Finance Minister Jim Flaherty is offering brokers a respite from any new mortgage rule changes like those introduced in March, suggesting he’s happy with slowing demand stemming from those spring amendments.
"We have seen some moderation in the housing market in Canada," he told reporters after a speech in Toronto. "There are a couple of hot spots in the country, including Vancouver, the condo market in Vancouver, but overall I'm satisfied that there is some moderation in the market."
Brokers who have experienced some of the effects from those changes reacted positively to the government’s intention to maintain its course.
“I was glad that in this market they are not going to make any additional changes because it could have an additional impact on first-time buyers, which, of course, we need,” Margaret Green, a mortgage planner with Mortgage Architects is Mississauga, told MortgageBrokerNews.ca. “While I haven’t seen any effect on my business as a result of the decision to lower the amortization, I have had clients who have not been able to refinance because their property wasn’t worth enough.”
She’s not alone.
While Flaherty has rationalized the narrower constraints for CMHC-insured refinances as the best way of discouraging Canadians from using their homes as ATMs, but some brokers are concerned the policy change has placed undue pressure on homeowners now vulnerable to losing their homes.
“I don’t think that the new refi rules are good, at least not across the board in that the difference between accessing a LTV of 85 instead of 90 per cent may force someone who is in a tough situation through no fault of their own out of their home,” said Curtis Cannon, a sub-mortgage broker with TMG The Mortgage Group in Prince George, B.C.