The housing markets in Toronto and Vancouver require government intervention the chief executive of RBC said Thursday.

Dave McKay said that he is “increasingly concerned” about the two hottest Canadian housing markets citing high demand, low supply and low interest rates among the “unhealthy combination of factors” that are concerning.

He told shareholders that he is confident in the strength of the lender’s mortgage book but warned that the economy could be damaged if consumer spending decreases due to higher housing costs.

As for a solution, McKay said that it will need several measures from all levels of government.

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