Economy 52,845 Posted November 3, 2016 Share Posted November 3, 2016 https://www.google.ca/amp/business.financialpost.com/personal-finance/mortgages-real-estate/new-mortgage-rules-will-reduce-the-risk-a-housing-crash-would-pose-to-canadas-economy/amp The Housing boom in Canada started 16 years ago in the year 2000 and accelerated even more after 2009... By most measurements Canadas housing market is more heated and inbalanced than the US Housing market in 2007 The Canadian Government has already intervened 5 times before to make lending rules tighter by increasing minimum downpayments and lowering max amortization periods The lastest change now to add is a new stress test. Banks must now make the assumption that interest rates will rise when determining whether or not their customers can afford the loan. If the person fails the stress test the bank is not allowed to lend them a mortgage. Link to post Share on other sites More sharing options...
Economy 52,845 Posted November 3, 2016 Author Share Posted November 3, 2016 @Luc Does northern Europe have this? I know Norway, Sweden, Denmark, Finland and Northern Europe in general have their own housing inbalance though i dont think its as bad as ours Link to post Share on other sites More sharing options...
Anastasia 6,093 Posted November 3, 2016 Share Posted November 3, 2016 I don't think I'll be able to buy a house until I'm 50 FATWIFE, First Lady Of GGD Link to post Share on other sites More sharing options...
DeanWinchester 41,390 Posted November 3, 2016 Share Posted November 3, 2016 Getting a house/paying mortgage is so tough but then I'm reminded that apartment rates now exclude utilities and have been off the roof as well so might as well keep this one Flyin' like a 1000 Doves Link to post Share on other sites More sharing options...
Luc 4,776 Posted November 3, 2016 Share Posted November 3, 2016 5 minutes ago, Economy said: @Luc Does northern Europe have this? I know Norway, Sweden, Denmark, Finland and Northern Europe in general have their own housing inbalance though i dont think its as bad as ours I don't think so. Generally the rules here are still too lenient on mortgage and the left-right government coalition isn't really doing their best to prevent housing booms. Amsterdam's housing prices are already beyond pre-crisis levels and rising double digits % annually. At least Canada is doing something. It would be interesting to see if they could pull of a Germany that just never gets a housing crisis. Link to post Share on other sites More sharing options...
Sepsami 20,967 Posted November 3, 2016 Share Posted November 3, 2016 I read "for homos" Link to post Share on other sites More sharing options...
viniferrett 16,684 Posted November 3, 2016 Share Posted November 3, 2016 1 minute ago, Sepsami said: I read "for homos" lmao me too was like wtf Link to post Share on other sites More sharing options...
Smarticle 3,178 Posted November 3, 2016 Share Posted November 3, 2016 So does this mean it's harder to get a mortgage now? RIP in single home purchases for lower income individuals Justice for Grigio Girls!!! Link to post Share on other sites More sharing options...
Anastasia 6,093 Posted November 3, 2016 Share Posted November 3, 2016 On 11/2/2016 at 9:25 PM, A Gaga Lad said: Getting a house/paying mortgage is so tough but then I'm reminded that apartment rates now exclude utilities and have been off the roof as well so might as well keep this one It's insane. They should be looking out for us, its just gross. FATWIFE, First Lady Of GGD Link to post Share on other sites More sharing options...
DeanWinchester 41,390 Posted November 3, 2016 Share Posted November 3, 2016 1 minute ago, Anastasia said: It's insane. I'm lucky enough to live with family while I go to school here but I don't want to be living with them for the next 7 years, and I stress about how I'm even going to get on my feet after that anyways. I already work enough hours to stress me out and help pay for school, how the f*ck I'm supposed to also pay for an apartment later is beyond me. They should be looking out for us, its just gross. It's ridiculous. And it has a lot to do with offshore buyers who pay cash in full and there are no regulations about it. We were lucky to have found the one we have now. We're at the edge of the city, but beggars in Toronto can't be choosers. I'm getting scared of my mortgage really. If it increases then Flyin' like a 1000 Doves Link to post Share on other sites More sharing options...
Economy 52,845 Posted November 3, 2016 Author Share Posted November 3, 2016 21 minutes ago, Luc said: I don't think so. Generally the rules here are still too lenient on mortgage and the left-right government coalition isn't really doing their best to prevent housing booms. Amsterdam's housing prices are already beyond pre-crisis levels and rising double digits % annually. At least Canada is doing something. It would be interesting to see if they could pull of a Germany that just never gets a housing crisis. Our Government intervened 5 times in total in seperate occasions but it never worked. Or maybe it did work... perhaps the bubble would be bigger without the changes... Changes so far: - Max refinancing of equity now 80% - Minimum Downpayments now 20% (5% with CMHC insurance) - CHMC insurance for lower downpayment limited to anfew thousand mortgages a year - Max Amortization period lowered to 25 years Thats what they tightned it down to in last occasions. The stress test is the newest tightnint theyve done. I dont know how much banks must assume rates will raise by for this test tho, it never specified. Link to post Share on other sites More sharing options...
DeanWinchester 41,390 Posted November 3, 2016 Share Posted November 3, 2016 1 minute ago, Economy said: - Minimum Downpayments now 20% (5% with CMHC insurance) I thought this was only for houses that cost 500,000 up? Or was that changed again? Flyin' like a 1000 Doves Link to post Share on other sites More sharing options...
The Fame Joanne 5,985 Posted November 3, 2016 Share Posted November 3, 2016 27 minutes ago, Sepsami said: I read "for homos" Same Link to post Share on other sites More sharing options...
Economy 52,845 Posted November 3, 2016 Author Share Posted November 3, 2016 33 minutes ago, Smarticle said: So does this mean it's harder to get a mortgage now? RIP in single home purchases for lower income individuals Yes depending on your situation Up until now if you could make mortgage payments with your income and you had the downpayment youd generally get approved But now the stress test puts you in a hypathetical scenario in which interest rates rise and therefore so do your payments. If you can make payments now but you couldnt in the event of higher interest rates, you will no longer be able to get that mortgage, youd need to find a cheaper house Link to post Share on other sites More sharing options...
Economy 52,845 Posted November 3, 2016 Author Share Posted November 3, 2016 5 minutes ago, A Gaga Lad said: I thought this was only for houses that cost 500,000 up? Or was that changed again? There is something different about houses $500,000 and higher but i forget what it is. Hold on a sec lemme check but i dont think its the 20%. Im pretty certain 20% was made the standard for general homes in the last round of rule tightening EDIT: ok i found it https://www.google.ca/amp/www.cbc.ca/amp/1.3448550 Homes over $1Million dont qualify for CHMC insurance and all must have a 20% downpayment Homes over $500,000 but under $1 Million can get CHMC insurance but can no longer have minimum downpayment of 5%... The minimum was raised to 10% on homes over $500K Any home without CHMC insurance must have 20% regardless of value. CHMC became limited to only a few thousand mortagges a year as of 2 years ago Link to post Share on other sites More sharing options...
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