Housing market turmoil more of an issue for consumers than banks: Analyst

Now that all major Canadian banks have released their most recent quarterly earnings, one analyst said he is concerned about the health of Canada’s housing market due to the impact it could have on consumers.

Ebrahim Poonawala, the head of North American Banks Research at Bank of America Securities, said in an interview with BNN Bloomberg Tuesday that he is watching the housing market closely. However, he said the focus has more to do with the impact on consumers rather than the exposure of Canadian banks. 

“If there is a significant negative impact on Canadian home prices and a more lasting impact on activity, we worry about what that means in terms of consumer behaviour,” Poonawala said. 

“Losses within the mortgage market may be limited, but its impact on consumer spending is something that we are closely watching.”