Various changes have been made once again by the Minister of Finance regarding the Canadian mortgage industry…this article highlights these upcoming changes….
With new rules hitting the housing industry as of October 17th, home buyers will have to qualify at the Bank of Canada posted rate even for a fixed rate mortgage a practice that is currently in place solely for terms of less than 5 years, or on variable rate mortgages, in an effort at risk mitigation.
In dollars and cents, this means a vastly reduced buying power for the average individual.
Currently: a client or household drawing an income of $65,000.00 per annum (with no debts outside of the mortgage) can qualify for a purchase price of approximately $330,000.00 with a 5 % down payment.
After October 17th: that same client or household will only be able to purchase a home with a purchase price of $275,000.00!
A reduction in buying power of $55,000.00 or approximately 17% less buying power than right now!
If you know anyone who is in the market for the purchase of a home, whether it be with 20% down payment or less, please get them to hurry up and come and meet with us asap!
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