01 Dec Time to relax mortgage regulations, Canada home builders urge.
Original article via BNN Bloomberg. Click here to read.
Canada’s home builders are urging the federal government to loosen mortgage-lending restrictions that have helped cool housing markets this year.
Executives at Mattamy Homes Ltd., North America’s largest closely held home builder, said the rules have brought about the desired soft landing and aren’t needed as much now that interest rates are rising. The Canadian Home Builders’ Association said the rules are hitting millennials and struggling markets like Calgary particularly hard.
The rules, put in place in January, require even those with a 20 per cent down payment, who don’t need mortgage insurance, to prove that they can make payments at 2 percentage points above the contracted rate. The so-called B-20 stress tests already existed for insured mortgages. By April, the average home price in Toronto had tumbled 12 per cent from the same month the prior year, though has since stabilized.