Brokers have heard it before, but the Finance minister is saying it again – this time with more conviction – arguing the government simply has no more room to play with the mortgage rules in order to curb household debt.
“We’ve done enough,” Flaherty said during a weekend interview. “I do not intend to do anymore.”
If true, that's good news, say most mortgage brokers.
Many of them complained that the guidelines and rule changes introduced by the Conservative government this summer in order to slam the brakes on an overheated housing market were too harsh. Flaherty himself had earlier conceded that the economy could take a beating with the changes, but called the tighter mortgage rules around amortization and LTV for refinances necessary to prevent a housing bubble.
During Saturday’s interview, the minister said he was pleased by signs of a slowdown in vital segments such as condo markets in white-hot centres Toronto and Vancouver.
One broker, who operates in one of the regions where the rule changes has paved the way for a broker cull, said the revamp has effectively slowed down the market.
While he welcomed Flaherty’s remarks, Michael Marini, Toronto-based broker for Dominion Lending Centres Funds, said it could also be that the newly introduced rules are here to stay.
“I take it to mean that he (Flaherty) is satisfied with what the rule changes have accomplished,” he said. “We may not see any more tightening, but it’s also unlikely that the rules will be reversed.”