(Bloomberg) -- The Bank of Canada’s second in command cautioned against “tinkering too much with the mortgage market” to fix housing affordability.

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Canada’s high home prices are primarily a function of a supply and demand imbalance, and the fix “will take time,” Senior Deputy Governor Carolyn Rogers said Wednesday in Toronto. While she said she was encouraged by “governments at all levels” focusing on the problem and bringing creative solutions, policymakers and regulators need to tread carefully as they adjust mortgage rules.

“Leaning too much on measures that reduce the short-term cost of financing could have long-term impact on the financial health of households, the mortgage market and the economy,” Rogers said in prepared remarks.

In recent months, Prime Minister Justin Trudeau’s government has pledged several changes to mortgage regulations, including extending the length of mortgage amortizations to 30 years, from 25, for some borrowers, and also allowing insured mortgages for homes worth up to C$1.5 million ($1.1 million).

Rogers used the average mortgage size in Canada and current interest rates to show that extending an amortization by five years might reduce a household’s payment by C$200 per month, but increase interest costs by C$50,000 over the total length of the mortgage.

Longer amortizations and reduced debt payments increase return for lenders, Rogers said, but they add to risks for both lenders and borrowers. If a borrower is in financial stress, they may be able to extend amortization, but if they’re already at the maximum, that “buffer” disappears. Lenders may demand more capital, the cost of which may be passed on to households through higher interest rates.

Rogers also pushed back against the notion that Canada’s households are struggling to cope with higher borrowing costs as they renew their mortgages at much higher interest rates than they faced during the pandemic.

“Our mortgage market has fared well through a period of economic turbulence and a sharp rise in interest rates. Arrears rates have risen but remain near historically low levels,” she said.

In the speech, Rogers said that it was “good” to see inflation return to the bank’s 2% target, and that “monetary policy worked.” Referencing the bank’s aggressive interest rate hiking cycle, Rogers said that although the process wasn’t painless, it brought price pressures to heel.