How Does A Construction Mortgage Work?
Town In BC Asking Ottawa To Loosen Up Tough Mortgage Rules
This weeks’ blog will be a little different. We thought we’d cover a story taking place in a provincial electoral district in British Columbia that is feeling the effects of the mortgage rules set out by the federal government in October 2016. The MP of Chilliwack-Hope Mark Strahl has recently come out to make a demand on Canada’s capital to make life a bit easier for buyers who want to purchase a home in his town.
In a recent press conference, Strahl said that “These changes are taking away that dream of home ownership from thousands of first-time home buyers. We have been hearing across the country that these Liberal changes are hurting Canadians.” He is not only speaking for the people of his town, but for residents across the country in general.
The changes were made so that people couldn’t take out mortgages they couldn’t afford and introduced ‘stress-tests‘ to moderate the qualifying process, which many say is a very conservative approach, but will stop many Canadians and immigrants of the future to own their home.
Strahl added that “Unfortunately, they have hurt housing markets across the country, including here in Chilliwack and Hope.” He pointed to evidence that housing sales were down in BC during the month of February, although Chilliwack has not been doing so poorly, aside from a few snowstorms that halted some progress. People are still trying to buy homes in C-H, but supply is slow and prices very high.
Cliff Iverson, President of the CREA, expressed his thoughts in the association’s recent annual report. “We believe that the Finance Minister’s recent changes to regulations affecting mortgage lending has increased housing market uncertainty among buyers and sellers,” he said. “Some of those buyers, particularly in housing markets with a lack of affordable inventory of single-family homes, may be priced out of the market by the new regulations. First-time home buyers support a cascade of other homes changing hands, making them the linchpin of the housing market.” There is genuine concern for the present and future of homebuying, as only a small portion of people will be able to afford new mortgages.
He hopes there will soon be changes to the rules.
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