In the wake of Stephen Poloz’s announcement that he believes Canada will avoid a housing bubble, brokers may agree but they are still wary of any future interference by Finance Minister Jim Flaherty.
“I would agree with what he says; I don’t even think there is going to be a real minor correction,” Jeff Evans a mortgage broker in Vancouver with CENTUM Innovative Financial told MortgageBrokerNews.ca. “There may be some fluctuation in the market but I believe Flaherty is going to do what he wants to do and I don’t think that is going to change.”
Stephen Poloz, the governor of the Bank of Canada, announced Thursday that Canada’s housing market will avoid a bubble situation and instead achieve a soft landing. And Evans, for his part, credits Flaherty’s tinkering for deterring the creation of a bubble.
“It’s really just supply and demand; there is only a certain amount of land available and there is a high demand and that is why house prices are so high,” Evans said. “The mortgage policies are much more restrictive than they have been in the past and they aren’t loosening up any time soon… for there to be any potential for a bubble to burst.”
Meanwhile, industry players in smaller towns may be less concerned with a potential housing bubble and more concerned with the detrimental affect the mortgage rule changes have had on their markets.
“If you look at the overall pricing on the east coast, especially Nova Scotia, you don’t see huge price increases; we’re coming into 2014 and we’re seeing the impact of a lack of sales,” Barb Allen, an independent broker in Truro Nova Scotia said. “All of these changes have made it so many people can’t qualify… so the amount of people this has affected is alarming.”
And while the damage has been done, Allen hopes the government will hold off on making further changes.
“I’m hoping they won’t institute any more mortgage rule changes,” she said. “They make national changes and paint everyone with the same brush but they should look at individual markets.”