30 October 2012
As you know, three months ago the government tried to avoid the debt crisis by tightening mortgage rules. As a result, the maximum amortization term for insured mortgages was reduced from 30 to 25 years and the maximum LTV for mortgage refinance was cut from 85% to 80%.
According to the Conference Board of Canada, real estate sales were down in 21 of 28 metropolitan areas with the main decline reported in July, right when the rules took effect. In addition to it, September sales were even lower according to CREA.
Many mortgage brokers say the new rules implementation was an unnecessary interference and last remarks from Flaherty can simply prove their concerns.