lenders – collaborate to find a solution.
Additional Recommendations
- Implement policies to encourage density-friendly development in urban areas
- Invest in affordable housing programs for low-income families
- Provide incentives for builders to construct more units
By implementing these solutions, Canada can work towards creating a more sustainable and equitable housing market that meets the needs of its citizens.
Sources:
- Bloomberg.com – "Time is now’ to act on high home prices, CIBC’s Victor Dodig says"
- Canadian Real Estate Association (CREA) – Housing Market Update
- Government of Canada – Affordable Housing Strategy
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